We have all heard that one – “No way I’m buying a house in this market! Rates are up, values are up, and probably going to crash anytime now and we are going into a recession. You would have to be living under a rock to want to buy a house now.”
Well, I agree. If I was living under a rock, I would much rather buy a home and live in comfort. Rocks don’t provide the warmth, comfort, protection, and appreciation of value that Real Property offers. But let’s consider the facts.
The largest segment of homebuyers in the market today are Millennials (born in 1981-1996, currently aged 26 to 41). They represent 9 out of 10 First Time Home Buyers and they are hungry for their own place to call home. Then, the Generation X (1965-1980, aged 42 to 56) group, which are in their peak earnings years and in many cases are looking for multi-generational housing or move up housing and possibly building an Accessory Development Unit (ADU). They are also referred to as the Sandwich Generation because they are between the two largest groups and many are caring for adult children as well as their parents.
Lastly are the Baby Boomers (1946-1964, aged 57 to 75). Many in this group are still very active and are seen buying a full range of homes. Some are choosing to downsize, others upsizing, and still others are buying investment properties or second homes. Baby Boomers are still very much in the game and eager to continue building wealth to enjoy and top ass on to future generations.
Simply put, no.
If we compare today’s supply to the supply during housing crisis of 2008, there was much higher than demand then (in addition to extremely poor mortgage practices) and was part of the reasons for meltdown. Supply was over 4 million homes for sale in 2008 with a much smaller demand (population as well). Today, inventory is 1.03 million or nearly 25% of what was for sale in 2008. Also, for sale homes are in escrow 17 days from listing – much less in many of our local areas. Supply does always increase in the spring, so that families can get moved over the summer break, but even with that we are only 2.2 months worth of supply on the market. Down drastically from a normal healthy 6 month supply of home for sale. First TimeHome Buyers make up 28%, and remember, there have been many homes being bought for cash, so when you see mortgage volume numbers, don’t be surprised in the disparity between sales and mortgages.
It is important as well to remember, scarcity creates value. So less homes with constant demand will cause prices to increase. Nationwide appreciation last year was over 20% and even greater here in Redlands. So for those thinking we are at the top and there’s no where to go but down, just consider that Millennials in coming in, Gen X isn’t going anywhere and the baby Boomers are living longer and loving it. This isn’t a bubble.
Possibly, but you may need to act quickly. Interest rates have gone up 1% in the last 2 months and will continue to increase, at least until we are in a recession. A bit odd, but explainable.Long term interest rates (mortgages) are increasing, but actually improve when we are in a recession. They won’t/shouldn’t get back to the 3% range, but they do get better. However, that being said, interest rates are higher, so your payment will be higher. As well, values are climbing and will continue to, so get your dream house now!
I know they aren’t making anymore land. There is a fix amount of land and for that reason alone, land will always have intrinsic value. Sure it will always go up and may at time for a very short period go down in value. But remember the Wissahickon Inn at 565 Walnut and Center, here in Redlands was originally built for in early 1900 for$8,000. This Historic Hotel offered 18 guest bedroom was originally a seasonal home for many of the Uber rich north-easterners. What can you buy for $8,000 today? My goal is simple, to help everyone in Redlands and the surrounding areas to know the truth about Real Estate. It is the best financial mechanism available.
And let’s face it, shelter is nice too.
We have all heard that one – “No way I’m buying a house in this market! Rates are up, values are up, and probably going to crash anytime now and we are going into a recession. You would have to be living under a rock to want to buy a house now.”
Well, I agree. If I was living under a rock, I would much rather buy a home and live in comfort. Rocks don’t provide the warmth, comfort, protection, and appreciation of value that Real Property offers. But let’s consider the facts.
The largest segment of homebuyers in the market today are Millennials (born in 1981-1996, currently aged 26 to 41). They represent 9 out of 10 First Time Home Buyers and they are hungry for their own place to call home. Then, the Generation X (1965-1980, aged 42 to 56) group, which are in their peak earnings years and in many cases are looking for multi-generational housing or move up housing and possibly building an Accessory Development Unit (ADU). They are also referred to as the Sandwich Generation because they are between the two largest groups and many are caring for adult children as well as their parents.
Lastly are the Baby Boomers (1946-1964, aged 57 to 75). Many in this group are still very active and are seen buying a full range of homes. Some are choosing to downsize, others upsizing, and still others are buying investment properties or second homes. Baby Boomers are still very much in the game and eager to continue building wealth to enjoy and top ass on to future generations.
Simply put, no.
If we compare today’s supply to the supply during housing crisis of 2008, there was much higher than demand then (in addition to extremely poor mortgage practices) and was part of the reasons for meltdown. Supply was over 4 million homes for sale in 2008 with a much smaller demand (population as well). Today, inventory is 1.03 million or nearly 25% of what was for sale in 2008. Also, for sale homes are in escrow 17 days from listing – much less in many of our local areas. Supply does always increase in the spring, so that families can get moved over the summer break, but even with that we are only 2.2 months worth of supply on the market. Down drastically from a normal healthy 6 month supply of home for sale. First TimeHome Buyers make up 28%, and remember, there have been many homes being bought for cash, so when you see mortgage volume numbers, don’t be surprised in the disparity between sales and mortgages.
It is important as well to remember, scarcity creates value. So less homes with constant demand will cause prices to increase. Nationwide appreciation last year was over 20% and even greater here in Redlands. So for those thinking we are at the top and there’s no where to go but down, just consider that Millennials in coming in, Gen X isn’t going anywhere and the baby Boomers are living longer and loving it. This isn’t a bubble.
Possibly, but you may need to act quickly. Interest rates have gone up 1% in the last 2 months and will continue to increase, at least until we are in a recession. A bit odd, but explainable.Long term interest rates (mortgages) are increasing, but actually improve when we are in a recession. They won’t/shouldn’t get back to the 3% range, but they do get better. However, that being said, interest rates are higher, so your payment will be higher. As well, values are climbing and will continue to, so get your dream house now!
I know they aren’t making anymore land. There is a fix amount of land and for that reason alone, land will always have intrinsic value. Sure it will always go up and may at time for a very short period go down in value. But remember the Wissahickon Inn at 565 Walnut and Center, here in Redlands was originally built for in early 1900 for$8,000. This Historic Hotel offered 18 guest bedroom was originally a seasonal home for many of the Uber rich north-easterners. What can you buy for $8,000 today? My goal is simple, to help everyone in Redlands and the surrounding areas to know the truth about Real Estate. It is the best financial mechanism available.
And let’s face it, shelter is nice too.
With 18+ years of experience, we created these to help all those who are looking to buy, get financing, and/or sell their homes. These are free and ready to download at the click of a button! Choose a packet to get yours today.
