Whether you believe the U.S. will see inflation in the next couple of years or not, one thing is for certain- this super-hot sellers market is unprecedented. Many, including myself believe that this crazy market we're experiencing is a direct result of COVID-19's impact on the housing industry. Many sellers who would have chosen to list and sell their home over the past year have pulled back and decided not to sell. That decision has resulted in this grandiose shortage of inventory which is why buyers have to compete for the few properties that do come on the market. Simple supply and demand.
I buy gas for my car at Costco and I'm shocked at the price of gas and what's happened to it over the past four weeks or so. Food prices are on the rise and I'm sure you can name plenty of other commodities that now cost more than they did six months ago. I'm definitely not a financial analyst or even close to one, but I do think that there might be a correlation between the money that is now being printed by the government and the rise in prices that we're seeing.
If inflation is a real possibility in this country in the coming months, there's a good chance that this current hot sellers market is going to come to a screeching halt. And as we all know, real estate is all about timing. Additionally, almost a third of Americans have been vaccinated and most likely by the end of this summer, that number will rise significantly and then homeowners will begin to relax a little and decide it's now time to put their home on the market which will add to the supply.
When my clients ask me if now is a good time to sell, I talk to them about the possibility of higher interest rates on the horizon due to inflation AND about homeowners getting vaccinated and how that can affect the supply. For those two reasons, I recommend that they sell sooner rather than later. Because you just don't know when this bubble will pop. Remember 2007?