The front page headline for Argus Leader on Tuesday September 23rd was “Tax growth beats expectations.” The article gave a rousing economic report for the City of Sioux Falls and surrounding areas. According to the Sioux Falls Finance Department, sales tax revenue for August this year increased 11.7% over the previous year; a 25% increase over expectation for the 12 month rolling average. The four county area added 2,000 jobs in June and July, and the unemployment rate is 2.1%; one of the lowest in history.
This level of employment creates greater demand for employees; consequently, wages are rising and household income is increasing. According to a recent Wall Street Journal article, the national rate is 4% for wage increase over the last year. People are earning more, saving more, spending more, and feeling better about their lives.
In April of this year, the total number of homes sold in The Empire for the year was down 20% from last year; although, sales have rebounded and there is a good chance we’ll end up with as many sales in 2019 as in 2018.
Mortgage rates remain low and are just under 4% for a 30 loan and around 3.5% for 15 years; and, it appears there is little chance of them rising in the near future.
This economy is equal, if not better than, the 1980’s market; which sent us on a 20 year bull market. Talk of a recession is pure nonsense. An economy driven by labor will always thrive. When people work and earn money everyone wins!
That means sales will continue at a solid pace, prices should stay flat or increase slightly, and real estate ownership will still be a good investment as well as a place to call home. A caveat to all of this may be the world of political rhetoric. Some people, hoping things to be different, may convince enough people things aren’t as good as they appear, which can develop into a high level of uncertainty and therefore affecting consumer confidence and their willingness to spend money.
The Ratchford Group continues to be optimistic, and believes a good plan for buying and selling is essential for the best outcome. We have developed a process that will help you maximize your dollars, save you valuable time, and give you peace of mind knowing you are doing the right thing at the right time.
All my best,
Tony Ratchford, Broker for KW Realty Sioux Falls, CRS, ABR, SRES, Luxury Homes Institute Member
“Before anything else, preparation is the key to success.” Alexander Graham Bell
