While the stock market has been off to a rough start in 2016, the big news in residential real estate has largely been positive. The nation’s largest metro areas saw an increase in the number of homes sold, and values have been climbing steadily.
In Austin, prices and the pace of home sales hit an all-time high as the metro area’s growth continues. And local experts say they expect 2016 to be another strong year. That will continue to drive concern about affordability across the region, and the city is considering a series of new policies aimed at encouraging more affordable options.
Now, let’s take a look at the rest of January’s top real estate news.
Houses Are Getting Bigger and More Expensive
Tiny homes might be trendy in some areas. But, nationally, the average size of a newly-built home continues to increase. New data from the National Association of Home Builders shows that the average new home is built to 2,720 square feet. That’s up 60 square feet from a year ago, according to the Wall Street Journal. And more than half of those new homes have four bedrooms or more. Homes have been growing in size since 2008 when the nation’s economy cratered. The average cost of a new home has also been on the climb, increasing by $100,000 since 2009 to reach $351,000.
Austin Area Home Values Set New Records in 2015
The year’s stats are in, and they show that the average sale price of Austin area single-family homes hit their highest figure ever in 2015, and the pace of sales also bested prior years. Data from the Austin Board of Realtors shows 29,068 homes were sold last year, setting a new record and representing a 4.7 percent increase over 2014. All those sales added up to $9.6 billion, surpassing 2014 totals by more than a $1 billion. The average sale price, meanwhile, hit $333,448. That’s 8 percent more than 2014. Local economic indicators, including sustained low unemployment rates throughout the region, largely point to continue growth in the market this year, although falling prices of oil and gas could impact the region. See a full report on the data here.
Real Estate Remains the Most Valuable Asset Worldwide
Here’s a number that’s hard to conceptualize: $217 trillion. That’s how much the world’s combined residential real estate is worth, according to figures reported by MarketWatch. That dwarfs the total value of the world’s gold, securities and equities. In fact, that’s more than double the world GDP. The U.S. makes up about 21 percent of that, while China makes up nearly a quarter of it.
New Jersey Home Values on the Rise
Home values in New Jersey are continuing to climb, but they still haven’t reached the levels seen just before the economic collapse of 2008. Homes prices in Bergen County, for example, increased by 4.7 percent in November compared to the year prior. And in Passaic, prices increased by 12.5 percent, according to NorthJersey.com.
First-Time Homebuyers Taking the Plunge
With the economy making some gains in many markets, including Austin and New Jersey, the number of first-time homebuyers is on the rise. Bloomberg reports that mortgages backed by the Federal Housing Administration were up 54 percent last September, compared to the same period the year prior. Those types of increases indicate more people are leaving the renting world behind because those FHA-backed mortgages are usually used by first-time buyers. The uptick is largely attributed to mortgage insurance premiums being pushed down by the Obama administration.