The recent shortage of houses on the Springfield market has continuously led to an increase in prices and sales for the past few months. Single-family pending houses went up by about eleven percent in May last year. Recently, condominium sales went up with more than twelve percent. This has brought about positive confidence in both market and home prices. It has also helped the index to gain over that of 2016. Despite the ongoing inventory shortages and the increment in prices, buyers are still willing to get new houses, leading to intense competition in the Springfield real estate market.
Factors Influencing the Market
Some of the market issues that influence the Springfield real estate market in 2017 include the local economy, new housing, and home affordability. While the lowest factor is affordability in the entire country, the housing market in the city was greatly impacted by the local economy. This is, in addition, to the fact that only a few houses are being presented to the market as compared to the current demand. Other such factors as unemployment and job growth performed worse than the national average. In spite of all these issues, the housing market in the region is still expected to improve.
An Overview of the Springfield Real Estate Markets
The middle price of home listing in Springfield went up three percent, leaving it at 154,900 dollars. Home resale inventory increased by five percent since August 2017, which increased the number of inventories to 262. In Springfield, the median price per square foot is currently at 104 dollars, which increased by a dollar from August 2017.Properties under distress, including short sales and foreclosures, stayed stagnant as a total percentage in September. The statistics of the real estate market in Springfield are usually calculated on a daily basis. They are normally based on different sources so that those interested can stay updated on the new trends. Most of the information given is normally about short sales, foreclosures and real estate owned properties, also known as REO. The information is displayed through charts and graphs, which enables you to see the percentage of distressed Springfield listing. Some of the changes in the market trend include the following.
1. Home Appreciation
Although home appreciation is improving, it had started to lose momentum in 2016. One year appreciation rate reached 2.1 and 3 percent during the early months of the year. This was lower as compared to the national average of 4.9 percent and 17.8 percent. Despite all these lower gains, the appreciation rate continued to go upward in the first half of 2017.
2. Home Equity
Home equity, along with appreciation, was mild for the real estate market in Springfield in 2017. In the first half of the year, equity gains went below the national average despite principle payments and the price appreciating for the past four years. This boosted the total equity growth after the recession that went well for investing in the real estate market in Springfield. However, equity gains for the same area have been falling short of the national average for the past ten years. During the fifth year, home markets got the highest gains; these homes appreciated by 33,000 dollars.
3. Foreclosures
Another important component to put into consideration in the Springfield real estate market is foreclosures. Homes that went up into foreclosure in December last year had appreciated by 41 percent than in November. Real estate property owned by banks went up during the early months of the year. Such real estate owned assets increased by 22 percent, which had skyrocketed by 193 percent during the same period in 2015. This led to a tremendous increase in opportunities in the Springfield real estate market.
Prediction for the Springfield 2017 Real Estate Market
The city of Springfield has newly completed units and others that are pending completion. All of these are expected to hit the real estate market listing soon. This is driven by the high competition seen and high demand for homes all over Springfield. The market has been favoring sellers, but there are signs showing that the trend might change. Some of the predicted changes include those highlighted next:
Scant Inventory Will Keep the Prices High for Some TimeThe continued lack of sufficient houses and homes in the Springfield market has been to the advantage of sellers who end up receiving multiple offers. This is motivated by the buyers’ will to purchase in the competitive market. Until the number of listing increase, the trend will stay the same.
Eventually, the Sale Prices will FallThe sales prices in the city will fall eventually as more properties get injected into the market. As the year goes by and owing to the large number of properties being developed, there will be an increased number of units in the market. Even though the prices of homes have greatly appreciated in the past few years, issues with mortgage rates are likely to affect the rate of appreciation. The presence of numerous options will allow the buyers to ignore price tags that do not fit their budget.
Increase in New PropertiesThe entry of new properties in the market is expected to go up on in the near future. Increased demand for more housing in the city is bound to attract more real estate investors. More investments will most likely lead to more houses being added to the Springfield real estate market.
As scarcity continues to be a major issue in the market, sellers will remain in a favorable condition. This will, however, change as more properties are being built, which means that buyers will end up in a better position. This trend is expected to extend into 2018.
Conclusion
The real estate market in Springfield is expected to see a weaker price growth for the next twelve months as compared to other cities in the United States. House prices are expected to grow by about 3.3 percent, which is still lower than the national average of 3.6 %. Even though significant improvements are expected as more properties are being introduced, Springfield city will still have an interesting real estate market.