Real Estate is Going to Crash!!!!

The headline above is something I've been seeing for the last 18 months and it can only be described as "click bait".

Ever since interest rates increased from the historic lows that they were at during COVID, keyboard Nostradamus' have been predicting the next, great real estate CRASH!!!! And, to be honest, at some point there could be a crash, but that isn't what the statistics are telling us and not what I'm seeing, and definitely not what I hear from the true experts in the field.

The graph below is the average sale price in my core area over the last 12 months. (Imagine a 60 mile radius around Columbia, TN.) What you see is that the average sales price of homes made its regular decline during the slower winter months and then rose throughout the spring and summer months to once again set record high home prices.

The facts are these: there are still lots of people moving to Middle Tennessee, prices are continuing to increase, inventory has increased but not fast enough, there is a record low number of transactions being completed, interest rates are higher than COVID but are below the average mortgage rate since they have been tracked since 1971. (7.38%)

What I think will happen: rates will stay in this current range 6-7% for the foreseeable future, if they go lower demand will increase and we will see greater price increases, if they stay the same we will continue to see mild to moderate price increases. But in my opinion, either way, you will likely pay more for a house one year from now than you will today.

I've been excited to get the opportunity to work with several first time home buyers over the past few weeks. I had noticed a slow-down in the number of first time home buyers that were entering the market over the past year or so.

I would imagine that a big portion of this was tied to interest rates as well as likely some influence from what we see in the media. No matter what is causing the shift, I'm glad to see it, because, in my opinion, if you're ready to buy your first home, then now is the right time to do it! Buy the home when you are ready, not when someone or something tells you it's the right time.

Buying your first home can seem daunting but in all reality you just need the right advocate and guide to help you navigate the process. If I don't feel like you are ready to buy your first home, I will tell you just that! I don't ever want to see my clients get in a bad position.

Looking for an overview of the home buying process? I use the graphic below to help first time home buyers get an idea of what lays ahead. If you're thinking about buying your first home or just have questions don't hesitate to reach out. I am here to help!

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