Andrew Shader offers reasons for potential homebuyers to feel optimistic. Even though the market has slowed down and economists are predicting a recession, the housing market is still expected to sustain its momentum. That’s good for anyone interested in buying their next home.
To understand why you might want to wait for shifts in the market, you need to look at how the economy will affect real estate in the coming months.
How the Pandemic Affected Real Estate
Almost as soon as the COVID-19 pandemic started, homebuyers discovered that there were only so many homes on the market. Several factors contributed to this low inventory.
Primarily, lockdowns and initial reactions to the pandemic brought almost every industry to a grinding halt. This situation created labor shortages and supply chain issues that affected the construction industry. It took longer to complete new construction homes, so fewer new homes were entering the market.
This increased the demand for the available existing resale homes. As a result, real estate prices steadily rose, and buyers found that there was considerably more competition for the few homes on the market.
The Real Estate Market Is Rebounding Slowly
After months of society returning to a more normal routine, things have improved gradually. While there are still labor shortages and supply chain issues, those problems are gradually working themselves out. Construction companies are finding it easier to get the supplies they need to finish new construction projects.
The onset of inflation has also played a part in complicating things for homebuyers. Prices have continued to rise, and many economists expect a recession. Current economic trends have forced more people to either return to the job market or make career changes. As a result, labor shortages are becoming less problematic.
When it comes to buying a home, these issues can have a positive impact. The unique economic situation has helped to increase the number of new and resale homes on the market.
As home inventory increases, demand won’t be as severe, and prices will drop. Homebuyers will find it easier to get into new homes as the real estate market makes this additional shift.
The Future is Promising for Homebuyers
In recent years, fluctuations in the real estate market posed a challenge for anyone interested in buying a new home. As prices rose, many homebuyers found it difficult to find properties that suited their needs. Some were priced out of the market entirely.
Fortunately, there has been a gradual shift in the opposite direction. As more homes enter the market, real estate prices will drop or even out. This is especially true in areas where home prices have recently become overinflated. Lower home prices will give the average person more buying power.
Whether you’re investing in real estate or buying your first home, paying less for your home will help you get more out of your purchase. You’ll build equity faster and pay off your mortgage sooner.
Guidance from Andrew Shader
Andrew Shader is a real estate investor and entrepreneur with an education in business management and marketing. His passion for buying real estate and upgrading properties to turn a profit has given him long-term insight into how the market fluctuates. When he’s not investing in Fort Lauderdale real estate, Mr. Shader enjoys reading and watching sports.