All across the country house prices are rising. And the price increases appear to be broad in nature. Caution is the word for homeowners and prospective homeowners.
Home prices nationally were 6.7 percent higher than their peak in July 2006, but that does not account for inflation. After holding steady for the last month, mortgage rates began to climb again and are now at their highest level in four years.
Prices are increasing more sharply in the nation’s largest metropolitan markets. The largest 10 cities saw an annual increase of 6.5 percent compared to 6 percent in February. The largest 20 cities saw 6.8 percent gains, up from 6.4 percent in January.
Local leaders continue to be Seattle (+12.7 percent), Las Vegas (+ 11.6 percent) and San Francisco (+10.1 percent). Thirteen of the top twenty cities saw bigger annual price increases in February than in January.
One has to wonder how long San Francisco can continue as it has, particularly with the now steady exodus from the place. (Largely because of cost of living.)
Are we seeing another bubble percolate? Possibly, in the medium term, very possibly. But if we are it’s probably still early. One gets the sense that homeowners are just now getting their feet under them solidly. (No thanks to the Federal Reserve which has undermined the price mechanism and warped the real estate market over the last decade.)
But even these places are getting expensive. Check out this article on housing price trends in Waco entitled “Unpleasant Upswing.”
Several residents living off Waco Drive told the Tribune-Herald their homes’ tax appraisals have increased 30 to 40 percent from last year’s, and one resident saw a 70 percent hike.
Preliminary home appraisals countywide increased by 12 percent compared to last year, to an average of $178,281. The average home appraisal in Waco Independent School District increased by 14 percent, to $134,537, according to the McLennan County Appraisal District. Homes in the Midway and China Spring school districts are valued at an average of about $242,000.
Homeowners will not pay more than a 10 percent increase on property taxes each year, because of a provision in state law. In many cases, the limit means homeowners’ tax bill will be up 10 percent every year for the foreseeable future, until it matches the appraisers’ value.
For those of us who remember the housing crash, and particularly for those of us who got hammered in the housing crash, any price appreciation in our homes is welcome (at least those of us who aren’t being killed by increased property taxes appreciate the appreciation), but real estate gains do not hold the sense of permanence that they did pre-Crash. And that’s probably a healthy thing. America now knows that housing doesn’t always “go up.”