Are we in a real estate bubble? More than a few people are asking.

First let's make sense of the numbers:
- Buyer demand rose 27% in the last 30 days mostly, I'd say, indicative of the early spring market surge coupled with buyers getting in early to beat the rate increase.
- Inventory is at an all-time low of .5 months in the DC Metro market. This means that if no new listings come on the market, current inventory will sell out in half of a month. A market balanced between buyers and sellers has an inventory of 6.0 months.
- A 100.3% list to sales price ratio means that on median homes are selling for more than list price i.e. multiple offers.

A speculative bubble is a sharp, steep rise in prices that is fueled by market sentiment and momentum, more than underlying fundamentals.
The above stats don't support the notion that we're in a bubble but that the current market conditions are being dictated by supply and demand - low inventory combined with high buyer demand. Is this sustainable? Probably not at this rate. Eventually the rising prices are going to bump up against the ceiling of what buyers in the market can afford. This is why we see the higher end of the market rising more freely than the lower end. Rising interest rates are also going to play a factor in tamping down prices. It's my guess that pricing will start to plateau in the next several months. An actual downturn in prices would likely only come about if we see a dramatic change in supply and demand, such as a flood of new inventory on the market. With the supply shortages builders are facing and the cost of money rising, that’s a long shot.