I agree with others, wait and rent. I feel like this housing market has topped out in many areas and is about to in others. I believe the housing market is in for a fairly long plateau if not a small dip in the short term. Inflation is going to start to bite into the ability/confidence for a swath of the potential buyers in this market. I'm starting to see changes in my area with respect to how things are going in another sellers market...the auto market. Even just a few months ago, most of the auto dealer lots were less than 25% full. Yesterday I noticed the most inventory that I've seen since the supply side fell out of that market. I'm not saying that the inventory for housing market is about to explode, but I do think a segment of the market is going to drop out.
What would you do? Housing market stress!
- Thread starter Immadismom
- Start date
CaptainAmerica
DIS Veteran
- Joined
- Oct 12, 2018
There's no reason to believe that's the case.
CaptainAmerica
DIS Veteran
- Joined
- Oct 12, 2018
When home prices fall but interest rates rise, mortgages don't get any cheaper.
Realtors may tend to say things to help maximize their profits regardless of what is right for you. Them encouraging you join a bidding war for a certain house is something I would avoid. Buying right now if you don't have to (i.e. job relocation, etc.) when prices are clearly over-heated in many markets is a bad idea. I agree with others that renting is a good option until the markets cool off. Regardless of why prices suddenly jumped doesn't change the reality that it is not sustainable and prices will likely flatten or even decline significantly for many of the same reasons.
LuvOrlando
DIS Veteran
- Joined
- Jun 8, 2006
I agree to rent again in an area you'd like to buy, better off losing a small amount in temporary rent than a giant amount in permanent purchase, besides you get a chance to test the waters & explore in the neighborhood you think you'd like to make sure it's what you think it is.
Christine
DIS Veteran
- Joined
- Aug 31, 1999
I think it's a mistake to buy a house at the top of a real estate bubble and to be so under pressure. This is one of the most important purchases you'll ever make and it's not easy to move on if it's the wrong decision. That can cost you money right there due to sunk settlement costs. Do not buy something under pressure unless perfection happens in the meantime. Find another rental, relax, and wait until things calm down. Maybe next year.
We are not in a housing bubble. Waiting thinking that prices are going to collapse is a big mistake. Supply is very low and not likely to increase anytime soon. The economy is doing very well and there are plenty of jobs available.
Rising interest rates will be a headwind for the housing market, force some buyers to drop out of the market, and will cause housing prices to moderate as a result. We've seen this phenomenon again and again over the last fifty years. This time will be no different. An additional factor this time around is going to be uncomfortably high inflation...possibly 10% by this summer....more downward pressure on demand.
CaptainAmerica
DIS Veteran
- Joined
- Oct 12, 2018
Housing doesn't have a demand problem, it has a supply problem. Inflation is making new construction prohibitively expensive, putting upward pressure on prices for existing housing stock.
Mackenzie Click-Mickelson
Chugging along the path of life
- Joined
- Oct 23, 2015
In my area new construction is fine, houses have been taking longer to build due to construction materials but they are being built. However they are being built in the unaffordable bracket (which has been the case long before the pandemic). Developers who do new neighborhoods don't want their profits to be impacted much by building homes on the more affordable track.
New apartment complexes built are also being built in the unaffordable bracket. That includes new townhouses. Both of which has been the case long before the pandemic. Cities in my county are unfortunately not putting pressure on developers to build more affordable price points. There have been successful campaigns from citizens of the cities to block certain developments (usually high density ones or ones where the natural landscape is completely destroyed) and that is both a good and bad thing for supply.
There's not enough supply def. but there's also a demand that is not being met by by any supply that gets there. The population here in my metro has gained as rural areas lose people so homeowners looking to sell still largely want to stay in the metro but then they are added into the market. Those who want to rent are finding this more and more difficult.
But I'm also not confident that an increase of interest rates is going to suddenly solve our issue here in our metro. It's been an existing long-term issue brought on by past decisions.
But many will probably learn what it means to be stuck with an underwater mortgage, along with a higher assessed property tax bill.
I understand that. What I'm saying....is that housing isn't going to have a supply problem for much longer.....because demand is going to drop off and houses will be on the market longer and supply will build. Demand will drop because a percentage of buyers will be priced out, due to the cost of the house itself, the increase in rates on the loans to buy the house and rising prices overall due to very high inflation. It's just simple supply and demand. I'm not saying that the bottom is going to fall out Ala' 2008-09....but the market will cool. I would not buy a house in this market, especially in the markets that are still relatively hot.....unless I was prepared to stay for a minimum of ten years. I wish DH and I were just 2-3 years closer to selling our house because I'd sell it....and rent until we retire.
Exactly....this is what is going to happen to some people. Again, hopefully not nearly as bad as in 08-09, but it will trap some people for sure.
HopperFan
"It's a bug-eat-bug world out there, princess."
- Joined
- Sep 6, 2003
EXACTLY THIS^
CaptainAmerica
DIS Veteran
- Joined
- Oct 12, 2018
That's easy to say when you don't have a lease expiring.
CaptainAmerica
DIS Veteran
- Joined
- Oct 12, 2018
As long as you can afford the underwater mortgage, it's still cheaper than renting.
It is easy to say....just continue to rent. The OP indicates in the original post that they feel like the houses that they are looking at are overpriced. The market is what it is....when a seller and buyer agree on a price. However, the rise in prices in this market is unsustainable. Up 25% in 2021 alone....in an industry where we typically see 3-4% a year. When I read the OP's post...I see someone trying to force a square peg into a round hole. It's hard to resist the house fever frenzy that is still going on out there....but patience will pay off in this environment.
Share this page
GET A DISNEY VACATION QUOTE
Dreams Unlimited Travel is committed to providing you with the very best vacation planning experience possible. Our Vacation Planners are experts and will share their honest advice to help you have a magical vacation.
Let us help you with your next Disney Vacation!
Dreams Unlimited Travel is committed to providing you with the very best vacation planning experience possible. Our Vacation Planners are experts and will share their honest advice to help you have a magical vacation.
Let us help you with your next Disney Vacation!
