Housing Market to Normalize in 2006

Posted at 9:41 PM, Jan. 11, 2006

In the last three weeks we have been showing clients about 40 houses in the $300K to $400K range. By the second day of showings, it occurred to us that most of the homes were vacant; in fact in the end only 3 homes were occupied. Of the three homes, an elderly woman who was moving to a nursing home the next day, occupied one, the other two were occupied and the families were looking for other homes with another REALTOR®. Of the rest of the homes, 1/3 were a divorce situation (Only the clothes of a woman or a man and some furniture were in the house.), 1/3 were sold but back on the market because the deal fell through, and the rest had moved into new or resale homes. The reason I bring this up is that RISMedia's Daily e-News (A free real estate news service presented by RISMedia, publisher of Real Estate magazine. RISMedia, Inc.) published an article today entitled Housing Market to Normalize in 2006

Housing Market to Normalize in 2006
NAR economist: cooling sales are necessary for the long-term health of market
RISMEDIA, Jan. 11 The key word for the housing market in 2006 is balance, with a return to a more normal rate of price growth, according to the National Association of Realtors®.

This experience of ours is just a small example that the market is adjusting or moving from the hot sellers market through a transition period before becoming a buyers market. You have probably heard a lot about the bubble and that it is about to burst. It's not going to happen. Prices will just not have the sharp rise that has been occurring in the last few years. We will see a leveling of prices with some price reductions in homes that have been deliberately overpriced in anticipation of catching a higher price in a rising sellers market.

In addition we have seen homes lingering on the market for longer periods of time. Sellers and their REALTORS® will have to pay greater attention to their local market and price their homes accordingly. Sellers would be well advised to consider close offers very carefully, you may not have an opportunity of a sale at that price again.

Bart Erickson

Member of the HouseJeanie Team