As the summer comes to an end, it marks a period of increased real estate activity and an increase in prices.  To some extent I attribute these increased to normal seasonal trends.  The situation improved somewhat and some buyers got off the fence.  In some cases, competition heated up into a buyer frenzy with multiple offers coming in.  I’ve been a bit surprised by that.

My take on the situation is that no fundamentals have changed.  The housing market is driven by jobs and the economy.  I can’t see much reason to justify more than a minor up-tick in home prices right now.  But apparently many people have forgotten all about the “housing bubble” and are out trying to scoop up great deals.  In their excitement, if they enter bidding wars they are most certainly defeating their own purpose.

This may be the right time to buy for some people due to low interest rates.  After all, payments are the main driver of affordability, not price.  So for now, low interest rates are helping to support prices.

Time will tell how long interest rates stay low.  They are being manipulated to keep them low now, but at some point the helping hand of the government may run out of money.  We will see.

My advice to buyers is to shop around.  Don’t go crazy and get into an auction atmosphere of competing bids.