The National Association of Realtors® is a sunny organization whose pronouncements can be relied upon to promote (you guessed it) real estate. Like any gigantic organization (we have more than a million dues-paying members), the NAR tends to be cautious in its public pronouncements. But in last Wednesday’s article about the course of residential real estate in 2020, Steamboat Springs readers would have found the kind of sweeping statement that makes people think twice. “Is that really so?” “If that’s true, what then?”
The statement was this: the decade just past “has been the most consequential stretch in American real estate history…one that fundamentally altered the landscape.”
Quite a pronouncement.
There followed a quick summary of the decade just past, making a convincing case that so much has changed that it might as well be part of “a different landscape.” Ten years ago, “many homeowners were desperately hoping to hang onto their homes” and, “buyers were struggling with newly skittish lenders.” The turnaround in those crucial elements is undeniable, yes, but reversals in conditions happen regularly. What makes this decade’s about-face “the most consequential” ever?
Their answer boils down to the scope of the recovery combined with a dearth of entry-level housing starts. The recovery has meant a sustained, robust rebound in existing house values, but unaccompanied by the resurgence of entry-level builders who were stricken from the scene. Even as price rises are finally leveling out, the starter house inventory remains strikingly sparse.
This is happening as major demographic changes take place. Baby boomers and GenXers aren’t deciding to exit their homes in numbers that match previous generations—at precisely the moment that millennials are stepping up to become the most active group in the housing market…and there are 71 million of them!
According to the author, what it all adds up to is, among other things, a lot of competition for housing by young families deciding to have kids. This raft of buyers is resulting in a new reality. Among possible outcomes: high prices in coastal metros could see an increase in buyers’ willingness to settle down in less pricey environs.
Whether or not such shifts really will be among the most consequential in American history is far from certain. But today’s buyers are paying close attention to bottom lines—and sellers looking for speedy results are aware of it. Call me for up-to-the-hour details on what this fall has produced in our Steamboat Springs market.