What Every Seller in chester county Should Know About Home Prices
If you’re trying to decide whether or not to sell your house, recent headlines about home prices may be top of mind. And if those stories have you wondering what that means for your home’s value, here’s what you really need to know.
What’s Really Happening with Home Prices?
It’s possible you’ve seen news stories mentioning a drop in home values or home price depreciation, but it’s important to remember those headlines are designed to make a big impression in just a few words. But what headlines aren’t always great at is painting the full picture.
First, lets take a look at national trends in home price appreciation. While home prices are down slightly month-over-month in some markets, it’s also true that home values are up nationally on a year-over-year basis. The graph below uses the latest data from S&P Case-Shiller to help tell the story of what’s actually happening in the housing market today:
As the graph shows, it’s true home price growth has moderated in recent months (shown in green) as buyer demand has pulled back in response to higher mortgage rates. This is what the headlines are drawing attention to today.
Like politics, all real estate is local. Lets take a look at the local price trends in Chester county.
| CHESTER COUNTY, SINGLE FAMILY HOMES | |||
| MEDIAN SALES PRICE FOR 2021 AND 2022 | |||
| Month | Price | Price | % Change |
| 2021 | 2022 | ||
| Jan | $452,500 | $484,900 | 7.2% |
| Feb | $441,700 | $510,000 | 15.5% |
| Mar | $495,000 | $526,821 | 6.4% |
| Apr | $481,250 | $545,000 | 13.2% |
| May | $512,021 | $531,055 | 3.7% |
| Jun | $515,000 | $600,000 | 16.5% |
| Jul | $531,000 | $575,000 | 8.3% |
| Aug | $498,000 | $550,000 | 10.4% |
| Sep | $479,900 | $537,500 | 12.0% |
| Oct | $494,075 | $549,500 | 11.2% |
| Nov | $499,000 | $545,000 | 9.2% |
| Dec | $508,961 | $500,000 | -1.8% |
| Year | $492,367 | $537,898 | 9.2% |
As you can see, we in Chester County had robust year over year price growth in every month except December. I expect price growth to continue, but at a lower rate than the 9.2% we saw in 2022.
But what’s important to notice, on the national picture, is the bigger, longer-term picture. While home price growth is moderating month-over-month, the percent of appreciation year-over-year is still well above the home price change we saw during more normal years in the market.
The bars for January 2019 through mid-2020 show home price appreciation around 3-4% a year was more typical (see bars for January 2019 through mid-2020). But even the latest data for this year shows prices have still climbed by roughly 10% over last year. 3-4% a year is normal for home price changes in the United States.
What Does This Mean for Your Home’s Equity?
While you may not be able to capitalize on the 9+% appreciation we saw in 2022, we should still see price increases through 2023.
The big takeaway? Don’t let the headlines get in the way of your plans to sell. Over the past two years alone, you’ve likely gained a substantial amount of equity in your home as home prices climbed. Even though home price moderation will vary by market moving forward, you can still use the boost your equity got to help power your move.
As Mark Fleming, Chief Economist at First American, says:
“Potential home sellers gained significant amounts of equity over the pandemic, so even as affordability-constrained buyer demand spurs price declines in some markets, potential sellers are unlikely to lose all that they have gained.”
NEXT STEPS FOR YOU:
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No doubt, the housing market is shifting, and it can be a confusing place right now. I suggest that we connect so that I can help you make confident and informed decisions about what’s happening. Minimize the fear or uncertainty that could change your plans. If you’re unsure about how to make sense of what’s going on in today’s housing market, text or call me at 484-574-4088 or go to my web site, (johnherreid.com) and lets set up a time to meet, either on line or in person. I have the software so that we can meet virtually and make the best use of your time.