The Bright Side Of A Cooling Market

I saw an article in Forbes recently discussing the “cooling” real estate market. That adjective to describe the housing market probably gives potential sellers the chills, while exciting many potential home-buyers. But, many home buyers are actually wondering if buying a home now, with rates at 7%, is a smart move.

The answer to that? Owning a home is always a smart investment. If you plan to own the property for at least five years, you can bet on it paying for itself in the end. If you want to read more good reasons for prioritizing a home for purchase, I highly recommend clicking on the Forbes link up above. It’s worth checking out!

The news always sensationalizes issues as a whole, it is all doom and gloom. However, most people buy or sell homes due to life events such as marriage, job in another city, another baby, a divorce or a death. Rates rarely are thought of when life happens. I bought my house in 1999 at 8.5% not knowing any difference or thoughts about the rate. It was an interest only purchase, however the next 13 years it was refinanced over 7 times. I ultimately ended up with 2.75% 30 year fixed. In that time, the value of my home has increased 4 times the initial price. I now have a ton of equity in my home, which I would not have it I didn’t purchase a home. Buying our home used all our savings and it was tight for the first couple of years. Best investment I ever made.

Other reasons to buy a property some of which are highlighted in the Forbes article as there are many: (1) avoid rising rents with a fixed housing payment; (2) tax advantages; (3) ability to do what you want with the home; (4) forced savings/retirement nest egg; (5) pride of ownership; and (6) inflation hedge.

Finally, this transitioning market makes it easier for buyers to get a home, prices have come down, there are not as many offers, you are not competing against 20 offers and having to remove all your contingencies. You can actually ask for a credit or repairs and get it. Some are predicting rates will go down sometime next year, if that happens, prices and competing will go up and you can just smile while sitting in your new home and start the refi process for a lower payment.

10 Housing Trends for 2020

This time of year, there are a ton of “housing market prediction” pieces flooding the airwaves. Some are crazy, many are measured, and when you put them all together, you get a fairly clear picture of where experts think the industry is headed in 2020.

Below, we’ve gathered the top 10 predictions from a few different sources (, WaPo, and Forbes, to be exact). I’ll add my two cents at the bottom, but here are some possibilities for housing in 2020:

1. Moderate Growth in the Housing Market

New home sales are expected to rise, but existing home sales will remain held down by a lack of supply. Overall, this equals an expectation of moderate growth.

Image result for housing market

2. Continued Low Rates

The National Association of Realtors (NAR) expects the 30-year fixed-mortgage rate will remain below 4 percent in the coming year, moving to 3.8 percent by the end of 2020.

3. Hottest Home Appreciation Markets? Not in CA

The NAR expects 10 markets to have home price appreciation that outpaces the rest of the country over the next 3-5 years. None are in California:

  • Ogden, UT
  • Las Vegas, NV
  • Fort Collins, CO
  • Colorado Springs, CO
  • Dallas/Fort Worth, TX
  • Columbus, OH
  • Raleigh/Durham/Chapel Hill, NC
  • Charlotte, NC
  • Charleston, SC
  • Tampa/St. Petersburg, FL

4. Home Prices Will Flatten

Don’t expect to see a surge in home prices – experts at think they will only increase 0.8 percent nationally. They expect prices to decline in some major cities, including San Francisco.

5. Again, Top Markets Shut Out CA agrees with the NAR in that California won’t have any of the top markets in 2020. Their list:

  • Boise, ID
  • McAllen, TX
  • Tucson, AZ
  • Chattanooga, TN
  • Columbia, SC
  • Rochester, NY
  • Colorado Springs, CO
  • Winston-Salem, NC
  • Charleston, SC
  • Memphis, TN
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Downtown Colorado Springs

6. Competition Will Increase

Redfin thinks that 1 out of 4 offers will face a bidding war. This increased competition might push price growth up to 6 percent higher in the first half of the year, before it evens out to a more moderate 3 percent.

7. Revenue Will Fall

The Morgage Bankers Association expects lenders to chase fewer loans. They say purchase applications will be up slightly, while refinances will be lower.

8. Millennials Will Shape the Market data shows that Millennials made up a whopping 46 percent of all mortgage originations in September 2019 (meanwhile, that share of Baby Boomer and Gen X mortgage activity declined). And they’re looking to move into smaller, suburban towns on the outskirts of major metros. Forbes says they want places with live-work-play neighborhoods with the safety and affordability of suburbs AND the transit, walkability, and 24-hour amenities of the big city.

9. The Industry Will Continue to Digitize

Manual, paper-laden processes are old news. Tech-savvy Millennials are entering the market at a fast pace, so the real estate industry is adjusting to meet their demands. Get ready for e-signing everything!

10. California’s Market is Changing

According to, three of the top four metro areas seeing the largest decline in inventory are in Northern California (San Jose, Sacramento, and San Francisco-Oakland).

Image result for housing market

From what I am seeing and in conversation with other agents the 680/24 corridor will have a robust spring. I had one of the busiest Decembers ever and expect the will continue into the first quarter. The challenge will be finding buyers homes, as I think most will have multiple offers.

Next January, we will have to revisit these prognostications and see which ones were on the money$$$.