Since, we have experienced, perhaps, one of the most prolonged, steep price increases, in housing prices, many seem to surprise, will this continue, and, if so, for how long, and then, what! Since, historically, real estate prices fluctuate, and, often, it is challenging, to precisely, predict, trends, and, certainly, there is no such thing, as a crystal – ball, when it comes to making these predictions, it is wise to try to avoid any attempt to market – time! After, over 15 years, as a Real Estate Licensed Salesperson, in the State of New York, I believe, and recognize, there are, at the minimum, four possible pricing trends and possibilities. With, that in mind, this article will attempt to, briefly, consider, examine, review, and discuss, 4 of these, related to the residential housing market.
1. Will it continue rising, at, or near, the present rate?: Most doubt real estate prices, will, continue rising, at this speed, for a prolonged period, into the future! Many factors produced, slightly of, a perfect storm, related to what we have witnessed, for about a year! The emotional stresses, and concerns, emulating from this horrific pandemic, a desire to make certain changes in lifestyle, and a desire to avoid, delaying, in addition as close to record – low, mortgage interest rates, have contributed, in addition as, in certain, popular, geographic areas/ regions, Supply and need, issues, which, produced a Sellers Market, have accelerated this course of action, and results!
2. Continue rising, but, at a slower, more gradual speed?: Might pricing continue rising, but, more little by little? At some point (and many, believe, we have already begun, witnessing, some evidence), many possible, qualified buyers, will get discouraged, and, if this is combined with, more homeowners, trying to cash – in, and sell, the speed, will certainly slow!
3. Will prices level – off?: How far, will the possible cooling, of this market, go? Will we see, prices, level – off, and for a period (adjustment period), make pricing, more stable, and already? When interest rates, ultimately, increase, as it seems will occur, probably, in 2022, what will that do to prices, and perceived costs, because, higher rates average increased monthly payments, etc?
4. Will prices, decline, and, if so, why, and for how long?: Since, prices escalated so rapidly, and so much, could they decline, at some point? Although, historically, home prices rise, with inflation, this increase was not considerably, related to inflation! While it is possible, we will see a decline, most believe, it will probably, level – off, and become, more like, we witnessed, historically, so any period of falling prices, will, most likely, be slightly short!
Since, for most, their house represents their single – largest, individual financial asset, doesn’t it make sense, for possible homeowners/ buyers, become better – educated consumers? Will you pay more attention to the possibilities and realities?