Bringing you the latest Market Update provided by the Pacific West Association of Realtors.

Rising home prices, higher interest rates and increased building material costs have pressured housing affordability to a ten-year low, according to the National Association of Home Builders. Keen market observers have been watching this situation take shape for quite some time. Nationally, median household income has risen 2.6% in the last 12 months, while home prices are up 6.0%. That kind of gap will eventually create fewer sales due to affordability concerns, which is happening in several markets, especially in the middle to high-middle price ranges.

New Listings were down 0.1 percent for Single Family homes but increased 6.5 percent for Townhouse­Condo properties. Pending Sales decreased 48.9 percent for Single Family homes and 53.4 percent for Townhouse-Condo properties.

The Median Sales Price was up 4.7 percent to $712,000 for Single Family homes and 9.3 percent to $470,000 for Townhouse-Condo properties. Months Supply of Inventory increased 20.7 percent for Single Family units and 55.0 percent for Townhouse-Condo units.

While some are starting to look for recessionary signs like fewer sales, dropping prices and even foreclosures, others are taking a more cautious and research-based approach to their predictions. The fact remains that the trends do not yet support a dramatic shift away from what has been experienced over the last several years. Housing starts are performing admirably if not excitingly, prices are still inching upward, supply remains low and consumers are optimistic. The U.S. economy is under scrutiny but certainly not deteriorating.