The Expert Podcast

As 2021 comes to a close everybody looks back and sees that the real estate market has spiked dramatically in the last 12 to 18 months and a lot of people are wondering is it a good time to buy is are the prices going to crash are they going to go up and if you're on the fence about buying a buying a piece of real estate buying a home you might be interested to know what is the future hold and obviously nobody knows the future but you can get some good um insight from observations not just opinions that somebody has but what are the facts and data behind it.
And here's two articles one from fortune one from the wall street journal both very highly respected financial publications and you don't want to use just one source and even the opinion prices are forecast to shift but not just the answer that they are going to shift but why what's the why behind it and here's a map of the u.s showing that in almost every area they're seeing prices are going to go up how much realtor.com predicts u.s home prices will rise in 2022 when all these areas are rise from two to eight percent.
The question is why do they think that why do they think they're gonna rise and whether it's you know providence rhode island forecasted jump nine percent or stockton california seven percent the reasons behind that is because there are fewer listings and even going to be fewer in the future because of the shortage of homes and the fact that more people are getting into the market now they don't foresee prices falling in any of the hundred largest markets it'll it predicts that sales will decline but if you look at those two facts prices are not going to fall but sales volume will fall what does that mean well it means that there's not going to be enough houses people aren't going to be able to find a house just like they have been in the last year it all boils down to supply and demand mis match.
There's a five year period where the five largest millennial birth years will hit the first time buying age of 30. think about that from we're right in the middle 2019 to 2023 the five largest birth years for millennials 89 through 93 are going to turn 30. right many of these people were crushed in the 2008 housing bust and builders played a conservative over the last decade and didn't build the number of homes that are needed to meet that demographic wave so for the last 10 15 years builders were not building houses because they got hammered in 2008 and they got stuck with homes but at the same time a lot of people were coming into home buying age.
So according to the federal government freddie mac that the us is under built by four million homes other surveys say it's closer to 5 million that explains how housing inventory hit a 40-year low of inventory what does that mean for for data well according to wall street journal sales are on track for the best year since 2006 fastest pace in 10 months and the bigger picture is that even month over month it's accelerating it's not just year over year like the last month it went up again the median existing home price went up 13.9 percent from a year earlier 14 from 2020.
Well there's a big reason for that because prices were flat from 2008 to let's say 2018 for 10 years there's they're playing catch up it's partially pandemic partially people wanting homes but there's a big catch up of appreciation because for 10 years houses were flat we definitely still have way more buyers than houses said a real estate broker in indiana this is not la or new york it's indiana.
So keep in mind if you're looking at the housing market going forward and you look at some of our other videos you're going to see that the prediction is it could be the next 10 years prices are going to go up dramatically so if you are in the market but you're not exactly sure where you want to live or maybe you don't want to jump into that permanent house you can look at some cheaper alternatives at least get something better than an apartment hang out there for a few years at least you'll be riding the wave of upswing so you don't get locked out of the housing market in the future.
Because right now um there are 50 people looking at the same three houses according to these people um talking about with a budget 250 they shop for homes listed below 220 so they can make an offer above the listing price there's houses out there you'll see on our website and on our video that there are many many houses out there if you look just below what most people want to get you may find a lot more opportunity than trying to find to hit the sweet spot of where everybody wants to find a house from 250 to 350. looking houses that are in the hundreds may not be the most ideal place to live but you can flip them for a profit and then get a more upgraded house down the road.