May 2018 Market Update - Luxury Homes/Top Towns

What’s SALT got to do with it?

In the March Update, I mentioned Jeffery Otteau’s seminar, in which he ran scenarios for a wide variety of marital status/Income/purchase price scenarios; and in the vast majority of cases, the overall tax changes made it a little better or breakeven for home buyers. The March snapshot comparison to 2017 showed an improving market. I promised a May update, and here it is below. Some of our markets are red hot, some have cooled negligibly. In a number of towns, we might see explosive sales volume except for lack of homes to buy. A few towns are getting over-supplied.

The real story is rates.

They are still “historically low” as industry cheerleaders love to say. But no longer historically “low-low-low.” In the second chart you will see how the recent rate increases affect affordability and change the matchmaking of buyers and homes.

Our next deep-dive will be in August or September, by which time we should have an idea how rates have affected market temps.