Monday Morning Minute
If you have been “in tune to the news” these days … you’re probably wondering, amongst other things … where we are in the world of real estate and what does it mean to me? Before you get ahead of yourself, if you are thinking of purchasing a new home or selling your existing home – speak to an experienced and trusted real estate advisor … that would be me 🙂 to get the BIG picture to help you move forward with the best information possible. The real estate market is shifting, and when that happens, it can be very unsettling, which for some, will give them pause in making any decisions, much less making, what can be one of the biggest financial decisions one can make in their life. – buying or selling real estate. Hopefully I can give you a little insight and prospective into today’s market which might help you in your decision-making process.
Here are a few of the headlines in the news that need a little more clarity around the statements …
Home Prices Are Falling
Real Estate terms on pricing – Appreciation, increase in home prices; depreciation, or decrease in home prices; and then deceleration, is an increase in home prices, but just happening at a slower pace. All terms can be confusing if not understanding the context of which these terms are being used.
You may be hearing homes prices are going to fall, depreciate if you will – contrary to that, what experts are really saying is that home prices will continue to appreciate just at a decelerated pace – which just means – currently home prices will continue to rise – just at a slower pace, then we had experienced over the last 2 years of the real estate craze. Might I just add … this is something that sellers will need to understand and prepare for so as to not set themselves up for disappointment with unrealistic expectations. Getting a current up to date – Comparable Market Analysis on your home will be helpful for you to determine your homes true market value. Yes, it is still a seller’s market – which is good news for sellers, due to supply & demand … there are not enough homes on the market for the number of buyers still looking. Now still is the time, if you are seriously thinking of selling your home.
The Housing Market Is in a Correction
Another miscommunication is that the housing market is in a correction. The true meaning of a “market correction is the following …
Expert’s state “A correction is a sustained decline in the value of a market index or the price of an individual asset. A correction is generally agreed to be a 10% to 20% drop in value from a recent peak.” – which has not happened.
As I mentioned above, so long as there is a supply & demand issue – home prices will continue to appreciate, just at a slower pace. That means the housing market is not in a “correction” because home prices are not falling. Perhaps we can look at it as we are entering a more “normal market” as we have known and seen … opposite of which we had experienced over the last 2 years of the real estate craze.
The Housing Market Is Going to Crash
Some of headlines are causing worry that we are in a “Housing Bubble” – soon to burst! Reality is, and experts say we are not in a “Housing Bubble” as we are not in the same market that we had been in 2005-2008 – far from it!! One of the main reasons why is because lending standards today are very different than they were back then. Experts go on to say, as we talk today about “recession” there is fear that credit lending will become tighter. Keep in mind … back in 2005 to 2008 it was so much easier to obtain a mortgage then it is today. Whereas, due to the lessons learned up to the crash, lending standards have significantly gotten tighter to qualify those buyers who are looking today to obtain a mortgage on their home purchase.
Keeping informed of the real estate market, especially in these times is key to making good sound decisions on how best to move forward when considering purchasing a new home or selling your current home. That’s where I come in …
Please feel free to reach out to me anytime with any of your real estate questions and/or concerns – I am here ad happy to help!
Helping buyers and sellers achieve their real estate goals.