This just in: Supply and demand apply to real estate, just like any other good, service, or commodity. As the Old Man used to say, something is worth whatever someone is willing to pay for it.
That’s why it’s interesting to see a claim that, in five southern states, homes are “overvalued.” In a free market, if a good, service, or commodity is overpriced — which, I’m sure, is the word they were looking for here — it won’t sell. These houses are selling, hence, not overvalued or overpriced.
An overwhelming majority of homes in the U.S. are overvalued as steep mortgage rates and an ongoing housing shortage push the price of real estate even higher.
A new report published by Fitch Ratings found that homes were overvalued by 11.1% at the end of 2023, a trend occurring in about 90% of U.S. metro areas.
But the increase in homes being sold at prices over the long-term average was…
