The housing market has been market by high home prices over the past year or so. This has been fueled in part by low interest rates and a variety of other market factors. Regardless of causation, the fact is that home prices may be reaching a peak. This is motivating many home owners to sell, because they’re afraid the market will take a dive and significantly reduce their equity. A sudden increase in home sales means increased supply, which in turn causes homes to stay on the market longer and sell for less money These conditions can induce panic. Sellers may significantly reduce price in order to “get ahead” of a declining market, thereby accelerating the market decline. A selling frenzy may at this point, eventually leading to a housing market collapse.
The take away is to avoid jumping into the market, as any home purchased now may decrease in value soon. If you’re interested in buying a home, you might consider waiting until home prices start dropping so you can be on the right side of the market.
Our office has consulted with thousands of home owners over the years. Feel free to give us a call if you’re interested in a free consultation with a Fairfield bankruptcy attorney.
Categorized in: Loans