Our local real estate market presses onward and upward! Yes, there is some “buyer fatigue” and talk of price softening. The data however reads that the shortage of inventory is still driving this price increase train, and will likely continue to do so as interest rates remain relatively low.
Are we possibly in a price bubble and staged to see a correction? For every reason we think it likely, we also have a counter theory which signals to full-steam ahead. Who knows!
Here is our suggestion… Plan for a downturn within the next ten years. If you own your home, we caution against tapping into your current equity unless it is to upgrade your property. Go ahead and buy that new home or investment property, but avoid being highly leveraged! Pay a little extra every month on your loan(s) if you can. (We should add, whenever you are considering significant money moves, be sure to consult with your financial advisor, tax consultant, etc.)
We remember when the real estate market plunged around 2008. We heard over and over from homeowners who had been watching their home worth grow, “I lost so much money!” In reality, they never had it. We have to remember, what our homes are estimated to be today is only a point of interest. The true value of a property is realized the day we go to sell.