How’s the Market?
This is one of the most common questions real estate agents hear. Of course, real estate agents are sales people, and as such they are inclined to put a positive spin on everything. There is no “bad” time to sell a house. There is no bubble, just a correction. And so it goes.
I guess I am as guilty as the next guy. I have been saying all along that the bubble was not going to burst in this area any time soon. It isn’t based on the real estate agent’s eternal optimism, but on my own experience and an understanding of human nature.
It is true that the market goes up and down, just like the stock market, and it can change pretty quickly. But as long as there are more people moving into our area than are leaving, as long as this area continues to be considered one of the best areas in the US to live, based on climate, amenities, opportunity, etc., and as long as there is a chronic shortage of housing and no vacant land to build on, the down cycles are bound to be mere blips on an ongoing upward trend.
There is no question that sales have been off this year, compared to last year. In some parts of the country, even within the state, there has been a serious shift in the housing market with marked price reductions. But not here. The changes here have been very moderate. It is true that sales have dropped to the 2003 level (which was, by the way, a record year!) And the median price of homes has slipped in recent months. That trend could continue into the next year, or it may just be the stabilization and slowdown that one expects in a “normal” year, once summer arrives. The problem we have is that there are not many “normal” years in this area.
For those of you who are concerned about whether or not this is a good time to buy, please note. None other than former Federal Reserve Chairman Alan Greenspan has said, “The U.S. housing market will weaken further, but the sharpest decline is over as inventories of unsold homes decrease.” In other words, we may be close to another up tick. In the meantime, interest rates have dropped down again and are now barely 1% higher than the 40 year record lows set a year ago.
Buyers…. There may not be a better time to buy a house than right now. Demand is low (less competition) and interest rates are low as well. Don’t wait until activity increases again or rates go up again. Could have, should have, would have....... I have heard those words before, when buyers looked back and realized, too late, they had missed a great opportunity. |
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