Timing The Real Estate Market—Simply a Waste of Time
Do you find yourself waiting for your local real estate market to “crash” so you can make your move and “clean up?” While prices will certainly change over time, trying to time the moves in your favor will likely prove elusive—it’s simply impossible, even for seasoned real-estate veterans to forecast local real estate prices in the short term. Long-term pricing, in an economically viable area, will likely go higher—it’s just a question of time.
I’ll use a real-life example—my own. I purchased my home on the east side of Petaluma in 2005 during a prior “buying frenzy.” My realtor was putting out multiple offers to try and make an offer “stick”—any offer! We received acceptance on a typical single-family home—3 bedroom, 2 ½ bath with 1669 square feet—absolutely nothing special, but it cost $635,000 18 years ago–right before the mortgage meltdown, and the ensuing foreclosure crises that gripped the nation. Just like an auto mechanic that can’t fix his own vehicle, I, a real estate professional, managed to purchase a home, almost to the day, of the beginning of a massive downturn in real estate prices.
We continued to make our mortgage payments for some time and eventually the Sonoma County Assessor’s Office devalued our property for tax purposes to a low of $275,000 in 2009, at which time I really wanted to just walk away from the “underwater” property like so many other folks had done. The wife simply reminded me that was not going to be an option—not at all. So, we grinded it out and managed through it. Fast forward 2022—I had an appraisal completed seven months ago—came in at $1,089,000! We went through a peak to trough cycle and lasted through another up cycle to find we had built some serious equity by not timing the market, but by owning it!
The point is that the only way to keep up with ever-rising real estate prices in a desirable location like Sonoma County is to participate in it. I have far too many clients that have sat out for way too long only to watch home prices march ever higher. If you own property, you are building equity and keeping up with the real estate market. If you’re sitting it out waiting, the market will sooner or later price you completely out from ever owning a home in this area.
Not only can median prices go higher here in the beautiful wine country—they will. I can’t tell you what prices will look like next week, or next month, but I know where they will be in 10 years—very likely higher. Participate, or you will be forced to relocate!
It’s just a matter of time—not timing…
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