It’s November 30th, one day removed from the official start of December, and we’re now fully immersed in the holiday season.
We’re also in the last quarter of 2022.
And all year, we’ve been talking about the wackiness that has been the real estate landscape and housing market, with one thing on everyone’s mind:
Are we heading for another housing market crash?
Is it already here?
Will it continuein 2023?
I’ve talked about this previously, and I think it’s important to discuss because there’s some reason for concern, especially if you lived through the crash of 2008.
Jamil’s 2023 Housing Market Forecast
First and foremost, talking about our current market is, let’s face it, a pretty hot topic.
My Astro student members are talking about it and that was actually a topic of one of my most recent coaching calls.
And I get it. I lived through the 2008 crash, as did a lot of us, and I lost a substantial amount of money; so of course if you remember that, the way the market’s been lately, it’s gonna make you worry.
And that’s understandable.
Yes, housing prices have risen – along with everything else – and a lot of markets have seen unaffordable housing and yes, the Federal Reserve has been on a tear about raising interest rates.
But with all of this, I don’t believe that we’re headed for a crash. As I’ve mentioned before, we’re actually headed and are in a correction.
First thing, the inventory of houses hasn’t bloated.
When inventory bloats, you’ll see thousands of properties on the MLS. In 2008, in Maricopa County, there were between 60-70,000 property listings on the MLS.
At the same time, all of these houses were using what was called “ninja loans”; these were loans or garbage mortgages that were given to people that had no income and no jobs to pay off these loans.
So you had people buying 3, 4, or 5 houses without the ability to pay the mortgages on them. These were borrowers who were unqualified and that had a profound effect in the aftermath.
So now, lending has become very, very, very difficult and those standards have gotten very high. That means you don’t see those types of ninja loans or garbage mortgages now.
And even with the changes that the Fed has been making this year, no one is underwater.
What I think is happening right now is a housing correction. Now a correction and a crash are two different things:
A market correction is a drop in housing prices by 10% and happens gradually
A market crash is a drop in housing prices by 20% and happens suddenly
2008 saw an inventory bloat, with pricing dropping considerably in quick succession; that’s not what we’re seeing now.
Check out my explanation in the video below:
The great thing about what’s happening is there is still a lot of opportunity for us as wholesalers and investors because we have a tremendous amount of control right now.
And as such, we should be chasing those properties that have been just sitting on the market for 30, 60, or 90 days.
What do you think of my 2023 forecast? Join us in AstroFlipping or check out our Facebook group.