During the past couple of years the real estate market has been crazy!

With a record few number of sellers, buyers have faced relentless competition, multiple bid scenarios, over-asking price seller expectations and more.

If you’ve been in the market, you know what I am talking about, right?

Finally, we are starting to see more inventory come on the market and buyer competition is easing a bit. For the first time in at least two years, it feels like sellers aren’t holding ALL the cards!

– The numbers of home sales and going into contract has started to drop this month.
– More sellers are now lowering their asking prices.
– Fewer buyers are making offers on each home.

So the question is, should buyers be fearful of this market change?

Does this shift towards a more balanced market mean the market is about to crash?

Now that the market is slowing a bit should buyers wait?
Let’s think about this for a minute…

There are a few things to consider in this shifting market:
1. Does this shift foretell a market crash?
2. Where do you want to live for the next chapter of your life?
3. If you were home shopping when the rest of the world was and you were coming up frustrated, why would step to the side just when the market is moving in your favor?

1. Does this shift foretell a market crash?

Because the 2008 real estate market crash is so fresh in our memories, it is natural to think that any market shift is going to look like that one. Will it really? Does anyone know for a fact?

The 2008 crash was driven in large part by the lending market. Low-down payment, no-downpayment, and even negative-down payment loans meant that too many homeowners had no equity, or even negative equity in their homes. With no skin in the game, homeowners were able to default without risking huge losses.

Today that scenario has been flipped on its head. Homeowners have more equity in their homes than ever before! At the same time, the national delinquency rate is at a record low of 2.8%.

So, are we staring into the face of a market crash? I can’t, nor can anyone else, tell you for certain one way or another. What I can tell you, though, is that the underlying fundamentals in no way resemble the market that created the 2008 crash.

Worst case scenario, would you rather ride out a downturn in your current home, or in your next dream home?

2. Where do you want to live for the next chapter of your life?

If you have been looking for a new home, there is probably some motivation driving you.

For some of you it might be simply that your overall portfolio has grown and you can afford a bigger, better home. Now the equity market has softened and you don’t feel quite so flush. In that case, maybe it makes sense to hold off. (*Not Financial Advice* – It is generally a good idea to have your downpayment, closing costs, and moving costs in cash when you START looking for a new home. If one had done that a few months ago, they would be sitting pretty as a buyer right now!)

Most people looking for a new home have had some sort of a life change. Newly married, newly single, a growing family, kids leaving the nest, wanting room for aging parents, or a new job. If that’s the case for you, has that motivation changed? If not, why would you postpone a new purchase? The best time to buy, or sell, is always when your life and finances allow for it!

People who are buying their “forever home” or plan a longer term in their next home have less to fear if the market reverses as they can ride the wave of ups and downs.

3. If you were home shopping when the rest of the world was and you were coming up frustrated, why would you step to the side just when the market is moving in your favor?

If you do that, aren’t you one of the buyers who is now making it easier for the buyers still in the game? Wouldn’t it be better to take advantage of having others step aside so that you CAN successfully buy your next home?

When I was younger, I asked a family friend how he had amassed his significant wealth buying real estate. “It’s simple,” he said. “When everyone was selling, I was buying. When everyone was buying, I was selling.” A great piece of advice I’ve tried to follow.

So, should you REALLY be fearful of a shifting market?

Or, might it actually be creating an opportunity for buyers that we haven’t seen in years?