What’s Coming Next in the Real Estate Market?

Part 4 of a 4 part series on the current housing market.

If you’ve read parts 1, 2, and 3, you know that we’ve covered what a housing bubble is, how our current market is different from the crash of 2008, and the factors that are creating our current market. (Make sure to click the links to review those posts if you didn’t catch them the first time around).

Now the question that remains is: what’s going to happen next?

Well, we’re not psychics, but we are experts at reading the trends and interpreting the market.

Based on what we’re seeing (and what we discussed in part 3) our expectation is that prices are not going to fall.

We expect that the rate that prices are rising will stabilize but that they won’t reverse, meaning that if you’re a buyer “waiting for the market to slow down,” you’re only letting prices and mortgage rates rise.

Currently, we’re seeing buyers getting increasingly frustrated that their over-list and seller-advantageous offers are being rejected. We know it’s not easy but if you can stomach the struggle, now is the time to buy before rates and prices rise any higher.

Mortgage rates are still better than normal (and the Fed has been buying securities to slow inflation) and equity is growing at incredible rates. In fact, according to CoreLogic, in 2020 home equity in mortgaged homes gained 16%, or $1.5 trillion[1].

We expect that price growth will slow to a more historic 3-4% year over year rise versus the current 11-17% were seeing in various parts of the country. Over the next year, we expect to see the market stabilize as increasing rates and values price buyers out of the market and demand begins to decline.

The factors contributing to the current rise (millennials entering the market, lack of inventory, etc.) are not going to disappear overnight, so we don’t believe that we’ll see a sudden halt to value increases so much as a gradual slowing.

When it comes to housing bubbles, trouble happens when the bubble bursts and values drop. That is not what we see happening here.

If you are one of the people waiting for the market to slow down, don’t wait any longer. This is not a bubble. It will not burst. You will not be able to scoop up property at a steal.

When you’re ready to discuss what this all means for you, give us a call at 321-300-4750. We can help you prioritize your goals and figure out how you can maximize your real estate portfolio to suit your needs.

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Steven Ritz, Buyer Specialist - Call 321-277-8271 or email here

Linda Sitek, Listing Specialist - Call 407-963-6544 or email here 

Brought to you by Abode at Keller Williams Winter Park Realty

[1] https://www.floridarealtors.org/news-media/news-articles/2021/06/real-estate-economy-its-not-bubble-unless-it-pops?utm_campaign=6-16-2021+Florida+Realtors+News&utm_medium=email&utm_source=iPost