Home prices continue to rise even now. Based on NY Rent Own Sell research, house prices have climbed by about 15% over the past year. The fact that houses are now so expensive is simply the outcome of the supply and demand problem.
Following the onset of the COVID-19 pandemic, interest rates were reduced to boost economic health. The drastic drop in interest rates, combined with numerous Americans’ desire to abandon apartments and cities in favor of residential areas and lower prices, created an increased demand. In contrast, many sellers withdrew from the market due to political and economic instability. More buyers than sellers have since entered the real estate market, and total house prices have dramatically increased as a result.Why Do Houses Cost So Much?
Political and economic changes have contributed to the steady rise in house prices. Other vital wages rise factors that factor into why houses cost so much include:
- Lower Interest Rates
- Demographic Change
- Higher Building Costs
- Lower Builder Trust
- Augmentation of Land Prices
- State Subsidies
- Increase in Local Zoning Regulations
