Is the market going to go KABOOM?

[Kevin Parekh]

*This thread hasn't been written to instill fear or troll other investors!

So I am a new investor in the market (in Pensacola, FL). Important to note, that even though I have a professional degree and make over $100k a year, I have not bought a house bc I was waiting for the market to slow down. Needless to say, houses do not stay on the market very long in PNS. Most low income houses  ($100-150k) stay on the market for 15 min... not very long. Larger, more expensive house ($350k+) stay on the market for 2-3 months. 

I have a good chunk of money saved for a cash offer and a withering 1031 that I am pondering to trash. Why? I really think the market is gone wildly out of control in PNS. United Airlines just released information about laying-off 50% of their workforce, 17 million are on UE, and the $600 UE is about the expire... and the leads me the conlsuion that many houses may be on the market in 6 months.

What do you think is going to happen? Are you trying to save cash for the impending housing crash?

Thanks yall!!!

[Matt Jones]

I can't speak to what the overall economy and housing market will do but I was listening to a recent interview with one of the largest brokers and developers in Pensacola who is known for really digging into the market statistics and trends.  He said that Pensacola has a shortage of inventory(definitely true) and that it would take 3-5 years for inventory to catch up with demand.  If those 17 million unemployed people don't go back to work fairly quickly that will have a long term impact on our economy but assuming we don't head into a major recession it's unlikely that prices plummet.  Could they stagnate or drop a little?  Sure.  A major price drop seems very unlikely though.  I have put 4 homes under contract in the last week.  None of them lasted more than 3 days on the market and that is only because the owners were sorting through 3+ offers for each which means 2 or more buyers for each house that went under contract are still looking.  I believe in setting your buying criteria and sticking to it(don't overpay because the market is hot or you feel impatient) but if the right property hits the market now and meets your criteria I wouldn't pass on it in anticipation of getting a 2008 type deal 6 months from now.