I do get this question a lot these days. And the quick answer is ‘no’. However, the trajectory is definitely starting to flatten and the market is slowing down, particularly when compared to the dizzying highs of recent years.
As always, Real Estate is local. The trends most people care about are in the neighborhood where they are selling or buying. Your zip code and price range will best determine to what extent you feel the market flattening and slowing. For example, we are starting to finally accumulate inventory in the higher end (over $1.8M) markets of suburbs such as Lexington and Winchester. However if you are looking to buy for under $1.6M, in these same areas, you might still be saying – Whoa, where exactly is that slow-down?
Similar to the stock market – emotions and consumer confidence have a lot to do with the Real Estate market. So while no one has a perfect crystal ball – savvy customers need to keep the fundamentals in mind when contemplating their real estate needs:
- There are always buyers and sellers: Buying and selling Real Estate goes on through market upswings and downswings and in every season. The cycle of life continues – and so does the buying and selling of real estate – as people continue to start jobs, marry, get larger families, upsize, retire and downsize. Remember you only need one good buyer if you’re selling and one suitable house if you’re buying to get the deal done.
- Unemployment is still at an all time low in the greater Boston area –even though wages have remained relatively flat, we are at least not hurting from lost jobs and new hires continue to move to the area.
- Mortgage interest rates are at an all time low. Just ask someone who remembers financing a home with double digit mortgage interest rates (from 1979-1990!)
- Year over year returns for real estate, at least in most of the suburbs and parts of the city that I work in, are still showing a healthy trajectory– and have done so for many years. A slight correction is not a bad thing, given how prices have been on a tear till recently. This makes it easier for people to actually afford the homes they buy – and is healthier for the economy.
- Inventory is still pretty low – in all but the highest price ranges. This is because many empty nesters are still waiting it out in their larger homes, rather than downsizing. While more and more of the millennial generation are coming of age and waiting in the wings to buy their first homes.
Top take-away for sellers: Get on with it. There is no reason to wait while it is still a Sellers Market and the fundamentals are good. Why wait to see what tomorrow brings when today is great already? Also, be sure to price your home correctly to sell in today’s market or you may end up chasing a pipe dream.
Top take-away for buyers: Strike while the cost of mortgage financing is low, most parameters are good and the sellers are eager to get the deal done before winter sets in. Be vigilant and realistic, and you could finally get that home you have been waiting for.
As always, I would love to help with your real estate needs or answer any questions you, or your friends, may have – so do not hesitate to call or reach out.
Best wishes and talk soon!