Friends and Clients --
The good times might be coming to an end.
Yes, the economy is currently roaring along. The stock market is at an all-time high, unemployment is near record lows, and inflation is minimal.
And yet, this might be the last party before the crash.
A recent Wall Street Journal poll of 73 economists found that the majority believe a recession is coming in 2020. Active homebuyers echo these predictions, with 70% expecting the recession to come in the next several years.
And it's not just predictions. The growth of home values has slowed or decreased nationwide over the last year, and home sales are down.
All of this might bring to mind the Great Recession of 2008, which caused catastrophic price drops in housing and a lock-up of the market.
However, I personally do not believe this will happen with the next recession for two reasons:
1. There's no housing bubble
Unlike in 2006, there's not a glut of bad mortgages driving the current market. And while home prices are at record highs, this is a reflection of the lack of supply rather than speculation.
2. The looming recession will NOT be the exception
Historically, housing prices remain relatively unaffected during a recession. And the upcoming recession, whenever it arrives, is likely to fall into this trend.
This is not because the next recession will be different from the norm. It's because the last recession was different — and uniquely bad.
So what's the conclusion?
In my opinion, when the next recession hits, attractive homes will still be attractive and will sell quickly. On the other hand, less-than-ideal homes will have a harder time selling than they do now.
In other words, we might see some corrections—but the fundamentals will remain the same.
And that's why I advise you to think of your own goals, needs, and circumstances first — and only then look at the possibility of a coming recession.
So if you have been considering selling, and you're wondering whether now is a good time, check out the following value calculator. It will give you an idea of what your home is worth in the current Austin market:
And if you're looking to buy a home, then take a look at the following complete listing of Austin homes, including a few beautiful homes that have just come on the market:
And whether you are thinking of selling or buying, give me a call with any questions at 512-829-8000. I have my finger on the pulse of the Austin real estate market, and I'm here to help you make the best decision in your particular case.
Have a great day,
Looking to buy a home? Looking to sell a home?