In this month’s edition of “Reactions”, we’re taking a look at an article with a misleading headline about the real estate market from Fortune Magazine online, “The U.S. housing market to see second biggest correction of the post-WWII era—when to expect the home price bottom”.
A Misleading Headline in Real Estate
Hey it’s your favorite bearded realtor, Eren Millam with Premiere Property Group. Today, we’re going to be reacting to yet another misleading headline about real estate. We see so many like it and it’s so misleading that it’s making people go crazy with the wrong information. It’s time to address it, so let’s do that right now!
The Second Biggest Correction of Post WW2 Era
Are we headed for the second biggest correction as the title of the article suggests? Looking at this headline, holy smokes, I am getting flashbacks to our last market correction in 2007/2008. Fortunately, that is NOT the case based on any stats I’m seeing, nor is it as bad in the article as the headline makes it seem. Let’s read on.
The 2007-2008 Collapse
According to the article, all the signs and data pointed to a massive correction. However, while we could see the signs, we’d never experienced anything like that since the end of WW2. Because of this, nobody expected or believed what actually occurred, except for maybe this guy. The point the article is trying to make is that we are seeing similar signs. We’re going to see a similar crash and it’s going to be horrific just like it was in 07/08. However, hidden in the body of the article is one sentence, that the projection is a 7.5% correction as compared to a 27% nationwide correction like the one nearly 15 years ago.
Lewis County Real Estate Projections
In Lewis County, the real estate market corrected about 24-25% in 2007-08. We did see a slide in prices from July-September, however, you may have missed that prices went up in October. If you’re looking at the stats, like I have been, this was not a shock. We lose about 50-60% of inventory each winter so demand, which is lower than at the beginning of the year, is now higher than supply. We expect prices to remain stable or increase unless the interest rates keep going up. It’s not so much that rates are going up as it is that buyers are waiting for the rates to stabilize. Experts are projecting the rates to peak at 8% before lowering to around 5% by the middle of 2024.
This means that you have to price your home correctly. It is still a seller’s market, so you should not be giving up a ton of your equity in price reductions or buyer concessions. Homes are taking much longer to sell so adjust your expectations accordingly.
I know the interest rates are scary, but sellers are giving up a ton of equity and discounts! Ask them to pay your closing costs. Ask them to buy down your interest rate. Sellers are reeling trying to catch up from the market and they’re not informed by the listing agent. Get out there and take advantage!
If you’re thinking of buying or selling your home in the west Lewis County area, contact me today! I’d love to hear from you! Eren Millam – Managing Broker Premiere Property Group, LLC WA License No. 26933
Chehalis, WA 98532 | Centralia, WA 98531 | Adna, WA | Napavine, WA | Onalaska, WA 98570 | Rochester, WA 98579 | Vader, WA 98593 | Winlock, WA 98596 | Boistfort, WA
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