After, over 15 years, as a Real Estate Licensed Salesperson, in the State of New Year, I attended, to think, perhaps, the main one, reality, of property, is, it is consistently, constantly changing, in many different ways! For a couple years, we’ve been experiencing, near – historic, low, interest rates, in addition to, unprecedented impacts on the planet economy, created by several factors, but, perhaps, the single – biggest one, being, the ramifications, etc, created/ causes, as a result with this horrific pandemic! Although, no one, knows, for sure, what will occur, I feel it may be useful, to take into account, and provide, my best – guess, when it comes to home pricing, in the intermediate – term (This period is usually, considered, to be, from about, two – and – a – half years, to about 5 to 7 years). With, that in your mind, this short article will attempt to, briefly, consider, examine, review, and discuss, 5 of my guesses/ predictions.
1. Interest rates/ mortgage rates: Basic economics, past trends, etc, should indicate, interest rates, will not remain, at their current, historic – lows, for any substantial amount of time. It has, existed, for longer, than normal! We’re already, witnessing, inflationary ramifications, due to economic policies, of the past, couple of years, in addition to, artificially – low, prolonged period with this, interest rate, policy, etc! I’d expect, sometime, in the next year, roughly (unless some, unforeseen – stress occurs), for, these to riser, gradually, and, for, the existing, record pace, of home price rises, to either, level, or, grow, at a much – slower pace, or, even, come, back – to – earth, somewhat! This change directly impacts mortgage rates, and, when these are lower, it creates, more expensive houses, less expensive!
2. From sellers market to: Historically, the true estate market, is cyclical, and we’re, currently, undergoing, a prolonged, sellers market, with buyers, out – numbering, inventory! It will make sense, to expect, the trend to alter, from this method, to, first, a more – balanced one, and, perhaps, even, at some stage, to a buyers market!
3. Supply and Demand: Similar to economic commodities, property is based, on the Laws of Supply and Demand! This implies, the more demand, the larger, the costs, and when it dwindles, prices drop! Most expectations is to see, a gradual, return to the cyclical conditions, often, witnessed, and experienced, before!
4. Impact of inflation: Traditionally, houses, have now been considered, one of the best hedges, against inflation! However, with the steep, recent increases, which have far increased the rate of inflation, wouldn’t it make sense, for, these, to eventually, become, more level, etc? While, many anticipate, inflation, in the relatively – short – term, we will probably, return, to more predictable levels, in the intermediate – run!
5. All property is local: Among the challenges, to making these predictions, is, property, is, often, local, in – nature, and, different regions, and, even, neighborhoods, out – perform, others!
Although, I feel, these are likely, that occurs, remember, they are, merely, best – guesses, and no one features a Crystal Ball, etc! Proceed, cautiously, and aware, and align, your needs, priorities, perceptions, etc, along with your personal safe place!