Why Today’s Housing Market Is Not About To Crash

Why Today’s Housing Market Is Not About To Crash

Why Today’s Housing Market Is Not About To Crash

There’s been some concern lately that the housing market is headed for a crash. And given some of the affordability challenges in the housing market, along with a lot of recession talk in the media, it’s easy enough to understand why that worry has come up.

But the data clearly shows today’s market is very different than it was before the housing crash in 2008. Rest assured, this isn’t a repeat of what happened back then. Here’s why.

It’s Harder To Get a Loan Now

It was much easier to get a home loan during the lead-up to the 2008 housing crisis than it is today. Back then, banks had different lending standards, making it easy for just about anyone to qualify for a home loan or refinance an existing one. As a result, lending institutions took on much greater risk in both the person and the mortgage products offered. That led to mass defaults, foreclosures, and falling prices.

Things are different today as purchasers face increasingly higher standards from mortgage companies. The graph below uses data from the Mortgage Bankers Association (MBA) to show this difference. The lower the number, the harder it is to get a mortgage. The higher the number, the easier it is.

Unemployment Recovered Faster This Time

While the pandemic caused unemployment to spike over the last couple of years, the jobless rate has already recovered back to pre-pandemic levels (see the blue line in the graph below). Things were different during the Great Recession as a large number of people stayed unemployed for a much longer period of time (see the red in the graph below):

Here’s how the quick job recovery this time helps the housing market. Because so many people are employed today, there’s less risk of homeowners facing hardship and defaulting on their loans. This helps put today’s housing market on stronger footing and reduces the risk of more foreclosures coming onto the market.

There Are Far Fewer Homes for Sale Today

There were also too many homes for sale during the housing crisis (many of which were short sales and foreclosures), and that caused prices to fall dramatically. Today, there’s a shortage of inventory available overall, primarily due to years of underbuilding homes.

The graph below uses data from the National Association of Realtors (NAR) and the Federal Reserve to show how the months’ supply of homes available now compares to the crash. Today, unsold inventory sits at just a 2.6-months’ supply. There just isn’t enough inventory on the market for home prices to come crashing down like they did in 2008.

Equity Levels Are Near Record Highs

That low inventory of homes for sale helped keep upward pressure on home prices over the course of the pandemic. As a result, homeowners today have near-record amounts of equity (see graph below):

And, that equity puts them in a much stronger position compared to the Great Recession. Molly Boesel, Principal Economist at CoreLogic, explains:

Most homeowners are well positioned to weather a shallow recession. More than a decade of home price increases has given homeowners record amounts of equity, which protects them from foreclosure should they fall behind on their mortgage payments.”

Bottom Line

The graphs above should ease any fears you may have that today’s housing market is headed for a crash. The most current data clearly shows that today’s market is nothing like it was last time.

Marty Gale

Buy or Sell with Marty Gale

"Its The Experience"

Principal Broker and Owner of Utah Realty™

Licensed Since 1986

CERTIFIED LUXURY HOME MARKETING SPECIALIST (CLHM)
PSA  (Pricing Strategy Advisor)
General Contractor 2000 (in-active)
e-pro (advanced digital marketing) 2001
Certified Residential Specialist 2009
Certified Negotiation Expert 2014
Master Certified Negotiation Expert 2014
Certified Probate Specialist Since 2018
Senior Real Estate Specialist
Certified Divorce Specialist CDS

Contact me! 

 

 

Cinco de Mayo -Mexican Independence Day!

Cinco de Mayo -Mexican Independence Day!

Today is Cinco de Mayo May 5th Happy Cinco de Mayo!

Cinco de Mayo is a holiday that is celebrated in the United States every year on May 5th. While many people associate the holiday with Mexican Independence Day, which is actually celebrated on September 16th, Cinco de Mayo has a different meaning and history.

The holiday commemorates the Mexican army’s victory over the French at the Battle of Puebla on May 5, 1862. At the time, Mexico was in a state of financial crisis and had defaulted on its debts to several European countries, including France. In response, France sent troops to Mexico to demand payment and establish a French-controlled government.

Despite being outnumbered and outgunned, the Mexican army, led by General Ignacio Zaragoza, was able to defeat the French forces in a decisive battle at Puebla. While the victory did not end the French occupation of Mexico, it was a significant morale boost for the Mexican people and helped to rally support for the resistance movement.

So why is Cinco de Mayo celebrated in the United States? While the holiday is not widely celebrated in Mexico outside of the state of Puebla, it has become a popular cultural celebration in the United States, particularly in areas with large Mexican-American populations.

In the United States, Cinco de Mayo is often celebrated with parades, festivals, and parties that feature traditional Mexican food, music, and dance. It has become a way for Mexican-Americans to celebrate their heritage and culture, and for non-Mexican Americans to learn more about Mexican history and traditions.

However, it’s worth noting that Cinco de Mayo has also been criticized for being overly commercialized and for perpetuating stereotypes about Mexican culture. Some have argued that the holiday has become more about drinking and partying than about honoring the historical significance of the Battle of Puebla.

Regardless of how you choose to celebrate Cinco de Mayo, it’s important to remember the holiday’s historical roots and to appreciate the contributions of Mexican-Americans to American culture and society. By learning more about the meaning and history of the holiday, we can all gain a greater appreciation for the diversity and richness of our shared cultural heritage.

How Homeowners Win When They Downsize

How Homeowners Win When They Downsize

How Homeowners Win When They Downsize

Downsizing has long been a popular option when homeowners reach retirement age. But there are plenty of other life changes that could make downsizing worthwhile. Homeowners who have experienced a change in their lives or no longer feel like their house fits their needs may benefit from downsizing too. U.S. News explains:

“Downsizing is somewhat common among older people and retirees who no longer have children living at home. But these days, younger people are also looking to downsize to save money on housing . . .”

And when inflation has made most things significantly more expensive, saving money where you can has a lot of appeal. So, if you’re thinking about ways to budget differently, it could be worthwhile to take your home into consideration.

When you think about cutting down on your spending, odds are you think of frequent purchases, like groceries and other goods. But when you downsize your house, you often end up downsizing the bills that come with it, like your mortgage payment, energy costs, and maintenance requirements. Realtor.com shares:

“A smaller home typically means lower bills and less upkeep. Then there’s the potential windfall that comes from selling your larger home and buying something smaller.”

That windfall is thanks to your home equity. If you’ve been in your house for a while, odds are you’ve developed a considerable amount of equity. Your home equity is an asset you can use to help you buy a home that better suits your needs today.

And when you’re ready to make a move, your team of real estate experts will be your guides through every step of the process. That includes setting the right price for your house when you sell, finding the best location and size for your next home, and understanding what you can afford at today’s mortgage rate.

What This Means for You

If you’re thinking about downsizing, ask yourself these questions:

  • Do the original reasons I bought my current house still stand, or have my needs changed since then?
  • Do I really need and want the space I have right now, or could somewhere smaller be a better fit?
  • What are my housing expenses right now, and how much do I want to try to save by downsizing?

Once you know the answers to these questions, meet with a real estate advisor to get an answer to this one: What are my options in the market right now? A local housing market professional can walk you through how much equity you have in your house and how it positions you to win when you downsize.

Bottom Line

If you’re looking to save money, downsizing your home could be a great help toward your goal. Let’s connect to talk about your goals in the housing market this year.

Marty Gale

Buy or Sell with Marty Gale

"Its The Experience"

Principal Broker and Owner of Utah Realty™

Licensed Since 1986

CERTIFIED LUXURY HOME MARKETING SPECIALIST (CLHM)
PSA  (Pricing Strategy Advisor)
General Contractor 2000 (in-active)
e-pro (advanced digital marketing) 2001
Certified Residential Specialist 2009
Certified Negotiation Expert 2014
Master Certified Negotiation Expert 2014
Certified Probate Specialist Since 2018
Senior Real Estate Specialist
Certified Divorce Specialist CDS

Contact me! 

 

 

What’s in store for the Housing Market for the rest of 2023, and beyond?

What’s in store for the Housing Market for the rest of 2023, and beyond?

What’s in store for the Housing Market for the rest of 2023, and beyond?

According to industry experts, the housing market is expected to remain strong in the coming years, with steady demand and limited supply driving up prices. This trend is likely to continue into 2023, with some analysts predicting a further increase in home prices.

 

However, there are also some factors that could potentially impact the housing market in the next few years. For example, rising interest rates could make it more difficult for some buyers to afford a home, which could lead to a slowdown in demand. Additionally, changes in government policies or economic conditions could also have an impact on the market.

 

For home buyers, it’s important to keep these factors in mind when considering a purchase. While the current market conditions may be favorable, it’s important to think long-term and consider how changes in the market could impact your investment.

 

For home sellers, the current market conditions may present an opportunity to sell at a higher price. However, it’s important to be realistic about pricing and work with a trusted real estate agent to ensure a successful sale.

 

Overall, the housing market is expected to remain strong in the coming years, but there are always factors that could impact the market. By staying informed and working with trusted professionals, both buyers and sellers can navigate the market with confidence.

#utahrealty #utahrealestate #martygale

 

Marty Gale

Buy or Sell with Marty Gale

"Its The Experience"

Principal Broker and Owner of Utah Realty™

Licensed Since 1986

CERTIFIED LUXURY HOME MARKETING SPECIALIST (CLHM)
PSA  (Pricing Strategy Advisor)
General Contractor 2000 (in-active)
e-pro (advanced digital marketing) 2001
Certified Residential Specialist 2009
Certified Negotiation Expert 2014
Master Certified Negotiation Expert 2014
Certified Probate Specialist Since 2018
Senior Real Estate Specialist
Certified Divorce Specialist CDS

Contact me! 

 

 

Ways To Overcome Affordability Challenges in Today’s Housing Market

Ways To Overcome Affordability Challenges in Today’s Housing Market

Ways To Overcome Affordability Challenges in Today’s Housing Market

Some Highlights

  • With so few homes on the market right now, widening the scope of your search to include nearby areas could help you find more options in your budget.
  • You can also work with a trusted lender to consider alternative financing options and search for down payment assistance.
  • If you’ve been searching for a home but are concerned about rising costs, make sure you have a team of trusted real estate professionals for expert advice.
Why Today’s Foreclosure Numbers Are Nothing Like 2008

Why Today’s Foreclosure Numbers Are Nothing Like 2008

Why Today’s Foreclosure Numbers Are Nothing Like 2008

You’ve likely seen headlines about the number of foreclosures climbing in today’s housing market. That may leave you with a few questions, especially if you’re thinking about buying a house. Understanding what they really mean is mission-critical if you want to know the truth about what’s happening today.

According to a recent report from ATTOM, a property data provider, foreclosure filings are up 6% compared to the previous quarter and 22% since one year ago. As media headlines call attention to this increase, reporting on just the number could actually generate worry and may even make you think twice about buying a home for fear that prices could crash. The reality is, while increasing, the data shows a foreclosure crisis is not where the market is headed.

Let’s look at the latest information with context so we can see how this compares to previous years.

It Isn’t the Dramatic Increase Headlines Would Have You Believe

In recent years, the number of foreclosures has been down to record lows. That’s because, in 2020 and 2021, the forbearance program and other relief options for homeowners helped millions of homeowners stay in their homes, allowing them to get back on their feet during a very challenging period. And with home values rising at the same time, many homeowners who may have found themselves facing foreclosure under other circumstances were able to leverage their equity and sell their houses rather than face foreclosure. Moving forward, equity will continue to be a factor that can help keep people from going into foreclosure.

As the government’s moratorium came to an end, there was an expected rise in foreclosures. But just because foreclosures are up doesn’t mean the housing market is in trouble. As Clare Trapasso, Executive News Editor at Realtor.com, says:

There’s no reason to panic, at least not yet. Foreclosure filings began ticking up . . . after the federal foreclosure moratorium ended. The moratorium was enacted in the early days of COVID-19, when millions of Americans lost their jobs, to prevent a tsunami of homeowners losing their properties. So some of these proceedings would have taken place during the pandemic but got delayed due to the moratorium. This is a bit of a catch-up.”

Basically, there’s not a sudden flood of foreclosures coming. Instead, some of the increase is due to the delayed activity explained above while more is from economic conditions. As Rob Barber, CEO of ATTOM, explains:

This unfortunate trend can be attributed to a variety of factors, such as rising unemployment rates, foreclosure filings making their way through the pipeline after two years of government intervention, and other ongoing economic challenges. However, with many homeowners still having significant home equity, that may help in keeping increased levels of foreclosure activity at bay.”

To further paint the picture of just how different the situation is now compared to the housing crash, take a look at the graph below. It shows foreclosure activity has been lower since the crash by looking at properties with a foreclosure filing going all the way back to 2005.

While foreclosures are climbing, it’s clear foreclosure activity now is nothing like it was during the housing crisis. In addition to all of the factors mentioned above, that’s also largely because buyers today are more qualified and less likely to default on their loans.

Today, foreclosures are far below the record-high number that was reported when the housing market crashed.

Bottom Line

Right now, putting the data into context is more important than ever. While the housing market is experiencing an expected rise in foreclosures, it’s nowhere near the crisis levels seen when the housing bubble burst, and that won’t lead to a crash in home prices.

Marty Gale

Buy or Sell with Marty Gale

"Its The Experience"

Principal Broker and Owner of Utah Realty™

Licensed Since 1986

CERTIFIED LUXURY HOME MARKETING SPECIALIST (CLHM)
PSA  (Pricing Strategy Advisor)
General Contractor 2000 (in-active)
e-pro (advanced digital marketing) 2001
Certified Residential Specialist 2009
Certified Negotiation Expert 2014
Master Certified Negotiation Expert 2014
Certified Probate Specialist Since 2018
Senior Real Estate Specialist
Certified Divorce Specialist CDS

Contact me! 

 

 

Market Update for Real Estate in Salt Lake County 2023

Market Update for Real Estate in Salt Lake County 2023

 

Market Update for real estate in Salt Lake County 2023

As we approach 2023, the real estate market in Salt Lake County is showing no signs of slowing down. In fact, experts predict that the market will continue to be strong, with steady growth in both home prices and sales volume.

 

One of the main factors driving the real estate market in Salt Lake County is the area’s strong economy. With a low unemployment rate and a diverse range of industries, Salt Lake County is an attractive place to live and work. This has led to a steady influx of new residents, which in turn has driven up demand for housing.

 

Another factor contributing to the strength of the real estate market in Salt Lake County is the area’s low inventory of homes for sale. This has created a competitive market, with multiple offers and bidding wars becoming increasingly common. As a result, home prices have continued to rise, with the median home price in Salt Lake County currently hovering around $400,000.

 

Despite the high prices, however, there are still opportunities for buyers in Salt Lake County. New construction is on the rise, with developers building a range of homes to meet the needs of different buyers. From luxury homes in exclusive neighborhoods to more affordable starter homes, there are options for buyers at every price point.

 

For sellers, the current market conditions in Salt Lake County are favorable. With low inventory and high demand, homes are selling quickly and often for above asking price. This has created a seller’s market, with many homeowners receiving multiple offers and having the luxury of choosing the best one.

 

Looking ahead to 2023, experts predict that the real estate market in Salt Lake County will continue to be strong. While there may be some fluctuations in home prices and sales volume, the overall trend is expected to be one of growth and stability. For buyers and sellers alike, this is good news, as it means that the real estate market in Salt Lake County will remain a solid investment for years to come.

Marty Gale

Buy or Sell with Marty Gale

"Its The Experience"

Principal Broker and Owner of Utah Realty™

Licensed Since 1986

CERTIFIED LUXURY HOME MARKETING SPECIALIST (CLHM)
PSA  (Pricing Strategy Advisor)
General Contractor 2000 (in-active)
e-pro (advanced digital marketing) 2001
Certified Residential Specialist 2009
Certified Negotiation Expert 2014
Master Certified Negotiation Expert 2014
Certified Probate Specialist Since 2018
Senior Real Estate Specialist
Certified Divorce Specialist CDS

Contact me! 

 

 

Why You May Want an Energy-Efficient Home

Why You May Want an Energy-Efficient Home

Why You May Want an Energy-Efficient Home

Some Highlights

  • Since inflation is increasing the cost of goods and services, it may make sense to look for an energy-efficient home.
  • Energy prices have increased over the last year, so look for energy-efficient features in your home search.
  • If you’re looking to buy a home this year, let’s connect so you have a partner to help you consider which features are most important to you.

Marty Gale

Buy or Sell with Marty Gale

"Its The Experience"

Principal Broker and Owner of Utah Realty™

Licensed Since 1986

CERTIFIED LUXURY HOME MARKETING SPECIALIST (CLHM)
PSA  (Pricing Strategy Advisor)
General Contractor 2000 (in-active)
e-pro (advanced digital marketing) 2001
Certified Residential Specialist 2009
Certified Negotiation Expert 2014
Master Certified Negotiation Expert 2014
Certified Probate Specialist Since 2018
Senior Real Estate Specialist
Certified Divorce Specialist CDS

Contact me! 

 

 

Why Use A Senior Real Estate Specialist?

Why Use A Senior Real Estate Specialist?

Why Use A Senior Real Estate Specialist

 

As we age, our housing needs change. Whether you’re looking to downsize, move closer to family, or find a home that better suits your lifestyle, the process of selling your home can be overwhelming. That’s where a Senior Real Estate Specialist (SRES) comes in.

An SRES is a real estate agent who has received specialized training to work with seniors and their unique housing needs. They understand the emotional and financial challenges that come with selling a home later in life and can provide guidance and support throughout the process.

Here are just a few reasons why you should consider working with an SRES when selling your home:

1. They understand your unique needs: An SRES has experience working with seniors and understands the unique challenges that come with selling a home later in life. They can help you navigate the emotional and financial aspects of the process and provide guidance on your housing options.

2. They can help you downsize: Downsizing can be a daunting task, but an SRES can help you navigate the process. They can provide resources for decluttering and organizing your home, as well as help you find a new home that better suits your lifestyle.

3. They can connect you with resources: Selling a home can be a complex process, but an SRES has connections to resources that can help. They can connect you with attorneys, financial planners, and other professionals who can provide guidance and support.

4. They can help you get the best price for your home: An SRES has experience working with seniors and understands the unique challenges that come with selling a home later in life. They can help you price your home appropriately and negotiate on your behalf to get the best possible price.

If you’re considering selling your home, don’t go it alone. Working with an SRES can provide the guidance and support you need to make the process as smooth as possible. If you’re looking for an SRES in your area, please don’t hesitate to call me. I would be happy to answer any questions you may have and help you get started on the next chapter of your life.

What’s the Difference Between a Home Inspection and an Appraisal?

What’s the Difference Between a Home Inspection and an Appraisal?

What’s the Difference Between a Home Inspection and an Appraisal?

If you’re planning to buy a home, an inspection is an important step in the process. It assesses the condition of the home before you finalize the transaction. It’s also a different step in the process from an appraisal, which is a professional evaluation of the market value of the home you’d like to buy. In most cases, an appraisal is ordered by the lender to confirm or verify the value of the home prior to lending a buyer money for the purchase. Here’s the breakdown of each one and why they’re both important when buying a home.

Home Inspection

Here’s the key difference between an inspection and an appraisal. Bankrate says:

“In short, while an appraisal helps you understand a home’s value, inspections help you understand a home’s condition.”

The home inspection is a way to determine the current state, safety, and condition of the home before you finalize the sale. If anything is questionable in the inspection process – like the age of the roof, the state of the HVAC system, or just about anything else – you as a buyer have the option to discuss and negotiate any potential issues or repairs with the seller before the transaction is final. Your real estate agent is a key expert to help you through this part of the process.

Home Appraisal

The National Association of Realtors (NAR) explains:

A home purchase is typically the largest investment someone will make. Protect yourself by getting your investment appraised! An appraiser will observe the property, analyze the data, and report their findings to their client. For the typical home purchase transaction, the lender usually orders the appraisal to assist in the lender’s decision to provide funds for a mortgage.”

When you apply for a mortgage, an unbiased appraisal (which is required by the lender) is the best way to confirm the value of the home based on the sale price. Regardless of what you’re willing to pay for a house, if you’ll be using a mortgage to fund your purchase, the appraisal will help make sure the bank doesn’t loan you more than what the home is worth.

This is especially critical in today’s sellers’ market where low inventory is driving an increase in bidding wars, which can push home prices upward. When sellers are in a strong position like this, they tend to believe they can set whatever price they want for their house under the assumption that competing buyers will be willing to pay more.

However, the lender will only allow the buyer to borrow based on the value of the home. This is what helps keep home prices in check. If there’s ever any confusion or discrepancy between the appraisal and the sale price, your trusted real estate professional will help you navigate any additional negotiations in the buying process.

Bottom Line

The inspection and the appraisal are critical steps when buying a home, and you don’t need to manage them by yourself. Let’s connect today so you have the expert guidance you need to navigate the entire homebuying process.

Marty Gale

Buy or Sell with Marty Gale

"Its The Experience"

Principal Broker and Owner of Utah Realty™

Licensed Since 1986

CERTIFIED LUXURY HOME MARKETING SPECIALIST (CLHM)
PSA  (Pricing Strategy Advisor)
General Contractor 2000 (in-active)
e-pro (advanced digital marketing) 2001
Certified Residential Specialist 2009
Certified Negotiation Expert 2014
Master Certified Negotiation Expert 2014
Certified Probate Specialist Since 2018
Senior Real Estate Specialist
Certified Divorce Specialist CDS

Contact me! 

 

 

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