We just returned from the Keller Williams national conference in New Orleans. And while we enjoyed a few really great dinners, we worked our brains hard to learn all the information available to be the best advocates for our clients. Because, after all, that is what being a real estate agent is truly all about. Representing our clients and their interests.
And while we do not possess that magic ball that gives us the future, we had access to some of the best minds in real estate, finance and banking. They all agreed on the same thing…a shift in the market is coming. There is no question. It is coming.
What does that mean in detail rather than the ominous tones of The Game of Thrones “Winter is Coming” predictions? Those details shared included the effects of high education costs and the recovery of the market after the 2008 crash. What does that mean in terms of selling a home? The market is a seller’s market right now because most home that were underwater are no longer so, interest rates are still low, and banks are lending again. Unemployment is at an all time low and millenials are finally entering the real estate market looking for homes to purchase. However, this will not last and here’s why.
I was almost bowled over by the staggering statistics of the cost of higher education and the skyrocketing rate of increase. The cost has gone up nearly 400% in the past decades, while income has remained nearly flat. The student debt average in 2005 was $17,333 and in 2015 was $35,000. Imagine trying to buy a home when you have a student loan payment of $300 plus a month, a car payment, health insurance, car insurance, and credit card payments. This does not take into account any savings. Where is that money coming from. All on the average starting salary of $62,000 a year, which would be a great salary with little or no debt with which to contend.
What does this mean for the housing market? Fewer homes being bought. Millenials (1980-2000) are starting to buy homes now after a decade of waiting. They are (very) slowly beginning to purchase homes. Chattanooga is seeing this rise in the sale under $200k homes with multiple offer situations. The sale of those homes means that the sellers are looking for a home to buy, completing the cycle. Now is the time to sell.
However, this will not last long . The younger millenials continue to graduate with more and more debt (an additional $2,000 each year) and the new generation of students graduating college will begin in 2022, six short years from now. Their crippling student debt could completely shut down the housing market and all of the jobs related to housing. Also, this education bubble is just like all the other bubbles (housing, tech, etc.)…it will pop!
If you are considering selling your home, now is the time to do so. Our team is selling homes in all areas of Chattanooga because we are pricing them right and helping our clients take advantage of the sellers market. We also understand that a buyer is making an investment that must stay valuable. Our goal as a team it to make sure we protect the interest and future of all of our clients. Call or text us today to learn more. 423-664-1900 or firstname.lastname@example.org