No Worries… Home Prices Coming in for a SOFT Landing

Home prices have appreciated considerably over the last five years. This has some concerned that we may be in for another dramatic correction. However, recent statistics suggest home values will not crash as they did a decade ago. Instead, this time they will come in for a soft landing.

The previous housing market was fueled by an artificial demand created by mortgage standards that were far too lenient. When this demand was shut off, a flood of inventory came to market. This included heavily discounted distressed properties (foreclosures and short sales).

Today’s market is totally different. Mortgage standards are tighter than they were prior to the last boom and bust. There is no fear that a rush of foreclosures will come to market. The Mortgage Bankers’ Association just announced that foreclosures are lower today than at any time since 1996.

Case Shiller looks at the percentage of appreciation as compared to the same month the year prior. Here is a graph of their findings over the last ten months:

No Worries… Home Prices Coming in for a SOFT Landing | MyKCM

 

As we can see, home price appreciation is softening as more inventory comes to market. This shows that real estate prices are not crashing, but merely returning toward historic appreciation numbers of 3.6% annually.

Bottom Line

Home prices are leveling off. Long term, that is a good thing for the housing market.

WRITTEN BY:

Exceptional Negotiator – No one fights harder for You! The best tools, exceptional marketing, & personal service, to achieve the best results for you. I am a pleaser! I am at my best when I am helping others. I started off early in life working on houses, from simple electrical issues to small patch jobs. Over the years I have built a number of homes, stick to ICF (Insulated Concrete Block), installed rocks walls, patios, decks, ponds with water falls, and underground irrigation systems. Figuring out how to fix or make something better is a challenge I welcome. For the last 25+ years I have owned a few large format printing companies, an outdoor advertising company, and a property management company. Today I am CAM (Community Association Management) certified, allowing me to manage Condominiums Associations and Home Owners Associations. I use the Matterport 3D Virtual Reality camera system – allowing me to capture your property and bring the full “Walk Through” experience of your property to the on-line world. I also use the industries best Drone systems, and I am Federal Drone Commercial Certified – allows me to fly a Drone and film your property from up to 400′ in the air. Please go to the 3DSellsMore tab for more details on the Matterport and the Drone Services.

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