It is happening right now…
There are things in our lives that we can predict. Sometimes it is based on the past as in ‘the sun rises in the east’ and ‘it will rise tomorrow’. We are all pretty sure we can count on that. We know from school about the Law of Supply and Demand. It is called a law because it works every single time. It is like the Law of Gravity. It works every time.
Sometimes there are things we can show are likely to happen. My dad used to say ‘nothing good happens after midnight’ and he was right. While not a law it was a principle that we could apply and frankly I said it to my own boys while they were growing up. Another principle is to buy real estate and hold on to it and the value will increase. Some are questioning the validity of that statement but we are beginning to see the tangible evidence that it is true.
We have had a big adjustment the last few years and it has been painful for lots of people but frankly this adjustment was delayed and inevitable. There are signs that it just may be over.
From The Good News Economist come two articles that you need to see. Home prices are up in a dozen cities is the US is the first article and it shows real data about price increases. The second article shows us that sales numbers are increasing in and inventory is dropping. Even better news is the decline in the number of sales that are foreclosures. It dropped from 50% to about 33%. That is good news for homeowners that have to sell.
The Law of Supply and Demand apply to housing just like anything else. We are going to see some more foreclosures although maybe not as many as some would predict. I just read how the LIBOR rate (used to adjust some mortgage rates on the ARM type) is falling and many home owners are seeing their rates adjust DOWN and that saves them money every month. With the inventory decreasing and the demand increasing as buyers finally get out there as they see interest rates begin to rise; we are seeing offers become more reasonable, prices stabilize and rise again. I am even seeing some multiple offer situations happen again.
It is happening right now so check out the data for yourself and let me know how I can help. If you know anyone having trouble buying or selling in this market please call me. I can help.
Thanks for listening,
Jerry W. Robertson