I know there is a lot of concern about our slowing real estate market over the past several months and questions of how bad it is or may get. Here are some excerpts from Bigger Pockets who advises real estate investors in their emails/blogs that puts a good perspective on our current situation: “In the grand scheme of things, prices would have to decline a lot just to wipe out the gains of the last few years. Indeed, housing prices fell 33% in The Great Recession, which, if it were to occur again, would only wipe out the gains real estate has made since the beginning of 2020!” and “The thing that many forget is that 2008 was not just a significant decline in home values. It was a financial crisis predicated on a massive number of defaults, foreclosures, bank failures, and bailouts. In other words, prices falling was not a crisis in and of itself. Instead, prices going down triggered that crisis as it created a feedback loop as additional foreclosures caused home prices to decline further and so on as things spiraled out of control. And while mortgage default rates are rising, they are still significantly below historical averages (see graph below). The only major similarity between 2008 and today is that housing prices are soaring. Virtually everything else is different and makes a collapse unlikely. So, the answer to whether investors should panic is no.”
(512) 853-0110 or robert@AustinTxHomeSales.com
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