The steady rise in the housing market has had both investors and buyers in a flurry of excitement – How did the market get so hot in such a small period of time?

residential real estate investing

The price changes in both the residential and commercial real estate sector has been a true roller coaster ride – markets that were deep in regression just a year ago are showing double figure increases in the prices. With real estate flourishing in Florida, Chicago, Arizona and even Detroit, real estate investors are forced to stop think - is the period of the ‘boom years of real estate’ back again?

According to the latest prices quoted by Realtor.com, the median prices have increased by a stark 50% in some areas compared to the figures obtained last years. Amongst these markets the main highlights are posed by California, where the houses in Santa Barbara showed increased prices of 56% as compared to last year. Los Angeles saw an increase of 27%, San Francisco 23% and Detroit 22%.

Even cities which had never before seen a strong emphasis in real estate investment have their median prices climbing up the charts in no time. These include Houston where the prices increased by 10%, Dallas where an 8.6 percent increase was seen and even Atlanta where a significant increase of 14.6% was noted by experts.

The situation is almost the same all over the country, with these increased prices ringing victory bells for investors looking to cash in the market in the upcoming summer season.

However, the point to note here is that even the steady increase in the prices has not deterred the demand of residential property on the market. On the contrary, more and more buyers are looking for decent places to settle in.

The result – a stark decrease in the inventory. The booming real estate market is failing to keep up with the rising demands of the buyers.

Coming to the facts, here are the possible reasons for the continued demand of real estate in the market.

  • The economy is definitely on the up rise, and as the employment rate continues to improve, more and more people are ready to move from rentals to their first home.
  • There has been a definitive lack in mortgage regulations on the federal level, making financing easier for most individuals. As the mortgage rates are currently at their affordable best and a variety of options are available for fulfilling the American dream of a personal home, it is no wonder that lots of people are thinking about a personal property at the moment. From zero down payments to negative amortizations, it has never been so easy to embark upon a mortgage and move into your personal home than today.
  • The inventory is on its tightest verge, with decent houses literally flying off listings in a matter of days rather than weeks. Though the prices are high, they still lie in an affordable circle at the moment, and both buyers and investors are looking to take advantage of the situation before the housing market goes out of range again.

Source: MLS listing and median prices quoted from www.realtor.com