Median Price Per Square Foot

Median Price Per Square Foot is another high level, big picture indicator. As our chart shows the market is still seeking bottom. We can see in the seven-day averages that price per square foot flattens and might even spike for a short time but the bigger picture 90-Day picture shows a consistent decline.

If this number continues to decline much beyond the current cost to build, our hunch is we will see a big upswing in sellers that decide to take the home off the market and put it into a rental program. Renting, if timed right can provide a positive cash flow and if not timed correctly can at least stop or slow the bleeding.

This can actually be bad news for buyers, as we’ll see in the Inventory chart. As supply diminishes, prices tend to rise. What we are looking for is a more balanced market, where supply and demand are balanced and prices tend towards reasonable appreciation.