The real estate market is one of America’s strongest sources of wealth – and it drives many aspects of our economy (like consumer spending) while keeping financial institutions profitable. Given the importance of the real estate industry to our country’s financial health, logic would dictate that professional analysts and economists would generally agree on where the market currently stands and what will happen next.
Conversely, opinions are split pretty much right down the middle; between those who believe that the market is just now entering a period of full recovery from a devastating housing crisis – and those who believe we’re on the verge of yet another one. It comes down to a matter of opinion, as strong arguments can be made on both sides of this issue.
The Juxtaposition of a Fluctuating Market
For those who believe in the market, their reasoning is well-founded. New home sales have reached their highest level since 2008 – and in some areas sales prices are up more than 20 percent as well! Some of the cities with the largest gains include Miami (up 10.1%) and Seattle (10.6%); both markets have benefited substantially from higher sales to international investors.
Intention to buy a home is also more prevalent; wages are slowly increasing and the labor market is growing strong. These 3 aspects alone are allowing people to afford and purchase homes. With easier access to home ownership, more first time buyers are entering the real estate market (making it easier for people to sell).
The mortgage industry has also loosened up its borrower requirements, with more products featuring attractive interest rates and low down payments – and a strong possibility of returning to the zero-percent down payment very soon.
Though ‘no money down’ was one of the big problems contributing to the housing bubble 10 years ago, we’re not there yet. Down payment percentages are still very low, encouraging people to buy homes rather than rent.
Think Positive and Flip Your Results
There may be certain factors indicating that now is not the right time to buy or invest in the real estate market – but many experts feel now is the best time.
Perhaps one of the biggest challenges we’re currently facing is simply the lack of available real estate, and of course supply and demand are factors which affect valuation and appreciation. Because the inventory of homes has been slowly dwindling, the result has been a significant rise in sales prices – making it difficult for many buyers to enter the market.
The good news is that these opposing factors do leave the door open for real estate investors who are willing to learn how to make money in this unique real estate market.
When you’re able to think outside the box and find distressed properties and motivated sellers experiencing such things as bankruptcies, pre-foreclosures, and tax delinquencies – you can profit from the high demand and sell any property at the right price without much marketing effort.