If you read last week’s blog, the caption for this article may have you scratching your head, because I discussed how home prices in the Augusta area had FALLEN for the second consecutive quarter. So, how can it be that the average home price for December 2021 INCREASED sharply by 33.5% compared to December 2020 and have also fallen for two consecutive quarters? And, if both things are true, which statistic should I really care about as a prospective home buyer or seller? To answer these questions, it is important to point out that the year over year comparison is a better “apples to apples” comparison because it takes into account seasonal shifts and fluctuations in the market. Comparing back to back quarters, if taken out of context, can be like comparing a Corvette to a Tesla (No disrespect to Tesla). The quarterly analysis I did last week was my attempt to see if there are any signs that the annual trends we continued to see in December may change in the near future. In other words, just because home prices in December 2021 were 33.5% higher than December 2020, the downward trend observed over the past two quarters could be an indicator that change is on the way. Then again, it could also be a result of people panic buying in response to inflation and the threat of higher interest rates that eventually comes with inflation.
To finish, let me say that there are so many variables in the real estate market and the economy as a whole that change day to day and certainly month to month, so it will never be possible for anyone to predict exactly what the future holds in the Augusta real estate market. However, common sense tells me that a 33.5 percent price increase year to year is not sustainable, and with the Federal Reserve planning four rate hikes during the coming year, the best time to buy or sell a home was yesterday, but the next best time is TODAY. Please call 706-726-2981, comment below, or reply with an email if I can answer any questions about buying or selling your next home! For questions about financing or to get prequalified, contact McKenzie Cochran with Colony Bank Mortgage.