Do You Think the Market Will Crash?
As we all know we have been in a bull market for the last 10 years, which marks one of the longest in history. With the economy so strong all businesses are doing well. Especially when we look at the real estate market, prices have been appreciating year over year significantly in the Neenah area.
In late 2018 we saw the FEDS raise the interest rate a few points causing a panic to begin. The thoughts of “are rates going to continue to rise” & “rates are becoming ridiculous” we’re mentioned on the regular. Since late 2018 rate increases have stopped & the announced plan for 2019 is to stay stable with a possible slight interest rate increase. This is great news for everyone looking to buy!
But according to the article written in Slate News the yield curve is showings signs of another economic recession. In my professional opinion I do not see it going anywhere near what it was in 2008-2009. With that said, I know the Midwest has never been as turbulent when it comes to compression & expansion regarding the economy. Typically we see about a 10-15% decrease in values which still isn’t all that terrible. If you are on the east or west coast you could predict a 25-35% dip if something were to happen. This causes chaos around the United States & the real estate market as a whole.
Now what can you do to avoid this?
Be Smart with your money. Don’t go out & buy a brand new vehicle if you can’t afford it if your income drops by 10-20%. Think about renting a property for the time being till the economy shifts into a buyers market for real estate purposes. Then you can capitalize on lower values & sell during the peak. It is impossible to time things perfectly, but as history repeats itself over & over again we can try to be as close to perfect. Now when you are buying a house what should you watch for?
- ARM Loans that are due in the next 5-7 years
- Inflated Neighborhood Prices
- Rolling Closing Costs Into Your Home
- Find a house that could also become a rental if needed
- Don’t buy speculative property right now UNLESS you’re a professional
- Think through every purchase you make
I hope this article provided some insight as to what to expect during the next economic recession. If you are interested in a cash offer on your property please fill out the form below.