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  • Writer's pictureKira Witherwax

Where is the Market Headed?

Updated: Nov 22, 2022

Lately, I’ve been asked often, where I think the market is headed? Where do we go from here? Will it crash? If I list my house, now will the market immediately go down? Believe me when I say no one has a crystal ball. I hope the past 18 months have taught all of us that.

However, will the market correct? Yes. It’s just a matter of when and how drastic. And that is good. It’s healthy for the real estate market to correct when it’s been on such a tear. Balance is good.

They say the market is cyclical. Personally, I picture it as a spiral. Not spiraling down, but spiraling up. As it goes up it will loop down occasionally (a market correction) and then go up again. This is why we view real estate as a solid Long Term investment. Let me repeat that. It’s meant to be long term. Because in the middle there will be some corrections. Sometimes life “requires” you to sell even if you haven’t owned the property for a long time (moving for a job, marriage, divorce, a new baby, etc.). Some buyers worry about the long term value of their home if they buy in a seller’s market. I find it helps in that situation to realize that even if you sell your house for what you paid for it you still made a profit. For example, say you bought a house at the end of 2020 (clearly at a time when prices were high) and in 4 years you need to sell your house to relocate for a job. Now say the market is correcting at that time and your house will only sell for what you paid for it. If that’s the case, you lived rent free for 4 years. Yes, you probably had a mortgage, so you had some other costs in there. I understand it’s not that simple. But overall you made out better than if you had rented.

But if you had rented for 4 years the numbers would be easy. You would have paid tens of thousands of dollars into a black hole never to be seen again. Why doesn’t that scare you?

The National Association of REALTORS’ chief economist is predicting a strong real estate market throughout 2021. Understand this a national prediction and individual markets may see things shift at different times.

Personally, I think when cold weather comes this fall our correction may start. In many ways, I hope it does. Because, I hope it does Not fall off a cliff. I hope that we do see more sellers enter the market to sell; which will bring some inventory balance. Meaning there will be less frustrated buyers out there since there will be more houses to choose from. Does that mean prices might start to level out as well? Yes. Remember, balance is good. I think it’s normal for the real estate values to not go straight up for ever. Am I certain about when things might shift? Nope. Still no crystal ball. So please let me reserve the right to have a different opinion in October. Or next week….

Most people choose when to sell their home based on a life event, not how the real estate market is at the moment. But, some people do have the flexibility on timing. If that is you, I urge you to have multiple discussions with your real estate professional. The Market is a constantly changing place and we’re in it everyday.

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