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  1. SD investor
    January 27, 2017 @ 7:05 PM

    Figure 4 vs the last figure
    Figure 4 vs the last figure both shows inventory vs price change. In figure 4, 3 month inventory and 0% price change is aligned while in the last figure 0% and 6 month inventory is aligned. I keep hearing realtors quoting 6 months being a healthy inventory. Seems like figure 4 has been alignment of price and inventory. I wonder if in the new world of low inventory, 3 month supply means a balanced market with no higher appreciation than inflation?

    Also, Rich do you think the housing price on the middle and upper middle range would drop 6% if/when standard deduction is raised to ~30K? It will negate any mortgage interest deduction for the typical buyers of median house in SD? 400K mortgage @ 4%, implies a 16K interest. So all owners up to ~800K in loan would not be able to take advantage of mortgage interest deduction?

  2. gzz
    January 28, 2017 @ 8:14 PM

    Thank you for the update.
    Thank you for the update.

    The very tight inventory/price correlation has certainly broken down the last three years.

    I would say that it is because of tight lending. You really need a down payment this cycle, so the rental pool needs to save up $60,000 to get a starter home. Once they do, the payments together with MI deduction will probably be lower than their rent, but that does not matter if they don’t have the $60,000.

    The stock market increase should help those saving for a down payment.

  3. gzz
    February 3, 2017 @ 12:24 PM

    January and early February in
    January and early February in my area looks strong for prices. High end places are moving at a good rate and inventory remains extremely low

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