The Current State of Home Prices: Answering Your Most Asked Questions

The Current State of Home Prices: Answering Your Most Asked Questions

It's no secret that the real estate market has been booming over the past few years. Home prices have been skyrocketing, and everyone has been eager to get in on the action. However, there are signs that this may be changing. Experts agree that we are starting to see a deceleration in home prices. This doesn't mean that prices are dropping – they're still appreciating, just not at the record-breaking pace they have over the past year or so. So what does this mean for buyers and sellers? What should you do if you're thinking of buying or selling a home? Keep reading to find out.

What is deceleration in the real estate market?

Deceleration is a term that is used in many different industries, but it is particularly relevant in the real estate market. Deceleration can be defined as a slowdown in the rate of growth or expansion. So, in the context of the real estate market, deceleration would mean that home prices are not growing as quickly as they were before. It's important to note that deceleration does not mean that home prices are dropping – they are still appreciating, just not at the same rate as before.

How will deceleration impact buyers and sellers differently?

For buyers, deceleration in home prices means that they may have a bit more bargaining power when it comes to negotiating a purchase price. This is especially true if the market is starting to slow down in their area. Sellers, on the other hand, need to be aware that buyers may be less likely to pay above asking price – especially if prices are continuing to decelerate. If you're thinking of buying or selling a home in this market climate, it's important to stay up-to-date on the latest trends and forecasts. Talk to a real estate agent who can help you make the most informed decision for your situation.

How will this trend play out over the next few years – will we see another housing crash, or will things level off eventually?

The deceleration of home prices is likely to continue over the next few years. While this doesn't mean that we're headed for another housing crash, it does suggest that things may level off eventually. Keep in mind, while we are seeing the number of days a home is on the market is increasing, inventory is growing, price reductions are happening, and contingencies are back, this is not a cause for concern. It is actually the opposite! These are all signs of a normal market - which we have not seen in some time. We are headed for a leveling off - not a housing crash.

Bottom line, home prices haven’t fallen or depreciated nationwide, they’re just decelerating or moderating. While some unique and overheated markets may see declines, nationally, home prices are forecast to appreciate. And when we look at the country as a whole, none of the experts project home prices will net depreciate or fall. They’re all projecting ongoing appreciation.

If you have questions about what's happening with home prices in Kern County, let's connect.