2019 Economic Report
We had a vibrant housing market in 2019, riding on the strength of the national economy. The stock market reached new highs, mortgage and unemployment rates reached new lows.
Unemployment was at its lowest level in several years.
The S&P 500 index reached its highest level since 2015.
Interest rates continue to remain at historically low levels.
On the other hand, this economic strength contributes to high prices and low inventory. According to a recent Inman report, U.S. builders constructed 5.9 million new homes from 2012 to 2019, but there were 9.8 million new households formed, for a shortage of 3.9 million new homes!
These trends are keeping the home inventory down and prices are increasing.
On the rental side, rent prices are also increasing. Nationwide, the average rent increased 3% from November 2018 to November 2019.
We see some similar trends at the state level. The 2019 Georgia Housing Market report from the Georgia Association of Realtors (GAR) shows the average sales price increased 4%, and months of inventory has dropped to 3.3 months.
Source: Georgia Realtors Annual Report on the Georgia Housing Market
Source: Georgia Realtors Annual Report on the Georgia Housing Market
At the local level, average sales prices for Savannah have only increased by 2.6%
While there is a lot of fluctuation during the year, months of inventory for Savannah has also trended slightly down.
Not all the news for price and inventory is bad. The National Association of Home Builders reports the number of new homes under construction is increasing.
Source - National Association of Home Builders, Strong Growth Rate for Housing Starts Going into 2020
In Georgia, we saw a 6.4% increase in the number of new listings and inventory of new construction continues to climb.
Source: Georgia Realtors Annual Report on the Georgia Housing Market
Source: Georgia Realtors Annual Report on the Georgia Housing Market
That’s a lot of data; what does it mean for you? As mentioned earlier, interest rates continue to remain at historically low levels – giving buyers more buying power. Also, for sellers, it is still a great time to sell a home because you have less competition! National and state information is helpful and, please remember, price and inventory levels can vary widely at the local level. If you would like to discuss market trends for your neighborhood, contact us at (912) 507-8062.