Hot takes on our current real estate market are coming in fast and furious. “The market is tanking!” I’ve also heard things like, “Selling your home now is a massive mistake.” Well, we’re going to sort through the madness and hit you with the truth. I’ve been an expert real estate agent for 16 years now and here’s what you need to know about real estate today.
Truth #1: Sellers Hold the High Ground
It’s hardly ever the case that no one can benefit in any given real estate market. Unless it’s a pure balanced market, one side will have the advantage. Right now it’s the sellers… big time.
While it’s true that the increase in interest rates has made things more difficult for home buyers, there’s still a solid number of home buyers out hunting. Since the pandemic and the new restrictions put in place by political leaders, many are leaving the big cities in search of a more libertarian lifestyle. Having homes to sell to these folks is a great problem to have.
Truth #2: Homeowner Equity Expands
Homeowners are now realizing a massive increase in their home’s equity. The past two years have been like that very first hill of a giant roller coaster—pretty much straight up. Depending on where you live, the extent of these gains will likely be met with a fairly large dip but you’ll still end up on the right side of things, as long as, you didn’t buy last week.
For example, here’s my home market. Take a look at what home prices in Louisville, Kentucky have done over the past three years. It’s not crazy, but it is solid growth.
Truth #3: Inventory Is Scarce
Across the country, housing inventory is extremely limited. This is the biggest reason why prices have risen so quickly. Basic economics tells us that when supply drops but demand remains constant then prices must rise.
If you’ve been looking to buy a home and had trouble finding the perfect place, don’t despair. This is kinda the new normal right now. But there’s hope around the corner!
Experts are in basic agreement that prices will return to a more normal level. This is while housing inventory is increasing. Of course, you’ll need to make your decision based on your own personal circumstances. What you need to know about real estate today is that better deals are just over the horizon.
Truth #4: Buying Beats Renting
This is generally the case throughout history. In most US markets, people who own their own homes are performing far better than those renting. We’re talking financially here. But if you have to rent because of temporary employment or an uncertain future relationship, by all means, rent and keep your options open.
But if you can qualify and then pull off the purchase, you should make that happen. The vast majority of millionaires got their start in real estate. Your own home counts as part of your real estate holdings so it’s the logical first step.
Conclusion
Hope you have enjoyed our quick hit on what the real estate market looks like today. Visit my blog for more timely pieces. Have a great day!
