Is Spokane's Housing Crash Inevitable?

Buying a home in Spokane right now is like going on Tinder, swiping left for an hour; there are so many prospects, but none are interesting. That is exactly like what is going on in the market. There's so much inventory and an increase of 178 from a year prior, but none of it is interesting. It's inventory that is either overpriced or not attractive. And the limited number of buyers that are actually out there looking can be very picky and strategic about which homes they submit offers on the reason that the inventory selection is kind of poor right now.

Even though we have so much more on the market than we're used to, over the last two years, the number of new listings hitting the market that are actually coming for sale is down significantly. Not only are we currently heading into December when this video is recorded, which is historically a time in which inventory drops in Spokane, but we are also down 23% from this exact same time last year, meaning that we're missing out on a couple of hundred sellers that we traditionally have even at this time of year. So now, even though over a thousand homes are sitting for sale on the market here in Spokane. We don't have a rush of inventory to the market. We actually have less sellers coming to the market here in Spokane.

Something I want to show you is that most people are waiting for this housing correction. And a housing correction is generally brought to the market by a rapid increase in prices, which we did see. But that rapid increase in prices can generally be generated by some artificial thing. Spokane just went through a supply and demand issue but as part of this graph right here foreclosures even though up slightly are still at a historically low levels we are not seeing foreclosures come into the market in a way that they did in 2008 that allowed the market to drop in price so significantly and this graph right here shows what I already said that even though inventory is up new listings are down even though prices have gone up over the last year and a half to two years they have started to come down from a high of 400 150 000 here in Spokane they're currently sitting at three hundred and ninety two thousand a decrease of more than 10 percent here in Spokane now most people that are looking for a deal are excited that interest rates are higher because they feel like they can get a better price on the properties and we have definitely seen that Peak fall off and we are at a really steady stable rate here in Spokane now with home prices where they're at and with interest rates where they're at now people want the prices to continue to go down but does it make sense for them to continue going down well not only have interest rates made the prices come down because there was less buyer activity but interest rates have caused sellers to not list their home because according to Matthew Gardner the chief Economist for Windermere Real Estate it is believed that nearly 30 million homeowners have an interest rate below 3 percent in America so not only are interest rates preventing first-time home buyers from entering the market but they're also causing home owners to not want to list their properties and bring inventory to the market so they can go purchase something else so it is causing a lack of buyers and a lack of sellers in our Market this is leading the National Association of Realtors Chief Economist Lawrence Young to believe that prices will remain steady over the 2023 and then Rebound in 2024 and continue to go up when interest rates are expected to go down so there's never a perfect time to buy or sell a home you cannot time the market if I could time the market I would be much wealthier person and you would be a much wealthier person as well what we can predict right now is that as long as nothing catastrophic happens interest rates stay in the mid 60s where they are at home prices will stay steady or have a very slight increase in 2023 and then if interest rates do drop into the fives maybe fours over the next couple of years we know that there's going to be another round of pent-up demand searching for Homes at that time because we as a country are not building enough homes to prevent this supply and demand issue that we went through in 2020 and 2021 one from happening again all I can say is that I think 2023 is going to be a fantastic year to purchase a home if it's the right time for you if your finances are in a great position go out there and buy a house you're going to lock in an interest rate that will either work for you because you can afford the payment that you get qualified for you're going to be happy if they go up that you locked it in at the rate you did and if they go down you can just refinance drop your payment to what the current market rate is if you're a seller there's a lot of Doom and Gloom out there in the market right now but it is still historically a great time to sell your property was it better a year and a half ago 100 it was absolutely better you're gonna get 15 offers on your property not have to do anything you could just put a sign in the yard and get it sold but today you have to work a lot harder to get that property sold you need to fix things you need to price the price property properly and take professional photos videos and do the whole nine yards because you do have competition your neighbor now will be your competition because there's only one buyer for your neighbor ahead now not 20. if you have any questions about the real estate market here in Spokane, my name is Hayden Halstead with the Halston home team. I would love to help you out. If you're buying, selling, or investing in the area, reach out to me. My contact information is down below.