In these uncertain times many of my clients are asking my opinion on what the real estate market is going to do. I’m not an economist or a doctor, I don’t like to make predictions or speculate. But what I can do is pull comps. Here are some great historical numbers to help us compare this situation to past events. These numbers were put together by Keeping Current Matters, an informative real estate website. Should we go into a recession, one fear is that the real estate market will crash just as it did in 2008. Lawrence Yun, Chief Economist of the National Association of Realtors stated this Sunday, “During the last recession, real estate was on wobbly ground with loose lending and too much supply. Today, there is no subprime lending and too little supply. The real estate market will hold on much better.”
This 1st slide shows how the past 5 recessions did not always result in lowered home values. Home values actually rose 3 out of the 5 recessions. 2008 was an anomaly, and should we go into a recession, the current housing market has many necessary ingredients to remain strong. Interest rates are at a historic low, housing inventory is low, and home appreciation has actually been slower the past 6 years than it was leading up to 2008. These are all great qualities to prepare real estate to survive whatever is ahead of us. Definitely no guarantees, but it is reassuring.
As a real estate agent my job has always been to represent my client as best I can. To get them the best deal possible with the best terms and provide them with great service. But now I have to take a moment and go deeper, do more. Today I’ll be calling my clients to address their fears and concerns, and helping to lay out a plan that better addresses their needs. Some sellers may want to take their home off the market, and that’s fine. Others may want to discuss alternative measures on how to conduct showings, such as virtual tours. We’ll definitely be asking all buyers to remove shoes and refrain from touching objects other than door knobs. Buyers may be concerned about their future income, and whether they will have enough cash on hand for down payments, or whether their new home will be an investment or a mistake. We’ll be going through this together, and I’m not going to pretend to have all the answers. But as we all navigate these strange times it’s great to be working in a profession where, even though we may be stuck in our homes, we can still reach out and make an impact just by picking up the phone.
-Chris Bradford, Bradford Real Estate
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