It seems like when you turn on the news or go onto social media, the economy is always a primary topic of conversation. People want to stake their claim at being experts, offering opinions on the future. Most of the chatter of late has been more about how the housing market and the economy will have a decline. Some say a correction while others are gearing up for a recession. One would think the way they keep talking about it that they might actually be hoping for one as crazy as that sounds.
Actually, some people are hoping for a recession believe it or not. Why would that be? Well consider this, if you have a stable job and reliable income, maybe even some money saved up as well, a recession means prices drop at a time when you’ve got reliable money. That means homes, cars and plenty of other things will be heavily discounted compared to where they are now.
Will Home Prices Drop?
The common belief is that home prices will drop. Many believe that we can see sales start to slow down over the summer, which is not a shock, but then continue to slump through the rest of the year. As sales drop, even a low inventory will not be enough to keep prices from falling a bit.
Also, you have to consider the fact that with the market being so hot for so long, a cool down period is needed, even if it’s a short one. That’s the option most people are expecting. Whether it’s technically a correction or even a recession, most expect and slow down to be a simple adjustment to a crazy last three years of rising home prices which should only last a year or two.
Why Might They Drop?
There are several additional factors that may cause prices to drop. Yes, sales have been hot, inventory has been low and prices have been skyrocketing for years. However, prices have been going up too fast and have helped fuel record inflation rates.
This, combined with increased interest rates is creating the expectation of a real estate market cool off. While the interest rates are actually being raised to literally slow down the market, the question is how effective will that strategy be?
What Are Your Options?
Real estate and finance are tricky situations because you cannot expect to get direct answers from online resources. Instead, try working with experts, many of whom offer a free consultation and will give you their professional recommendation on what you should do. The right realtor can make a world of difference and show you options you never thought you had.
While you may think that now is not the time to sell because of prices potentially dropping, the right realtor can flip that thinking based on years of experience. For example, the Tacoma Washington real estate market currently has a lower inventory than in years past. While prices may not be moving forward, they are yet to drop and may not. You may have the opportunity to take advantage of higher prices before they drop but the only way to know for sure is to contact a realtor today.