Housing Crash 2021/When to Buy Our Forever Home

[Ray Miller]

We were considering purchasing our forever home now to take advantage of low rates.  We own land and rentals in the area we would be moving back to.  Houses and land in that area are at a peak price right now.  I have watched numerous speakers predicting a crash in 2021. We are probably a couple of years from retirement.  I have 85% equity in the house I live in. I am also debating when to sell this house. Should I wait to see what happens in 2021?  

[Marcus Auerbach]

@Ray Miller the word "houseing crash" alone guarantees clicks and tickets, so it is a very popular topic on social media. Fear based marketing, works also really well in politics. I work on the topic a lot and can not find any evidence that we will see a crash that would even remotely look like 2008. Back then we had an oversupply and high vacancies. Today we have not enough houses and too many buyers - 84 million millennials have started to buy and they are not going to move back home. 

We will probably see a good amout of forebearance deals go bad, but over 80% of them have a substantial amount of equity and can easily sell the property before having to face forclosure, which neither banks nor borrowers want. Whatever is left and will hit the market is going to be absorbed by demand quickly. 

I don't know about Texas, but I expect existing home prices in Wisconsin to keep going up, as they tend to follow new construction prices, which are on the rise and more than double of existing homes.

We pay significantly more for lumber, OSB and plywood. Yesterday I found out that appliances have gotten pricy too, about 20% more for a typical stainless steel kitchen package for a rental - and lead time! Looks like inflation is starting to climb too.