Time Running Out In The Real Estate World? Is It Time to Cash In Now? The Housing Market Bubble?

As the real estate world turns, we know that eventually the insane prices that sellers’ are receiving for their home will end. Real estate is extremely cyclical. We see this pattern every 13-15 years and this time is no exception. The last “crash” was in 2008/2009 and, right on cue, here we are 13-14 years later at the top of the real estate bubble. Home prices have far exceeded even the crazy prices of 2005/2006. Just like in the last crash, home sellers are back to using their home as ATM machines and pulling out cash. It’s as if nothing was learned from the last crash.   The Feds have already stated that they will be raising rates several times this year. Coupled with inflation, and staggering home prices, we are poised for bursting bubble. For the last several years, all we have heard is that the real estate market is hot and home prices increasing at record rates along with low inventory. It’s the perfect storm.   Prior to the pandemic, we were starting to see a slowing down in the multiple offers and crazy over bidding of list prices. Then pandemic enters and lockdowns ensued which re-invigorated the real estate market as buyers did not want to be stuck in their apartments anymore. So now we have more buyers looking for homes that would not have been ready to buy for a couple more years. But the pandemic sped up that process.   Do I think home prices will plummet? Hell no. That’s going to take a while. Do I think the 2022 Spring Market will be the last hoorah for the crazy prices? Yes, yes I do. And literally every lender, realtor and financial investor I talk to all seem to agree. The home prices we are seeing are just not sustainable. We have LITERALLY out priced the first time home buyers that typically only have the minimum deposit, need to use FHA Mortgages, etc. The new first time home buyer is paying upwards of half a million for the homes that used to be considered “starter homes”. The larger, upgrade homes are virtually out of reach for many now.   I think what we will see is a last hoorah for this spring market as we still have buyers that weren’t able to buy last year and are still looking. I think we will see a bit more inventory this spring as sellers will want to capitalize on these prices and head out to warmer climates in the US. Then I think over the summer we will see prices stabilize, over-bidding will die off and buyers will be able to start offering at less than list price.   The other, scarier, alternative to the above, is that we see a total and complete stoppage of buyers wanting to purchase a home due to fears of job loss, inflation, and higher mortgage rates (which, in turn, reduces buying power). Once the main stream media starts reporting that the market is slowing, it creates a tsunami of uncertainty. Then buyers start getting jumpy about getting into a mortgage so they adopt the “sit-and-wait” approach.   If you are thinking that this year is the year you want to sell, this may be your last chance to get these prices. If you are relocating to another state and do not have to buy in this state, then you are at the optimal position to be in. You sell now, relocate and rent in your new area and wait for the “softening”.   Either way, the team of Experienced, Professional (and sometimes not-so-professional ; ) fun-loving, hard working Realtors at https://www.keytothedream.com/ are ready to help you. Whether you need a consultation, question & answer session, or ready to list now, we can help. Call/Text us at 781.269.2195 or email us @ Lori.Poirier@NeMoves.Com.