In recent memory, if ever, we have never witnessed, a real estate market, similar to, the one, we are currently, seeing! After, over 15 years, as a Real Estate Licensed Salesperson, in the State of New York, I strongly, believe, the housing market, will, probably, always, be cyclical, and, at some point, this, too, will change! While, there are several factors/ reasons/ considerations, regarding, why we are experiencing, this performance, etc, this article will attempt to, briefly, consider, examine, and review, and discuss, 5 specific possibilities, and why/ how, they have created, these circumstances, etc.
1. Pent – up, post – pandemic feelings and needs: The pandemic, this nation, and the world, has been experiencing, for approximately, a year – and – a half, and the emotional impacts, of the public health restrictions/ limitations, on many aspects of our lives, has, probably, created, a large degree of pent – up, post – pandemic, feelings and needs! After feeling locked – up, in their former residences, many discovered, there were many aspects, they wanted to change, either, in the type, and/ or, location of their homes, etc!
2. Historic – low mortgage interest rates: In recent memory, it is hard to recall, any time, where we witnessed, these historically – low, mortgage interest rates! With, rates, hovering, at around 3%, for some time, now, it creates, a situation, where buyers can purchase, often, far – more expensive houses, which fit, their budget! Every point, make a significant difference, in one’s monthly payment, so, when rates are, as low, as today, there is a big change! For some time, the Federal Reserve Bank, has kept, interest rates, artificially – low, and mortgage costs, etc, follow this direction/ actions! However, with, apparent – inflation, being evidenced, in nearly, everything, we buy, at some – point, rates, will, almost certainly, rise! How will that impact, real estate pricing, when that happens, etc?
3. Feelings of higher job confidence/ consumer confidence: Surveys indicate, the public, presently, has higher job and consumer confidence, than, for quite, a while! When, people feel, more comfortable, financially, it often, creates, a Sellers Market, because, more, qualified, potential buyers, are looking/ shopping, etc!
4. Supply and Demand: The economic laws, of, Supply and Demand, hold – true, in many economic areas, and, certainly, regarding home pricing! When, there is more demand, than, supply, prices rise, and when, the opposite happens, buyers have the strategic advantage! Today, there is an inventory shortage!
5. How long will it last?: It is, generally, foolish, to try to, market – time, the housing/ real estate market! No one, knows, for – sure, when today’s trends, and performance, will begin to change, and, the overall impact, when it comes to associated, demand, and, thus, pricing!
The more a buyer knows, and understands, the wiser, he can make the best decision, for him! The better one prepares, the more chance, for making, the right choices!