It’s springtime here in Baltimore and I just got back from a conference where we talked about the expectations of the real estate market this year. I heard from the oracle of real estate, who has been giving his predictions, and it sounds like we’re going to have a great year from what he’s saying.
He showed a couple slides that proved his point, which you can see in the video above. Over the last 18 years, you can see the growth of the U.S. existing home median sale price. He said that if we figured in a normal appreciation of 3.6% per year, you can see that we’re about right on track with where we should be right now, historically speaking.
“A recession doesn’t mean depreciation.”
Another thing we talked about was recessions. A common misconception about recessions is that they are always followed by a drop in home values. However, a recession doesn’t mean depreciation. Three of the last five recessions led to an increase in home prices. The only one that bucked the trend was the 2008 recession, where the market dropped 20% on average.
Today’s market is different. We are starting to see a slow, steady appreciation which shows that we’re going to continue to see this over the next few years. If we do hit a recession in 2020, in most cases, we won’t even see depreciation. Long-term real estate is still a great investment and will be in the coming years. With low interest rates and steady appreciation, it’s a great time to buy.
If you have any questions for me about the past, present, or future of our real estate market, don’t hesitate to give us a call or send us an email. We look forward to hearing from you soon.
