Maggie Visser 10/29/22 Maggie Visser 10/29/22

Halloween tricks to navigate a SPOOKY housing market

Upward spiraling interest rates, volatile financial markets, a looming recession, mounting tech layoffs.… the perfect concoction for a spooky housing market.

Given all these head winds, it seems natural to be fearful when you’re embarking on one of the biggest financial transactions of your life - buying a home.

Here are a few tricks to help you navigate the market:

By knowing what you are really worried about, you will be in a better position to adapt. For example, are you worried that your house may lose value after you buy, consider that ………. a drop of 20% in median sales price from this year's Q2 record peak would take us back to Q3 in 2020. In those terms, such a fall may seem reasonable to many.

What we’ve experienced in the housing market for the past two years was not normal.

As the market adjusts and normalizes, it may be unpredictable on a day-to-day or week-to-week basis. However, over 5-10 years these downturns become blips on the screen. Nothing is permanent - even a drop in price is likely to wash out over the next few years.

The best investors seek long term returns instead of aiming to time markets 'perfectly'.

How long you plan to own and/or live in a property matters more than the price and terms you pay today. So focus on the long term. All markets recover and over time, home prices have increased. The US is still grotesquely under-built.... possibly slowed now as builders face higher borrowing costs.... which could fuel future home price inflation.

With interest rates that have doubled since the beginning of the year, evaluate all your financing options. A 30-year fixed mortgage may not be the best fit. Discuss with lenders what programs they have, including rate buy downs, adjustable rates, and “no lender fee” refinancing (if a recession is indeed coming the FED usually lowers rates to stimulate growth). It is entirely possible that renting and waiting for prices to fall could ultimately cost you more even if you do pay less for the house in the future.

In the current market, over-bidding has greatly reduced. By not over-bidding those saved dollars may absorb some higher borrowing costs.

Focusing on the best quality is always smartest. And now you may have more choices. Buying a quality home for a fair price is always smarter than a bargain price for a bargain.

During fearful times, going against the herd mentality of 'wait and see' often produces excellent opportunities...... a market that’s normalizing and a Fall selling season that’s ending mean that buyers can get great deals from eager sellers who want to sell their properties before the year ends.

Markets don’t stop.

For many homeowners, objectives such as lifestyle, location and longer-term equity growth are more important than waiting for unknown future market movement to occur.

So, the best time to purchase a home is whenever you can afford it.

Are you, or someone you know, ready to move?

Let me know - I can help.