When Will Housing Prices Fall?
Housing prices having been rising steadily since the beginning of this year. In 2016, housing prices had dropped by around 4%, however by now it has risen 8% above that! People are wondering if and when housing prices will fall. While there’s no way to know for certain, housing prices have shown a pattern over the years revealing a few key indicators of what is likely to happen in the future.
Many People are Stilling Buying
Despite the increase in prices for this year, houses are still being sold at their increased prices. By now, there are many people who are unable to afford housing and are forced to rent. However, those who are making a high-end wage are still capable of buying houses at the increased prices. A large number of people are buying multiple houses simply because they expect those houses to increase further in value as the months go by. New and improved houses are being built faster than ever before, which you would expect to reduce housing prices. Unfortunately, this is not the case as property value continues to grow. However, as we are about to discuss, this is not likely to go on forever.
Prices Will Reach a Failing Point
Based on past housing price changes, there will eventually be a point in time where the average wage is not enough for the majority of people. When this happens there will be a large number of houses that will be unable to sell. There will still be some areas that are able to sell at higher prices based on location, but for most areas, the prices will suddenly be too high. When this occurs, many house owners will start thinking about adjusting their prices. At this point in time, there will be such a high demand in houses, yet not so many buyers who can afford to go ahead with the payments.
Housing Prices Should Balance Out
At this point, housing prices will have no choice but to balance out for the most part. When there are more houses being built than being bought, property value will decrease drastically. This will be good for those who previously couldn’t afford a house of their own; however, for home owners it could be a grave decrease in profit, assuming they’re able to make any profit! Houses in non-expensive areas will become basically worthless with a value set lower than the original value it was bought for! You would assume people would just sell off their property before this occurred but that brings us back to the initial issue with all our assumptions; no one knows when this housing price decay will occur. So, bottom line; will housing prices fall? Yes, they will! In the meantime, we will have to deal with the overpriced houses and attempt to find good deals when and where we can. For current home-owners, beware the downfallen prices! If you plan to sell properties, it is recommended to look into it in the next few years. As for those of us who have yet to afford a house of our own, perhaps we can look for a good real estate agent who may be able to find us a good deal. It never hurts to look!