I’ve heard stories in the Portland, OR area of houses going for 100K+ over listing. All that to live with bad traffic, terrible leadership and homeless camps on your sidewalk (all related to why I’m now living in Maui, btw). I have to think some of these listing agents set the price low on purpose and wait the bidding war to see what they can get.
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Yep. I concur.
Buyers market on the horizon. Should be plenty of home to inspect within the next year.
Lots of work for everyone on the way 
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I hope you’re right but does a buyer’s market equate directly to lots of inspections? In my experience, no. 2009-2012 was a strong buyers market but I spent a lot of days golfing. It could be a strong buyer’s market but if said buyers can’t afford a loan and sellers won’t get realistic about the price of their house it’s just going to turn into a standoff. Sellers are notoriously stubborn and never want to admit their house has stopped appreciating 20%/year. Let alone maybe even gone down some in value.
Volume of sales seems be most closely tied to buyers’ ability to afford the mortgage (kind of sad everyone is so strung out financially). This year my company’s volume has gone up/down like a yo-yo depending on rates. When they spiked up near 7% in April we were super slow. When they come back down we get busy. Looking into my crystal ball I think rates will be the largest determination as to all of us staying busy for the foreseeable future. Prices gradually tapering off would be nice rather than a crash of some type.
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agreed. Bankruptcies or loan defaults is something to monitor. Of course, inflation has not yet been fully realized much less the inevitable recession, therefore the potential damage has yet to be seen. I’ll take steady slow over a crash any day.
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I don’t foresee a “crash” but a market that’s going to correct itself. What I saw in my area the past two years was a “pandemic” scare. Many of my clients were leaving urban/suburban areas because they were in a position that they could work remotely or they wanted a less “restrictive” safe retreat. That has really slowed down. The inventory is probably a quarter of what it was the past two years.
As far as foreclosures, it won’t be like it was in the late 2000’s. The vast majority of that was caused by 0 down and 110%+ financing. At least the banks got more strict, but inflation may take it’s toll on some of the recent buyers. As you say, slow but no crash hopefully.
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I feel like the biggest risk now is that many borrowers stretched themselves to the absolute max in order to win a home. Any hiccup in their income or large unforeseen expense could topple the house of cards. Considering most also bought to the max without a home inspection, the likelihood of large unforeseen expenses increases.
Now throw into the mix actions being taken by the Fed to slow the out of control inflation. This is almost impossible to do without creating a recession. Pulling it off is called a “Soft Landing” and some say it has been achieved three times in the past, in 1965, 1984, and 1994. The economic conditions this time though are quite a bit different than in those situations. It’s almost unanimous among those who study this type of thing that we will not avoid a recession this time.
So if a recession is inevitable, that means borrowers could be faced with economic challenges, just after they maxed out their borrowing power trying to win a new home. If they are forced to sell, they may find that prices have fallen (due to recession) to the point they are underwater.
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Two things worked in my area; 1. Very few first time homeowners period. 2. It was probably more than 40 to 60% cash sales here. People were investing in RE as oppose to the Market. Can’t and don’t blame them for being smart.
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I don’t see a quick turnaround anytime soon, although I still hope it happens. Rising rates will help slow it down some.
# America is short more than 5 million homes, and builders can’t make up the difference
Here in SW Ohio the average house is on the market for a whopping 2 days, that’s from the latest numbers released which was for March. We’re still having bidding wars here, as I’m sure most everywhere else is as well.
Had a guy tell me a couple days ago when he was buying his first home back in the 70s interest rates were 17%.
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I used to own a Title company and researched titles for closings. The 70’s had the highest rates I have ever seen at 16 to 17%. I’m still holding onto a 7% that I took out in 2006. Various reasons I didn’t refi but what the hey…
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1984 is interesting… I have to think there was an official recession in the early 80s and they avoided the one in 1984 as things were bouncing along the bottom. I remember talking to some of my very experienced agents during the 2010 crash about the early 80s crash and they all said the one in the 80s was worse. It just went on and on and one. It’s always interesting to me how few houses there are in my area that were built in the early 80s. My company does somewhere around 1200 inspections a year and often times I can count on one hand the number in 1982 and 1983. I would have been 10 years old in 1982 and can definitely remember hearing a lot of talk about things being bad but, of course, as a kid it didn’t really matter… Hell, we got cable TV. My whole life changed!
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I was told rates are as high as 7% today even for good buyers (20% down, high credit score, etc.). Volume-wise were still doing okay but in the past these spikes have taken out a chunk of business. Anxiously waiting and watching!
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Down here we’re all swamped with Wind Mitigation & 4 Point calls to fill the voids.
68,000 homeowners got their homeowners insurance early cancelled & need new reports to find another carrier… … I’m one on them. 
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What’s happening in your neck of the woods? Our inventory in the Portland area has just doubled and with the rising interest rates I suspect it’s going to keep going. Definitely a better balance with houses not being so scarce but buyers’ purchasing power is getting slashed pretty hard.
Yeah, my retirement accounts have only lost about 20% this year and my cash under the mattress has lost nearly 9%.
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Anyone that thinks its slow now I hate to tell you it’s about to get worse. The inflation report today was terrible and virtually guarantees another 75 point rate hike in November.
The fed really screwed us all by keeping the rates so low for so long. And this crosses several presidential administrations so as much I want blame our current administration, the blame can be spread around to at least the previous two. I had to laugh when I recently saw an article about a previous fed chairman being nominated for a Noble prize for his great work. Yeah, nice job! Anyone with anything to do with US monetary policy and spending over the last 30 years should be flogged at the town square.
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I partially disagree, we had marginal and expected inflation during the period of low rates.
The problem we have now is that inflation is not solely tied to interest rates. We printed too much money and supply chains were disrupted. Remove cash from circulation is only going to do so much. Basically, my point is they could raise rates to 20 tomorrow and it likely would not stall inflation. For example, raising rates will not reduce the cost of fuel.
The other issue, which I think you are pointing to is that high rates are driving away buyers and sellers. Not only is an emotional correction needed, home prices must drop to match affordability.
Then comes the 3rd wave of high interest rate collateral damage, job loss. They expect 175,000 jobs lost per month beginning 2023. Yuck.
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Yep, totally agree… that’s what I was referring to with my last sentence and the flogging in the town square. It’s just ridiculous the corner we’ve painted ourselves into. I just can’t believe these so-called experts can be so irresponsible and make such poor decisions.
And you’re spot on about house prices although remembering back to the last crisis, sellers are a stubborn bunch to say the least.
I’m glad I know how to bartend and live in a tourist destination. I’m envisioning mixing a few Mai Tais in the near future!
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I can’t say that is all bad!! 
I can think of worse things than bartending in Hawaii while running a multi-inspector firm elsewhere. Hang-five!
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When there are no consequences for bad work, the work keeps getting worse.
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