ECONOMIST SAYS HOME PRICES NEED TO FALL BY A THIRD TO MAKE THE MARKET AFFORDABLE
I’m trying to close on buying a home as I write this, and let me tell you it’s been quite the experience so far. But I must say that generally speaking, the current real estate market is essentially insane. Because nothing makes sense, and it’s hard to be strategic when nothing makes sense. Like, at all. I’ll expand on that shortly. But I found it noteworthy that one economist went on the record about how much prices would have to fall to make homes affordable again for most buyers. And they came up with a pretty shocking amount, which is that home prices would have to fall by as much as a third of the totals today.
Read More: Scientists Looked At Toothbrushes And Found More Than 600 Viruses
AFFORDABLE HOME PRICES NEED TO HAPPEN TO MAKE THE REAL ESTATE MARKET ACTIVE AGAIN
The economist is Chen Zhao, who serves as the economics research lead at Redfin RDFN, a real-estate brokerage you’ve probably heard of. Chen noted that most people who would (or should) be in the market to buy a home aren’t, for the simple reason that the current prices are just too expensive. Chen said to MarketWatch, “A healthy housing market is a more active one, where people who want to move are able to.” And that’s the kernel of the reality today when it comes to real estate and home prices: they’re just not affordable, and prices need to drop by a third. So now I’ll try to explain why I and my family are not only in the market, we’re about to close on purchasing a home.
Related:
HOME PRICES ARE QUITE THE BUBBLE, BUT THE RENTAL REAL ESTATE PRICES ARE EVEN WORSE
We’re in the market to buy a home because our rental of 5 years is about to become too expensive to live in. And yes, this adds more onions to the insane real estate soup, even as prepping them (sic) involves tears of frustration with discovery. We found that we could save $500 a month, right now, by buying a home even with the current interest rates. And that is insane. Because it means that the rental market is an even bigger bubble than the real estate market. And that means neither is sustainable, yet there’s no end to the insanity of current home prices in sight.
The current median-priced home in America is roughly $383,000. And Chen believes that the market needs a correction via a price drop of about $121,000. Think about those numbers, and you’ll feel my consternation and smell the salt of my onion-prepping tears in deciding to buy a home. In this market. It makes cents when there’s no sense to be found when it comes to home prices.
