Where is the market going?
As we see inventory rise, as well as rates going up, I have been hearing rumblings of the market is about to crash!!! Nothing could be further from the truth. The only time a real estate market crashes is when there is way more inventory than qualified buyers. A perfect example is 2008 when 6 out of 10 homes we were showing were foreclosures.
First, let’s look at why that happened. The economy was bad, true enough, but also home values had started to drop and it’s much easier to let it go when it’s worth less than you owe (we had gone through years of 100% financing but that is a whole other story). Currently, homeowners have more equity in their homes than at any time in history, so unless they have to, they are NOT letting them go to foreclosure.
Yes, inventory is rising, but from a working Realtor's eyes, this is a good thing. Sellers have had it really good for several years, and from my point of view the market is just playing catch up from the negative growth from 2008-2015, so Wala, has more equity. The low inventory has been a double-edged sword though. Sellers were afraid to put their homes on the market, simply due to the fear of being homeless. So, in this current market, it’s good for sellers as they can negotiate their sale (along with great equity) and find a home. So, it might be an awesome time to be selling. It’s also good for buyers as they are now in most cases not paying way over appraised values, and are even beginning to negotiate repairs, and warranties (is the seller paid closing cost next?).
So, to wrap this up, a balanced market is usually good for the overall health of the real estate world. Sellers, your values are not going to drop. Now just may be the PERFECT time to sell. Buyers, prices are not going down, and rates have stabilized somewhat, so now might be the perfect time to buy!!! I would say a lot of agents have done great in this red-hot market, but with change comes change. The more experienced agent you can work with in this evolving market the better. I expect to see a decrease, or at the very least, a slowing of new Realtors coming into the market as things change. Folks, things are always changing in my world!!
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