Keep Calm - The Sky is Not Falling! This Is NOT 2008

By
Real Estate Agent with www.iCharlotteHomes.com | The Maxwell House Group | RE/MAX Executive | (704) 491-3310 228209
https://activerain.com/droplet/5kFR

Keep Calm - The Sky is Not Falling! This Is NOT 2008

 

Recessions are a fact of life - as we often hear financial advisors say, “It’s not a matter of if but, when we’ll experience another one.” We don’t know - none of us have crystal balls and if you are a business owner as I am, you read, analyze data and come up with your own opinion. And, that’s just we all have about a possible correction/recession - our own OPINION!

 

the sky is not falling in real estate

 

We have heard from many in the news media that ‘this is the year’ or that ‘a recession is upon us.’ Really, their data is no better than ours - they’re stating conjectures - well, and we all know how they love sensationalism! That’s what sells in their business so, they stick with what ‘sells’ in their business. I call it ‘Chicken Little Syndrome!’ Sometimes, it’s at the expense of others’ businesses; in this case, their invalid conjectures are causing some who are/were thinking of buying or selling to hedge their bets a bit.

 

Don't be a chicken little when it comes to Charlotte real estate

 

So, here are a few facts and the conclusion that those of us in the real estate business would like to share:

 

Last week realtor.com released the results of a survey that produced three major revelations:

 

1. 53% of home purchasers (first-time and repeat buyers) currently in the market believe a recession will occur this year or next.

2. 57% believe the next recession will be as bad or worse than 2008.

3. 55% said they would cancel plans to move if a recession occurred.

 

Opinions varySince we are currently experiencing the longest-ever economic expansion in American history, conjecture about a possible recession does seem like a ‘logical’ progression. Sadly, there is no ‘merit’ to these claims and all it does is remind buyers and sellers of the horrors of 2008 when they hear the word “recession.” It does tend to stop a LOT of people in their tracks - especially if you were a homeowner during the 2008 recession or were impacted by it in any way, shape or form.

 

Ali Wolf, Director of Economic Research at the real estate consulting firm Meyers Research, said it well, With people having PTSD from the last time, they’re still afraid of buying at the wrong time.

 

Most experts, however, believe that, even if there is a recession, it will not resemble 2008. This housing market is in no way the same as it was just over a decade ago. Economist, Jeff Tucker, explained recently:

 

“As we look ahead to the next recession, it’s important to recognize how unusual the conditions were that caused the last one, and what’s different about the housing market today. Rather than abundant homes, we have a shortage of new home supply. Rather than risky borrowers taking on adjustable-rate mortgages, we have buyers with sterling credit scores taking out predictable 30-year fixed-rate mortgages. The housing market is simply much less risky than it was 15 years ago.”

 


 

 

Here’s a little tidbit that I firmly believe hits my point home:


bears and bullsIn the past 23 years, there have been two national recessions – the dot-com crash in 2001 and The Great Recession in 2008. Home values fell 19.7% during the 2008 recession, which happened to be caused by a mortgage meltdown. However, during the dot-com crash/recession in 2001, stock prices did fall almost 25% but, home values appreciated 6.6%. The triggers of the next correction/recession will more closely mirror those from 2001 – not those from 2008. As you know, lending criteria is far more stringent than prior to The Great Recession of 2008.

 


 

the bottom line in real estate

No one can accurately predict when the next correction/recession will occur so, are you going to live your life fearing one? It is very important to realize that the impact of a recession on the housing market, regardless of when it occurs, will in no way resemble 2008.

 

 Read related post: Keep Calm and Don’t Be a Chicken Little

 

 

Take if from the real estate professionals, the media has a political agenda with every story! Before you heed any recessionary warnings, dive into the facts - both locally AND from the professionals with boots on the ground in real estate! Call or text me at (704) 491-3310 today.

 

#NoRecessionHere   #CharlotteHousingMarketStrong   #ThisIsNot2008

 

© Debe Maxwell | The Maxwell House Group | RE/MAX Executive | CharlotteBroker@icloud.com | Keep Calm - The Sky is Not Falling! This Is NOT 2008

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Re-Blogged 2 times:

Re-Blogged By Re-Blogged At
  1. Ginger Harper 09/08/2019 07:20 PM
  2. Brenda Mayette 09/09/2019 04:44 AM
Topic:
Real Estate Industry
Location:
North Carolina Mecklenburg County Charlotte
Groups:
North Carolina Real Estate
Market Updates
Charlotte North Carolina Area
Hyper-Local
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Tags:
chicken little mentality
on recessions in real estate
no recession here

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Ambassador
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Debe Maxwell, CRS
www.iCharlotteHomes.com | The Maxwell House Group | RE/MAX Executive | (704) 491-3310 - Charlotte, NC
Charlotte Homes for Sale - Charlotte Neighborhoods

I'm so glad you agree, Diana Dahlberg but, there wasn't really a question in my mind as to whether we would agree on this topic! 😉 Hope you have a great week!

Sep 09, 2019 10:07 PM #73
Rainmaker
449,221
Scott Seaton Jr. Bourbonnais Kankakee IL Home Inspector
SLS Home Inspections-Bradley Bourbonnais Kankakee Manteno - Bourbonnais, IL
The Home Inspector With a Heart!

Well said and right on point. I'm actually hiring a marketing rep to grow our business in the event anything happens, so we'll be on the attack, not sitting by. If nothing happens, watch out, we will be on fire. 

Sep 10, 2019 04:27 AM #74
Rainmaker
686,484
James Quarello
JRV Home Inspection Services, LLC - Wallingford, CT
Connecticut Home Inspector

Um, sorry, but the data otherwise known as facts, points to a recesion. Not like 2008? Might be just as bad, possibly worse or, fingers crossed, not as bad. When one looks at the over all economic picture and the curent policies, it's not  looking promising. 

Sep 10, 2019 06:05 AM #75
Rainmaker
1,051,946
Steve Loynd
Alpine Lakes Real Estate Inc., - Lincoln, NH
800-926-5653, White Mountains NH

I think the talking heads can try to make a penguin in to a duck, and we all suffer from analysis paralysis to some extend.  I'll keep doing what I'm doing, and if being busy as hell is a sign of trouble I'll keep at it.

Sep 10, 2019 06:28 AM #76
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Debb Janes EcoBroker and Bernie Stea JD
ViewHomes of Clark County - Nature As Neighbors - Camas, WA
REALTORS® in Clark County, WA

Hi there Debe, what a well constructed post. And as you tell Alan May, you are sensible, logical, responsible and practical - and objective!  D 

Sep 10, 2019 06:51 AM #77
Rainmaker
299,425
Marti Steele Kilby, CRS
Steele Group Realty - La Mesa, CA
Broker/Owner, San Diego, CA

Great post Debe,!I agree that any upcoming recession will not be as disastorous as 2008, but I do believe that it will happen and have a real impact on the real estate market.  It will likely be different  depending on where one lives, but we are already starting to see buyers becoming a bit more hesitant to make a purchase decision here in San Diego.  Here is my take on the local situation.

Sep 10, 2019 07:41 AM #78
Anonymous
Rose OReillyHomeSmartSD

Thank you for the great stats Debbe: The news media thinks they know it all. It's more political than facts. With the stock market at an all time high and employment at an all time low, it doesn't make sense.

Sep 10, 2019 11:24 AM #79
Anonymous
Julie O

I agree with your article completely however we are starting to see the risky loans again so give it a few years....

Sep 10, 2019 11:29 AM #80
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Debe Maxwell, CRS
www.iCharlotteHomes.com | The Maxwell House Group | RE/MAX Executive | (704) 491-3310 - Charlotte, NC
Charlotte Homes for Sale - Charlotte Neighborhoods

Smart move, Scott Seaton Jr. Bourbonnais Kankakee IL Home Inspector! I built my business exponentially during the recession. Love your mindset!

Sep 10, 2019 07:05 PM #81
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Debe Maxwell, CRS
www.iCharlotteHomes.com | The Maxwell House Group | RE/MAX Executive | (704) 491-3310 - Charlotte, NC
Charlotte Homes for Sale - Charlotte Neighborhoods

James Quarello, I'm not sure what 'facts' you are referring to but, we are in an area that is bringing 120 new people to our beautiful city every single day of the week! Our jobless rate is lower than it has been in FIFTY years, our mortgage interest rates are at historic lows and our current housing inventory is at a 2.3 MONTH SUPPLY. Those facts point nowhere other than an incredibly healthy economy - at least in my area. 

The stock market IS due a correction but, with that we see fluctuations (as we have experienced for several months) and we could possibly see even more losses in the stock market. Then again, I don't have a crystal ball but, I do have real estate & local economic data at my fingertips so, I can confidently share those as well as my analysis as stated above.

Sep 10, 2019 07:15 PM #82
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Debe Maxwell, CRS
www.iCharlotteHomes.com | The Maxwell House Group | RE/MAX Executive | (704) 491-3310 - Charlotte, NC
Charlotte Homes for Sale - Charlotte Neighborhoods

Love your last line, Steve Loynd - I'm rather enjoying this 'trouble' we're in!

Sep 10, 2019 07:16 PM #83
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Debe Maxwell, CRS
www.iCharlotteHomes.com | The Maxwell House Group | RE/MAX Executive | (704) 491-3310 - Charlotte, NC
Charlotte Homes for Sale - Charlotte Neighborhoods

Hi Debb Janes EcoBroker and Bernie Stea JD! Thank you! 

Funny, I was looking for that link to share and as I remembered & sang every word to the song, I saw the date of 1979 - BOY, did I feel old! 🤣 

Sep 10, 2019 07:18 PM #84
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Debe Maxwell, CRS
www.iCharlotteHomes.com | The Maxwell House Group | RE/MAX Executive | (704) 491-3310 - Charlotte, NC
Charlotte Homes for Sale - Charlotte Neighborhoods

I am hopeful that the economists are right - this is only a correction, Marti Steele Kilby, CRS. If not, our lending has been so strict since the previous recession, I don't feel we'll be hit in our business - at least NOTHING like we were 2008 to 2012! 

Great post, BTW! ;-) 

Sep 10, 2019 07:26 PM #85
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Debe Maxwell, CRS
www.iCharlotteHomes.com | The Maxwell House Group | RE/MAX Executive | (704) 491-3310 - Charlotte, NC
Charlotte Homes for Sale - Charlotte Neighborhoods

You're so right, @Rose OReillyHomeSmartSD

Sep 10, 2019 07:27 PM #86
Ambassador
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Debe Maxwell, CRS
www.iCharlotteHomes.com | The Maxwell House Group | RE/MAX Executive | (704) 491-3310 - Charlotte, NC
Charlotte Homes for Sale - Charlotte Neighborhoods

Thankfully I'm in an area that is not seeing risky loans at all - we are still battling low appraisals in some instances! It goes to show, real estate is HYPER- local, Julie O!

Sep 10, 2019 07:28 PM #87
Rainmaker
6,424
Krystin Mitchell, CPA CFE
KLSM CPA Firm, PLLC - Houston, TX
Accounting, Tax Preparation & Resolution, Tax Lien

Very informative, thanks for putting this together. 

 

Sep 10, 2019 08:56 PM #88
Rainmaker
4,770
Beachworks LLC
Beachworks LLC - Seattle, WA
Buying and Selling Houses in Seattle

Nice post. About to post a similar article for our blog. This is giving me ideas too. 

Sep 11, 2019 02:08 PM #89
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Debe Maxwell, CRS
www.iCharlotteHomes.com | The Maxwell House Group | RE/MAX Executive | (704) 491-3310 - Charlotte, NC
Charlotte Homes for Sale - Charlotte Neighborhoods

Not to be a contrarian, James Quarello but, I recently heard the media touting the 'historically high' debt levels this year and actually discussed this at Closing with a lender. He explained to me that yes, nationally, the average debt is higher and we HOPE that it continues to grow. Why?

Credit restrictions are more stringent now than they've ever been in the past and income is at historical highs as well. Lenders are requiring LOWER DTIRs for buyers to buy and with the higher income levels, the debt to income is actually considerably LOWER than the historical norms. See the data below.

DTIR

Sep 11, 2019 10:40 PM #90
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Debe Maxwell, CRS
www.iCharlotteHomes.com | The Maxwell House Group | RE/MAX Executive | (704) 491-3310 - Charlotte, NC
Charlotte Homes for Sale - Charlotte Neighborhoods

Thank you, Krystin Mitchell, CPA CFE! For those of us in the business, it's nice to be able to share our knowledge with the consumer - instead of shooting ourselves in the foot by agreeing with the talking heads who truly don't know what they're reporting! 😉 

Sep 11, 2019 10:42 PM #91
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Debe Maxwell, CRS
www.iCharlotteHomes.com | The Maxwell House Group | RE/MAX Executive | (704) 491-3310 - Charlotte, NC
Charlotte Homes for Sale - Charlotte Neighborhoods

Well, thank you Beachworks LLC! I hope it helps you prepare your data for your consumer. 

Sep 11, 2019 10:44 PM #92
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