Author Topic: Real Estate Forecast for Next Few Years (2024 - ?)  (Read 5229 times)

kenmoremmm

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Real Estate Forecast for Next Few Years (2024 - ?)
« on: August 29, 2024, 12:33:11 AM »
I haven't been in the financial world loop lately (long story), but I believe that I heard/read that the US Fed and others around the world are planning for rate cuts later this year. It also seems like many western economies are teetering on possible recessions or slowdowns, which suggests more rate cuts.

I know that many people are locked into good mortgage rates now, so the number of people selling is low and that's helping keep home prices somewhat steady despite higher mortgage rates and dramatically reduced purchasing power.

I'm curious what people around here that are paying attention and have experience think about the situation and where home prices will go in the next few years. To me, it somewhat feels like the Great Recession, without the full recession trigger (unless China or something crazy happens). Seems like house prices might dip a bit (5-10%) but then as the rates are lowered and mortgage rates fall back into the 4's and 5's, house prices will rocket up due to the relative affordability and pent up demand.

I have a few rentals that are so-so performers, but there aren't many good options for me where I live. I've debated selling one of them, but question if in 3 years the price will be 30-40% higher just because.

Paper Chaser

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Re: Real Estate Forecast for Next Few Years (2024 - ?)
« Reply #1 on: August 29, 2024, 04:08:49 AM »
It's anybody's guess. Prices are so location specific that it's about impossible to accurately predict values.

I like following Lance Lambert for housing data (@newslambert). He seems to have the least biased presentation that I've seen for nationwide trends, forecasts from various RE stakeholders and data even down to the zipcode level.

Personally, I think we'll see values slide a bit in the next couple of years in most places. Some locations have already cooled a ton (Austin, Florida, etc). Inventory is beginning to climb as buyers hold off. Home builders are still adding to inventory and offering incentives that were a pipe dream 4 years ago. If we do see widespread job loss, then home values could drop more.

GilesMM

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Re: Real Estate Forecast for Next Few Years (2024 - ?)
« Reply #2 on: August 29, 2024, 06:25:09 AM »
Real estate is mostly local.  The market may dip or crash in one area while soaring in another.    Austin is down this year but San Jose is surging.


Nationally, I think you summed it up well - prices could soar on rate cuts, crash with a recession, or stay about the same.

SilentC

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Re: Real Estate Forecast for Next Few Years (2024 - ?)
« Reply #3 on: September 01, 2024, 08:23:10 PM »
It’s super local, until it isn’t (if enough local shifts cause a national issue).  Right now our suburb seems to have transitioned from FOMO to “FOOP” (fear of overpaying) over the last nine months, with two or three houses getting listed for each one that gets bought for usually under ask, but other parts of Denver metro seem in better shape.  The Redfin CEO did say recently it’s like the “Twilight Zone” where a significant decline in mortgage rates hasn’t stimulated demand so maybe it’s becoming more national, one can hope.

SeattleCPA

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Re: Real Estate Forecast for Next Few Years (2024 - ?)
« Reply #4 on: September 03, 2024, 07:26:22 AM »
I think we're in same general area. And in some categories like commercial real estate, I think values will continue to deflate. In Redmond, WA for example, I think the class A vacancy rate is 60%? And I think the lease rate that "clears" the inventory of space is probably 30% less than landlords quote right now?

But the other thing I'd think is, where do you reinvest? CAPE 10 on S&P 500 on Friday was 36.4. So a good long-term forecast of S&P is 1/36.4. That's basically a real return of 2.75%


kenmoremmm

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Re: Real Estate Forecast for Next Few Years (2024 - ?)
« Reply #5 on: September 06, 2024, 01:28:48 AM »
It’s super local, until it isn’t (if enough local shifts cause a national issue). 

Yes, this is what I was getting at with my original post.

During the great recession, house prices collapsed everywhere.

Then, as the recovery got underway, everywhere went up considerably. Some faster than others, but the general trendline was there.

Same is true during covid and trends there.

So now, I feel like we are all soon facing possible recession vibes along with falling interest rates. And then, after a brief (hopefully) contraction period, rates will be low and the economy will be on the upswing again. So then, the question is: are current prices sticky enough that as we hit the next upswing, the current price is the starting point, or will we see another Great Recession type contraction in prices.

Of course no one knows the answer, but I'm curious for opinions.

SilentC

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Re: Real Estate Forecast for Next Few Years (2024 - ?)
« Reply #6 on: September 06, 2024, 06:02:34 AM »
It’s super local, until it isn’t (if enough local shifts cause a national issue). 

Yes, this is what I was getting at with my original post.

During the great recession, house prices collapsed everywhere.

Then, as the recovery got underway, everywhere went up considerably. Some faster than others, but the general trendline was there.

Same is true during covid and trends there.

So now, I feel like we are all soon facing possible recession vibes along with falling interest rates. And then, after a brief (hopefully) contraction period, rates will be low and the economy will be on the upswing again. So then, the question is: are current prices sticky enough that as we hit the next upswing, the current price is the starting point, or will we see another Great Recession type contraction in prices.

Of course no one knows the answer, but I'm curious for opinions.

Prices will at least fall to 2021 levels over 1-2 years and rates won’t fall that much more, if I had to guess.  This answer will make the fewest people happy as affordability still isn’t great, owners lose money on paper and investors can’t resume BRRR on existing properties.
« Last Edit: September 06, 2024, 06:06:57 AM by SilentC »

GilesMM

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Re: Real Estate Forecast for Next Few Years (2024 - ?)
« Reply #7 on: September 06, 2024, 08:18:06 AM »
It’s super local, until it isn’t (if enough local shifts cause a national issue). 

Yes, this is what I was getting at with my original post.

During the great recession, house prices collapsed everywhere.

Then, as the recovery got underway, everywhere went up considerably. Some faster than others, but the general trendline was there.

Same is true during covid and trends there.

So now, I feel like we are all soon facing possible recession vibes along with falling interest rates. And then, after a brief (hopefully) contraction period, rates will be low and the economy will be on the upswing again. So then, the question is: are current prices sticky enough that as we hit the next upswing, the current price is the starting point, or will we see another Great Recession type contraction in prices.

Of course no one knows the answer, but I'm curious for opinions.


It is still pretty local. Prices in Austin have already fallen more in the last year than they did in the 2008 recession.  Ft Lauderdale prices, despite all the storm and insurance scares, are surging.

clarkfan1979

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Re: Real Estate Forecast for Next Few Years (2024 - ?)
« Reply #8 on: September 06, 2024, 08:45:17 AM »
It’s super local, until it isn’t (if enough local shifts cause a national issue). 

Yes, this is what I was getting at with my original post.

During the great recession, house prices collapsed everywhere.

Then, as the recovery got underway, everywhere went up considerably. Some faster than others, but the general trendline was there.

Same is true during covid and trends there.

So now, I feel like we are all soon facing possible recession vibes along with falling interest rates. And then, after a brief (hopefully) contraction period, rates will be low and the economy will be on the upswing again. So then, the question is: are current prices sticky enough that as we hit the next upswing, the current price is the starting point, or will we see another Great Recession type contraction in prices.

Of course no one knows the answer, but I'm curious for opinions.

Prices will at least fall to 2021 levels over 1-2 years and rates won’t fall that much more, if I had to guess.  This answer will make the fewest people happy as affordability still isn’t great, owners lose money on paper and investors can’t resume BRRR on existing properties.

I agree with the comments that real estate prices are super local, so it depends. I can offer some of my personal examples. 

One comment was that prices dropped everywhere in the 2008 crash. While the 2008 housing crash was the biggest crash of our generation, prices didn't crash everywhere. I bought a house in Fort Collins, CO in May 2007. Prices were flat from 2007 to 2010 (no crash) and then small increases 2010 to 2014 and then large increases from 2014 to 2024. I bought for 182K and now it's worth 525K.

I bought a house in Fort Myers, FL in January 2012 for 95K. In May 2007, the house was worth 250K.

Nationally speaking May 2007 was a bad time to buy. If you bought in Fort Myers, Florida in May 2007, it was really bad. However, my buy in Fort Collins, CO wasn't bad at all. The real estate market was slow and I got access to a property with a good location, which is why it appreciated from 182K to 525K over the past 17 years.

I don't see prices going back to 2021 levels for my properties. Based on my calculations that would be a decrease of 13.7% to go back to 2021 levels. However, anything is possible in other areas in which I am unfamiliar.

City                            2021 price (August)               2024 price (August)

Fort Collins, CO:           450K                                   525K
Fort Myers, FL              325K                                   375K
Koloa, HI                     1100K                                 1250K
Pueblo West, CO           325K                                  400K

Total                            2200K                                2550K

Archipelago

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Re: Real Estate Forecast for Next Few Years (2024 - ?)
« Reply #9 on: September 06, 2024, 09:05:08 AM »
At least around here in NH, houses are sitting on the market and experiencing price cuts. The market is definitely softening.

The last 3 years where all that money was flowing? Not flowing so much anymore.

I'm going to look at a house this weekend that's priced at $710k and if it's the right house for us, would make an offer for $180k under asking. Yes, I'm cool with doing that. There's another comparable house for sale priced at $585k and has been sitting on the market for over 60 days (including through the summer months which is the most popular time to buy).

I have a strong hunch there will be no other offers, the open house will be sparsely attended, and the house would not appraise anywhere near $710k. This feedback only helps the listing agent and seller.

twinstudy

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Re: Real Estate Forecast for Next Few Years (2024 - ?)
« Reply #10 on: September 08, 2024, 12:18:11 AM »
Investing is a long game and I think the smart money would be to buy up family homes in temperate areas (don't want to be flooded/bushfired) and use them as rentals, and as you or your heirs get more capital, keep buying up. Diversify to avoid concentrated land tax and just rent seek.

FINate

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Re: Real Estate Forecast for Next Few Years (2024 - ?)
« Reply #11 on: September 08, 2024, 10:04:25 AM »
Other than general frothiness in the housing market, there are very few similarities to the Great Recession. NINJA, 0 down, and liar-loans aren't really a problem, and there isn't a broad trend of people cash-out refi'ing to fund lifestyle.

I live in Boise, one of the Zoomtowns that experienced rapid appreciation during the pandemic. There's been a lot of hand-wringing about a pending crash for the past several years, but that hasn't really happened. We declined a bit from the peak of 2022Q2, but the trend is now flat with seasonal fluctuations.

It's not just that people are locked into sub-3% loans, though this is part of it. Those that bought near the peak are engaged in loss avoidance (sunk cost fallacy) -- they do not want to "lock-in" losses by selling, which would mean losing a big chunk of their down payment. People have real skin in the game with 20% down, which makes it difficult to short-sell or walk away.

Millennials are a large cohort that is now entering the prime home buying years, and there's an ongoing persistent housing shortage in much of the US. Broad based inflation in materials and labor is adding to the difficulty and cost of producing more housing.

Counterbalancing this, the long-term demographic outlook for the US is negative, which should eventually reduce demand for housing.

Instead of trying to predict the future, I've found Scenario Planning really useful in these situations. The idea is to write out a number of possible future outcomes and your personal pros and cons of each. It's just a way to help structure your thoughts and think through various implications. I did this before we moved from CA to ID and found it very helpful as we basically came to the conclusion that we really didn't like 3/4 potential outcomes, and the one outcome that was acceptable was very unlikely and even if it happened it would take too long to be meaningful to us.

For this specific question you could do something like a 2x2 along high vs. low interest rates and high vs. low housing supply. We are currently in high interest rates and low supply. Then consider low supply and low rates -- yes, this would likely trigger higher housing prices, but lowering rates may also make equities more desirable as bonds become less attractive and people chase higher returns. High supply and high rates would suggest stronger downward pressure on RE prices, whereas high supply and low rates would be somewhat similar to the current situation, but could put upward pressure on equities. Fill in as many details as possible, think through the implications,  then consider how you feel about these potential outcomes. You may decide it's not worth holding on to a rental if even if you miss out on some near term gains. Or you may decide RE investment is worth the risk for you even if it doesn't perform as well as other assets.

Archipelago

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Re: Real Estate Forecast for Next Few Years (2024 - ?)
« Reply #12 on: September 08, 2024, 12:04:15 PM »
At least around here in NH, houses are sitting on the market and experiencing price cuts. The market is definitely softening.

The last 3 years where all that money was flowing? Not flowing so much anymore.

I'm going to look at a house this weekend that's priced at $710k and if it's the right house for us, would make an offer for $180k under asking. Yes, I'm cool with doing that. There's another comparable house for sale priced at $585k and has been sitting on the market for over 60 days (including through the summer months which is the most popular time to buy).

I have a strong hunch there will be no other offers, the open house will be sparsely attended, and the house would not appraise anywhere near $710k. This feedback only helps the listing agent and seller.

As an update, I went to that open house this weekend. I was 100% right. Crickets. I was the only one there. It was me, the realtor and the loan officer. Lol.

I offered $150k under asking which was understandably shot down. The seller has only one other offer which is contingent on the buyers selling their house first. And THAT buyer is contingent on selling their house. So it's a great big ladder where the deal can't get done unless everyone sells their homes. So here we are and all 3 houses have all been sitting on the market with no buyers.

Making my personal contribution to lower the housing market! Lol
« Last Edit: September 08, 2024, 12:07:26 PM by Archipelago »

Sibley

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Re: Real Estate Forecast for Next Few Years (2024 - ?)
« Reply #13 on: September 08, 2024, 01:06:21 PM »
At least around here in NH, houses are sitting on the market and experiencing price cuts. The market is definitely softening.

The last 3 years where all that money was flowing? Not flowing so much anymore.

I'm going to look at a house this weekend that's priced at $710k and if it's the right house for us, would make an offer for $180k under asking. Yes, I'm cool with doing that. There's another comparable house for sale priced at $585k and has been sitting on the market for over 60 days (including through the summer months which is the most popular time to buy).

I have a strong hunch there will be no other offers, the open house will be sparsely attended, and the house would not appraise anywhere near $710k. This feedback only helps the listing agent and seller.

As an update, I went to that open house this weekend. I was 100% right. Crickets. I was the only one there. It was me, the realtor and the loan officer. Lol.

I offered $150k under asking which was understandably shot down. The seller has only one other offer which is contingent on the buyers selling their house first. And THAT buyer is contingent on selling their house. So it's a great big ladder where the deal can't get done unless everyone sells their homes. So here we are and all 3 houses have all been sitting on the market with no buyers.

Making my personal contribution to lower the housing market! Lol

Wait a month, then make the offer again. A bit of reality might help.

CountToFI

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Re: Real Estate Forecast for Next Few Years (2024 - ?)
« Reply #14 on: September 08, 2024, 05:08:43 PM »
At least around here in NH, houses are sitting on the market and experiencing price cuts. The market is definitely softening.

The last 3 years where all that money was flowing? Not flowing so much anymore.

I'm going to look at a house this weekend that's priced at $710k and if it's the right house for us, would make an offer for $180k under asking. Yes, I'm cool with doing that. There's another comparable house for sale priced at $585k and has been sitting on the market for over 60 days (including through the summer months which is the most popular time to buy).

I have a strong hunch there will be no other offers, the open house will be sparsely attended, and the house would not appraise anywhere near $710k. This feedback only helps the listing agent and seller.

As an update, I went to that open house this weekend. I was 100% right. Crickets. I was the only one there. It was me, the realtor and the loan officer. Lol.

I offered $150k under asking which was understandably shot down. The seller has only one other offer which is contingent on the buyers selling their house first. And THAT buyer is contingent on selling their house. So it's a great big ladder where the deal can't get done unless everyone sells their homes. So here we are and all 3 houses have all been sitting on the market with no buyers.

Making my personal contribution to lower the housing market! Lol

I appreciate the contribution to the lowering the housing market, lol. Currently looking for a house in NH and would love for sellers to bring their expectations back to reality.

While I agree it may be cooling to some extent, I'm mostly seeing price cuts on houses with very undesirable qualities, grossly overpriced homes, and homes more in 600k+ range (still quite out of the affordability range for most people not going into a purchase with a large equity position from a prior home sale, particularly with NH real estate taxes being so high).

So many variables, I can't figure out which direction the housing market will go. At the end of the day, I firmly believe most first time home buyers are extending themselves beyond comfortable means, and I don't understand how the current situation will be sustainable.

Archipelago

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Re: Real Estate Forecast for Next Few Years (2024 - ?)
« Reply #15 on: September 08, 2024, 05:53:15 PM »
At least around here in NH, houses are sitting on the market and experiencing price cuts. The market is definitely softening.

The last 3 years where all that money was flowing? Not flowing so much anymore.

I'm going to look at a house this weekend that's priced at $710k and if it's the right house for us, would make an offer for $180k under asking. Yes, I'm cool with doing that. There's another comparable house for sale priced at $585k and has been sitting on the market for over 60 days (including through the summer months which is the most popular time to buy).

I have a strong hunch there will be no other offers, the open house will be sparsely attended, and the house would not appraise anywhere near $710k. This feedback only helps the listing agent and seller.

As an update, I went to that open house this weekend. I was 100% right. Crickets. I was the only one there. It was me, the realtor and the loan officer. Lol.

I offered $150k under asking which was understandably shot down. The seller has only one other offer which is contingent on the buyers selling their house first. And THAT buyer is contingent on selling their house. So it's a great big ladder where the deal can't get done unless everyone sells their homes. So here we are and all 3 houses have all been sitting on the market with no buyers.

Making my personal contribution to lower the housing market! Lol

Wait a month, then make the offer again. A bit of reality might help.

*rubs hands together*

It's starting to get very entertaining being in a buyer's market and holding the cards. It hasn't been this way for a while.

Archipelago

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Re: Real Estate Forecast for Next Few Years (2024 - ?)
« Reply #16 on: September 08, 2024, 05:58:33 PM »
At least around here in NH, houses are sitting on the market and experiencing price cuts. The market is definitely softening.

The last 3 years where all that money was flowing? Not flowing so much anymore.

I'm going to look at a house this weekend that's priced at $710k and if it's the right house for us, would make an offer for $180k under asking. Yes, I'm cool with doing that. There's another comparable house for sale priced at $585k and has been sitting on the market for over 60 days (including through the summer months which is the most popular time to buy).

I have a strong hunch there will be no other offers, the open house will be sparsely attended, and the house would not appraise anywhere near $710k. This feedback only helps the listing agent and seller.

As an update, I went to that open house this weekend. I was 100% right. Crickets. I was the only one there. It was me, the realtor and the loan officer. Lol.

I offered $150k under asking which was understandably shot down. The seller has only one other offer which is contingent on the buyers selling their house first. And THAT buyer is contingent on selling their house. So it's a great big ladder where the deal can't get done unless everyone sells their homes. So here we are and all 3 houses have all been sitting on the market with no buyers.

Making my personal contribution to lower the housing market! Lol

I appreciate the contribution to the lowering the housing market, lol. Currently looking for a house in NH and would love for sellers to bring their expectations back to reality.

While I agree it may be cooling to some extent, I'm mostly seeing price cuts on houses with very undesirable qualities, grossly overpriced homes, and homes more in 600k+ range (still quite out of the affordability range for most people not going into a purchase with a large equity position from a prior home sale, particularly with NH real estate taxes being so high).

So many variables, I can't figure out which direction the housing market will go. At the end of the day, I firmly believe most first time home buyers are extending themselves beyond comfortable means, and I don't understand how the current situation will be sustainable.

Cool, where are you looking? We live in the Upper Valley area. Used to live in southern NH. Depending on where you're looking, I may be able to look for some leads for you.

I'm seeing the same thing with price cuts. The highest priced homes get hit first and the hardest, which makes sense since most people can't afford them. But I'm also seeing lower priced homes $400k range especially, just sit on the market. Granted they're like 1300 sq. ft. homes with 3 beds, 1 bath, no garage listed for $400k, which is comical.

I can see the market continuing to slow but pick back up if interest lates were lowered again. That's what my anecdotal experience & crystal ball tell me.

clarkfan1979

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Re: Real Estate Forecast for Next Few Years (2024 - ?)
« Reply #17 on: September 08, 2024, 10:29:28 PM »
At least around here in NH, houses are sitting on the market and experiencing price cuts. The market is definitely softening.

The last 3 years where all that money was flowing? Not flowing so much anymore.

I'm going to look at a house this weekend that's priced at $710k and if it's the right house for us, would make an offer for $180k under asking. Yes, I'm cool with doing that. There's another comparable house for sale priced at $585k and has been sitting on the market for over 60 days (including through the summer months which is the most popular time to buy).

I have a strong hunch there will be no other offers, the open house will be sparsely attended, and the house would not appraise anywhere near $710k. This feedback only helps the listing agent and seller.

As an update, I went to that open house this weekend. I was 100% right. Crickets. I was the only one there. It was me, the realtor and the loan officer. Lol.

I offered $150k under asking which was understandably shot down. The seller has only one other offer which is contingent on the buyers selling their house first. And THAT buyer is contingent on selling their house. So it's a great big ladder where the deal can't get done unless everyone sells their homes. So here we are and all 3 houses have all been sitting on the market with no buyers.

Making my personal contribution to lower the housing market! Lol

Wait a month, then make the offer again. A bit of reality might help.

*rubs hands together*

It's starting to get very entertaining being in a buyer's market and holding the cards. It hasn't been this way for a while.

I don't know the NH market. In my market in southern Colorado, the sellers still have the cards. If they don't get the price they want, they just take the house off the market. In order for the buyers to be holding the cards, we need a big increase in supply, which we don't have. We have a small number of overpriced homes on the market that don't immediately sell.

Volume is down. My wife is a personal assistant for a real estate agent in Denver. Her volume in 2023 was 50% of 2022. It's looking like 2024 is going to be better on volume than 2023, but not as good as 2022. 

Paper Chaser

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Re: Real Estate Forecast for Next Few Years (2024 - ?)
« Reply #18 on: September 09, 2024, 05:22:43 AM »
At least around here in NH, houses are sitting on the market and experiencing price cuts. The market is definitely softening.

The last 3 years where all that money was flowing? Not flowing so much anymore.

I'm going to look at a house this weekend that's priced at $710k and if it's the right house for us, would make an offer for $180k under asking. Yes, I'm cool with doing that. There's another comparable house for sale priced at $585k and has been sitting on the market for over 60 days (including through the summer months which is the most popular time to buy).

I have a strong hunch there will be no other offers, the open house will be sparsely attended, and the house would not appraise anywhere near $710k. This feedback only helps the listing agent and seller.

As an update, I went to that open house this weekend. I was 100% right. Crickets. I was the only one there. It was me, the realtor and the loan officer. Lol.

I offered $150k under asking which was understandably shot down. The seller has only one other offer which is contingent on the buyers selling their house first. And THAT buyer is contingent on selling their house. So it's a great big ladder where the deal can't get done unless everyone sells their homes. So here we are and all 3 houses have all been sitting on the market with no buyers.

Making my personal contribution to lower the housing market! Lol

Wait a month, then make the offer again. A bit of reality might help.

*rubs hands together*

It's starting to get very entertaining being in a buyer's market and holding the cards. It hasn't been this way for a while.

I don't know the NH market. In my market in southern Colorado, the sellers still have the cards. If they don't get the price they want, they just take the house off the market. In order for the buyers to be holding the cards, we need a big increase in supply, which we don't have. We have a small number of overpriced homes on the market that don't immediately sell.

Volume is down. My wife is a personal assistant for a real estate agent in Denver. Her volume in 2023 was 50% of 2022. It's looking like 2024 is going to be better on volume than 2023, but not as good as 2022.

Redfin's data for Ft Collins shows transactions up 25%, Days on Market up 3 days, and selling price down 5% YOY.
Number of homes selling over asking is currently under 20% (peaked at nearly 80% back in 2022), and almost 30% of homes have seen price drops (up ~5% YOY):

https://www.redfin.com/city/7006/CO/Fort-Collins/housing-market

GilesMM

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Re: Real Estate Forecast for Next Few Years (2024 - ?)
« Reply #19 on: September 09, 2024, 06:41:00 AM »
At least around here in NH, houses are sitting on the market and experiencing price cuts. The market is definitely softening.

The last 3 years where all that money was flowing? Not flowing so much anymore.

I'm going to look at a house this weekend that's priced at $710k and if it's the right house for us, would make an offer for $180k under asking. Yes, I'm cool with doing that. There's another comparable house for sale priced at $585k and has been sitting on the market for over 60 days (including through the summer months which is the most popular time to buy).

I have a strong hunch there will be no other offers, the open house will be sparsely attended, and the house would not appraise anywhere near $710k. This feedback only helps the listing agent and seller.

As an update, I went to that open house this weekend. I was 100% right. Crickets. I was the only one there. It was me, the realtor and the loan officer. Lol.

I offered $150k under asking which was understandably shot down. The seller has only one other offer which is contingent on the buyers selling their house first. And THAT buyer is contingent on selling their house. So it's a great big ladder where the deal can't get done unless everyone sells their homes. So here we are and all 3 houses have all been sitting on the market with no buyers.

Making my personal contribution to lower the housing market! Lol

Wait a month, then make the offer again. A bit of reality might help.

*rubs hands together*

It's starting to get very entertaining being in a buyer's market and holding the cards. It hasn't been this way for a while.

I don't know the NH market. In my market in southern Colorado, the sellers still have the cards. If they don't get the price they want, they just take the house off the market. In order for the buyers to be holding the cards, we need a big increase in supply, which we don't have. We have a small number of overpriced homes on the market that don't immediately sell.

Volume is down. My wife is a personal assistant for a real estate agent in Denver. Her volume in 2023 was 50% of 2022. It's looking like 2024 is going to be better on volume than 2023, but not as good as 2022.


A large fraction of sellers in every market are relocating out of the area or are purchasing another house.  They don't have the option to "just take the house off the market" and wait for prices to rise.

FINate

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Re: Real Estate Forecast for Next Few Years (2024 - ?)
« Reply #20 on: September 09, 2024, 08:04:27 AM »
At least around here in NH, houses are sitting on the market and experiencing price cuts. The market is definitely softening.

The last 3 years where all that money was flowing? Not flowing so much anymore.

I'm going to look at a house this weekend that's priced at $710k and if it's the right house for us, would make an offer for $180k under asking. Yes, I'm cool with doing that. There's another comparable house for sale priced at $585k and has been sitting on the market for over 60 days (including through the summer months which is the most popular time to buy).

I have a strong hunch there will be no other offers, the open house will be sparsely attended, and the house would not appraise anywhere near $710k. This feedback only helps the listing agent and seller.

As an update, I went to that open house this weekend. I was 100% right. Crickets. I was the only one there. It was me, the realtor and the loan officer. Lol.

I offered $150k under asking which was understandably shot down. The seller has only one other offer which is contingent on the buyers selling their house first. And THAT buyer is contingent on selling their house. So it's a great big ladder where the deal can't get done unless everyone sells their homes. So here we are and all 3 houses have all been sitting on the market with no buyers.

Making my personal contribution to lower the housing market! Lol

Wait a month, then make the offer again. A bit of reality might help.

*rubs hands together*

It's starting to get very entertaining being in a buyer's market and holding the cards. It hasn't been this way for a while.

I don't know the NH market. In my market in southern Colorado, the sellers still have the cards. If they don't get the price they want, they just take the house off the market. In order for the buyers to be holding the cards, we need a big increase in supply, which we don't have. We have a small number of overpriced homes on the market that don't immediately sell.

Volume is down. My wife is a personal assistant for a real estate agent in Denver. Her volume in 2023 was 50% of 2022. It's looking like 2024 is going to be better on volume than 2023, but not as good as 2022.


A large fraction of sellers in every market are relocating out of the area or are purchasing another house.  They don't have the option to "just take the house off the market" and wait for prices to rise.

As already discussed in this thread, real estate is extremely local. Not sure we can make blanket statements about the motivations of large fractions of sellers across all markets.

Here in Boise it's more what @clarkfan1979 describes. Prices have softened and homes are taking longer to sell, yet low inventory persists though this is improving.

Migration is a big factor. Something like 10x the number of people are coming vs leaving with around net 50k gain in the Treasure Valley between 2020 and 2023 (the most recent data). While not a great source, Redfin search data suggest this migration trend continues. I don't see this changing until the influx greatly decreases and/or a lot more housing is built (My own bias is for both of these to happen and for prices to have long period of slow decline, but this may be wishful thinking.)

Many of the people leaving have been priced out of the housing market. In other words, they aren't current homeowners and cannot afford increasing rents. Some are long time homeowners who want to live in a smaller city. These folks can often hold out for a higher price and will change to being a landlord if they don't get the price they want.

To be sure there are some motivated sellers (e.g. divorces, job loss), however these properties are on the market for very little time, often with multiple offers. There are still way more buyers than sellers.

I don't know what southern CO is like, but this dynamic seems to hold to some degree throughout the Intermountain West as those from more expensive markets come for lower cost of living and easy access to the outdoors.
« Last Edit: September 09, 2024, 08:06:21 AM by FINate »

clarkfan1979

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Re: Real Estate Forecast for Next Few Years (2024 - ?)
« Reply #21 on: September 09, 2024, 04:29:38 PM »
At least around here in NH, houses are sitting on the market and experiencing price cuts. The market is definitely softening.

The last 3 years where all that money was flowing? Not flowing so much anymore.

I'm going to look at a house this weekend that's priced at $710k and if it's the right house for us, would make an offer for $180k under asking. Yes, I'm cool with doing that. There's another comparable house for sale priced at $585k and has been sitting on the market for over 60 days (including through the summer months which is the most popular time to buy).

I have a strong hunch there will be no other offers, the open house will be sparsely attended, and the house would not appraise anywhere near $710k. This feedback only helps the listing agent and seller.

As an update, I went to that open house this weekend. I was 100% right. Crickets. I was the only one there. It was me, the realtor and the loan officer. Lol.

I offered $150k under asking which was understandably shot down. The seller has only one other offer which is contingent on the buyers selling their house first. And THAT buyer is contingent on selling their house. So it's a great big ladder where the deal can't get done unless everyone sells their homes. So here we are and all 3 houses have all been sitting on the market with no buyers.

Making my personal contribution to lower the housing market! Lol

Wait a month, then make the offer again. A bit of reality might help.

*rubs hands together*

It's starting to get very entertaining being in a buyer's market and holding the cards. It hasn't been this way for a while.

I don't know the NH market. In my market in southern Colorado, the sellers still have the cards. If they don't get the price they want, they just take the house off the market. In order for the buyers to be holding the cards, we need a big increase in supply, which we don't have. We have a small number of overpriced homes on the market that don't immediately sell.

Volume is down. My wife is a personal assistant for a real estate agent in Denver. Her volume in 2023 was 50% of 2022. It's looking like 2024 is going to be better on volume than 2023, but not as good as 2022.

Redfin's data for Ft Collins shows transactions up 25%, Days on Market up 3 days, and selling price down 5% YOY.
Number of homes selling over asking is currently under 20% (peaked at nearly 80% back in 2022), and almost 30% of homes have seen price drops (up ~5% YOY):

https://www.redfin.com/city/7006/CO/Fort-Collins/housing-market

When I go to Zillow, Fort Collins is up 1.8% YOY. My zip code 80526 is the same. Colorado recently ruled that Fort Collins, "3 unrelated rule" is now unconstitutional. You cannot have housing discrimination laws based on family status. Previously, no more than 3 unrelated adults were allowed to share a house.

It became official on July 1, 2024. For people who own a large college house within 1/2 mile of campus (myself included), the value of those houses instantly went up by about 8-10% with the rule change, because you can now get 10% more rent without doing anything. You can get 10-20% more rent with minor renovations (converting extra living space into an additional bedroom).

https://www.zillow.com/home-values/4764/fort-collins-co/