The real estate market is changing soon! It’s not the crash you have been thinking is coming..
Here is what the experts are saying will happen!
The current market is vastly different from the market of the 2008 financial crisis. In fact, there are several encouraging factors that suggest exciting opportunities lie ahead. From historically low inventory and pent-up demand to falling interest rates, the market is shifting in favor of both buyers AND sellers. Let’s delve into these positive developments and explore why it’s the perfect time to embrace the possibilities in real estate.
Historically Low Inventory, Pent-Up Demand!: One of the key factors driving the current real estate market is the historically low inventory levels. Many homeowners have held off from moving due to high interest rates, creating pent-up demand. Additionally, there’s a significant group of millennials, approximately 73 million strong, now entering their prime homebuying years. These combined forces will generate increased interest and competition among buyers.
Home Owners have Equity: According to real estate expert Brian Buffini, 39% of homeowners now own their homes outright, without any mortgage debt. Another 29% have more than 50% equity in their homes. This means that 68% of homeowners are in a great financial position! In 2008, there were several cases of liar loans where anyone could get a mortgage without even a credit check. Today, California mortgage lenders place high standards on borrowers, and most home buyers are required to have an excellent credit score. This means people can truly afford their homes and are much less likely to go into foreclosure!
Increasing Home Inventory: Current inventory levels are historically low. However, as rates fall and consumer’s start to feel more confident in making a move, this will change & can happen quickly! This shift presents a window of opportunity for both buyers and sellers, as the market becomes more balanced.
Falling Interest Rates: One of the most exciting aspects of the current real estate landscape is the projected drop in interest rates! Economists predict rates to decline to 6% by the end of this year. Looking ahead, rates are anticipated to decline further to the mid-5% range in 2024 and potentially reach as low as 4.5% by 2025. Economists are predicting that 2025 is going to be one of the biggest years in real estate due to the combination of lower rates, higher consumer confidence and pent up demand.
With historically low inventory, pent-up demand, increasing inventory levels, and falling interest rates, the real estate market is primed for exciting opportunities!! It is crucial to recognize that the current market landscape is far from the conditions that led to the 2008 financial crisis. Instead of fear and panic, we encourage you to embrace the positive changes and exciting possibilities within the real estate market. Whether you are a buyer or seller, now is the time to seize the moment and make the most of the favorable conditions. Get ready for a vibrant and thriving real estate market that holds promise for a brighter future!