Wednesday, November 8, 2023 / by Nick Waldner
Hello, everyone! In today's blog, we're diving deep into the real estate market, bypassing the headlines and media hype, and looking at the actual state of affairs. Our goal is to provide you with insights and clarity about what's truly happening in the market.
The first thing to understand is that our economy is doing remarkably well. Unemployment rates are at all-time lows, and there are more job opportunities than there are job seekers. The GDP remains robust, and inflation is on the decline. The Federal Reserve, under Jerome Powell, has shown a cautious approach to raising interest rates, dispelling concerns of rapid hikes.
"Our goal is to provide you with insights and clarity about what's truly happening in the market."
Contrary to the media's recurrent recession predictions, the real estate market remains resilient. Unlike the overbuilding and easy lending that led to the 2008 recession, today's market is characterized by a shortage of supply. Home values have been consistently rising due to increased demand.
This year, we expect around 4.1 million home sales, a significant drop compared to the typical 5 to 5.5 million range. This limited inventory resembles a kinked hose scenario. Buyers hesitate due to perceived high interest rates, while sellers hold on to low-rate mortgages. This buildup of demand, once unleashed, will likely lead to a surge in both volume and home values.
It's crucial to emphasize that the current market is fundamentally distinct from the 2008 recession. As Warren Buffett advises, invest in assets that appreciate in value. The real estate market offers such assets.
If you're contemplating a move, make the decision based on your family's needs and not solely for financial reasons. Consider factors like school districts and proximity to loved ones. While economic considerations shouldn't drive your choices, it's essential to recognize that favorable market conditions can be a tailwind when you're ready to buy or refinance.
Whether your real estate plans are on the horizon or years away, I'm here to help. As a real estate enthusiast, I'm passionate about providing insights and answering your questions. Don't hesitate to reach out for a conversation, no matter your timeline. Your real estate journey matters to me.