All Forum Posts by: Alan Walker

Well, we did it. We hit 1101 active single family homes under 700k in Salt Lake County. Congratulations?

Days on market continue to climb. So for anyone that is actively trying to sell their house, stop blaming your realtor. It all comes down to how motivated you are to sell your house. You can stay at the same price you're at and wait longer or you can lower your price to sell faster. This is standard supply and demand. No bubble bursting here.

Houses are still selling. They are taking more time. Up to today, median home price in Salt Lake County for August is 602,000, so basically the same as July.

But let's have some perspective people, median home price in August 2020 was 433,550. Median home price in August 2021 was 545,000 and today we are at 602,000. 10 years ago, August 2012, median home price was 225,000.

From August 2020 to now, we've had 30% appreciation. From August 2012 to now, we've had 268% appreciation in median home price. That is unprecedented and most likely not happen again in our lifetimes.

Expecting that to continue indefinitely is insanity.

Remember when housing was a solid, conservative, long-term investment at 3-5%?

I guess all I can say is, CALM DOWN MARY FRANCIS, it's all going to be okay. #realtor #housing #investment #realestate #utah

You know that part of summer when the excitement of being out of school or anticipation of vacations makes everything sparkly?

Then as summer starts winding down, it gets a little boring cuz you know fall is right around the corner?

Yea, that's the market right now. Sluggish, staying about the same week over week. Fish tacos aren't as appetizing after that trip to Maui. You know, late August.

NAR announced, and by announced I mean they sent a press release to the news, that we are now in a "housing recession". That feels like a scary way of saying the mania we've seen for 2+ years has ended.

We haven't uploaded to the Cloud just yet, which means housing is still a fundamental necessity of society.

We still have a housing shortage in Utah. That shortage can be inventory related or it can be affordability related. In either case, holding real estate for the long term is always the smart thing to do.

Our inventory continues to grow. I wouldn't be surprised if we hit 1100 by September. The question I get asked a lot is "What's normal?" and I think that's the wrong question. I think the right question is "where's it trending?".

Prices are trending downwards with median home price at 650,000 in May and 600,000 in July. Will this continue? Gurl, I ain't got no crystal ball!

What does it mean if you are buying for yourself? Should you wait and see if prices continue to drop? Maybe. But what if rates keep going up? The people that bought at 500,000 in January are paying less per month than the people who bought at 450,000 in July. Find the right house that you want to be in for 5-7 years. That's what's important.
Marry the house, date the rate.

What about for investors? Deals are already happening on the MLS. I'm seeing more seller-finance deals broadcast on the MLS every week. Good long-term investors haven't been betting on appreciation. They are betting on cash flow. In that sense, nothing has changed. What I can say from my own personal investing experience is that if you are doing a refi to get out of hard money, be VERY conservative with your estimated appraisal value.

Want some great news? People still need places to live! Whether its for yourself or for some renters. Don't lose yourself in the noise. Real estate has value because it serves a purpose.

That purpose hasn't changed. Stay focused on that, and you can weather the storm.

We've seen a leveling off this week. Active homes dropped slightly, days on market are all double digit. Fewer price reductions and more expired listings.

Hard to say if we have reached "the new normal" yet.

Median sales price in Salt Lake County for the month of July is 600,000 per the MLS. Down 50,000 from two months before. That is less than 10%, correction territory. So far the trend is going down for median sales price, which is a relief to most.

We'll have to see what August's median sales price is to see if we are continuing down or if we are indeed leveling off to a new normal.

I'm not sure if it was RBG or Madonna that said, "You've got to let your body go with the flow". That's all we can do right now. Vogue.

'Member when I was sounding like a broken record about low interest rates and low inventory? Yea, it's kind of like that but in opposite world. 

The Fed just announced another .75% increase in the prime rate (that isn't an exact correlation to mortgage rates but its heavily influencing it).

Our inventory continues to increase, almost at 1100 single family homes under 700,000 in Salt Lake County, at this pace we may be closer to 1250 by the end of August. For context, we were under 200 in January.Days on market are finally showing up. 

One thing to note is that I am doing this on a 7 day look-back (kind of why its market of the MOMENT). Which means, it's the average days on market in that price range that closed in the last 7 days. It will undoubtedly conflict with a monthly or quarterly number of average days on market because the pool of homes is smallest at 7 days.

Is now a good time to buy real estate? Well, it depends on what you're trying to accomplish. If you are trying to find a place for you and your family that you plan on living in for 3-5 years, most likely. If you are trying to buy something and sell it in 18 months and expect to get a 20% bump in equity, meh, not so much. And that's okay. Calibration is needed when coming out of such a crazy market cycle. Unless the Great Salt Lake dries out and starts blowing cyanide up and down the Wasatch Front, this is not the end of the world. Long term, a slow down is better for the market.

I feel like I need to be really loud about this. DON'T WAIT FOR THE MARKET TO "BOTTOM OUT". IT DOES YOU NO GOOD TO GET A HOUSE FOR 50,000 LESS IF YOU ARE PAYING 3 TIMES THE INTEREST RATE. 

We all want a deal. Fixating on price as the only lever to make something a deal will get you rekt in our current mortgage climate.

A day early today since I'm in a conference tomorrow.

Well, we are here, over 1,000 homes under 700k in Salt Lake county. Days on market for the homes that closed in the last 7 days were low compared to last week, those days on market are the average between the homes that closed that week. So don't throw a fit Trevor Thompson.

Who is really winning with the high interest rates? It isn't sellers or buyers, it's the banks. They are the only ones getting ahead. Sellers aren't getting what they could have gotten six months ago and buyers are paying more per month than they were 6 months ago.

Yet, why is now still a good time to buy real estate? Because interest rates are continuing to go up!

A market like this takes an investor mindset even if you are only buying your own home to live in. People are more concerned about what their monthly payment is versus the cost of the house.

It's easy to say "the market is still too high, people are lowering prices, I'll just wait until the bottom hits." But here's the thing, how do you know we've hit the bottom? Its when we start going back up! There is no timing the bottom in real estate.

If prices go down but the interest rate continues to go up, how are you benefitting from "the bottom"? You're still paying more per month in mortgage payment.

Median home price in Salt Lake County is telling. In May the median home price in Salt Lake County was $650,000. So far in July, the median home price is $600,000.

I'm about to do maths, so bear with me here, I promise a punny ending!

A loan payment on 650,000 (supposing nothing down) at 3% is 2,740.43. A loan payment on 600,000 (supposing nothing down) at 6% is 3,597.30. At 7% and 550,000 its 3,659.16. See where this is going?

Don't look at the purchase price and think that's all that matters. If you are buying, buy while rates are where they are at now. The Fed said they are meeting 7 times this year to talk about raising rates. 7 times!

OK, maths done.

Instead of a pun, I'd like to know how many people want to see me in a video as a Victoria Secret swimsuit model?

We continue to see the number of active homes rising. Largest increases were in the 400-500k and 600-700k ranges.

Days on market saw some big increases.

We haven't talked about absorption rate in a while because our inventory has been so low. Absorption rate is a metric that indicates, if we were to continue selling homes at the current rate, how long would it take us to run out of homes, assuming no new homes hit the market.

We got to under a month for quite a while. We are now at 2.93 months. The standard benchmarks to indicate a sellers or buyers market was 3-6 months of inventory was a sellers market, 6 months is a balanced market and 6-9 months is a buyers market. That gives you some insight into how crazy our market has been.

The question all of us have is, how will this impact prices in the short-to-medium term? I guarantee that 6-8% interest rates will become the new normal eventually, but how long are people willing to wait before they finally understand that 3% is a thing of the past?

I think the people that are losing out the most right now are the folks that could have bought in the last 2 years but were "waiting for the market to cool down". One factor that wasn't entering people's minds was interest rate. Its great it you get a house 50,000 less than it was last year, but you are paying 400 more per month for that 50,000 discount because of the interest rate.

So was it really worth the wait?

We are now over 900 active homes in Salt Lake county under 700k. Pendings and solds are both down. Interestingly, the days on market decreased also.

Many people are taking vacations in July and August, so not totally uncommon to see a slow down. The current slow down is really all about interest rates and buyer sentiment.

188 price reductions and 11 expired/withdrawn homes in the last 7 days. If median price went down by 10%, is it really that bad? We had 30% appreciation last year to this year, so even if prices dropped 10%, we are still 20% higher than last year. We need to keep things in perspective.

Today someone asked me if the bubble has burst. I don't think so. We all have collective amnesia to what a normal market looks like. Sellers now have to have patience and buyers now have choices. Oh how the tables have turned! 😂

We are still in a healthy market. If I could give one piece of advice (free and worth every penny), it would be
CALM DOWN MARY! The sky isn't falling. Everything is a cycle. No cycle goes up to infinity.

Real estate is a long game. Up to now we've been power walking through a mall. Now we are just power walking through a mall with ankles weights........and a rolled bandana just like Olivia Newton John in the Physical video.

We are now over 900 active homes in Salt Lake county under 700k. Pendings and solds are both down. Interestingly, the days on market decreased also.

Many people are taking vacations in July and August, so not totally uncommon to see a slow down. The current slow down is really all about interest rates and buyer sentiment.

188 price reductions and 11 expired/withdrawn homes in the last 7 days. If median price went down by 10%, is it really that bad? We had 30% appreciation last year to this year, so even if prices dropped 10%, we are still 20% higher than last year. We need to keep things in perspective.

Today someone asked me if the bubble has burst. I don't think so. We all have collective amnesia to what a normal market looks like. Sellers now have to have patience and buyers now have choices. Oh how the tables have turned! 😂

We are still in a healthy market. If I could give one piece of advice (free and worth every penny), it would be
CALM DOWN MARY! The sky isn't falling. Everything is a cycle. No cycle goes up to infinity.

Real estate is a long game. Up to now we've been power walking through a mall. Now we are just power walking through a mall with ankles weights........and a rolled bandana just like Olivia Newton John in the Physical video.

Well, I'm back from Portugal and back from the gut bug I picked up there (but I did lose 7 pounds so silver lining!). I missed two weeks of reporting so instead of 7 days, this is since the last 21 days.

What a great way to see the SHIFT that has already happened and continues to happen in the market. While the numbers don't indicate we're in a "buyers market", they definitely indicate that buyers have way more choices than they did a couple weeks back (inventory has over 300 MORE HOUSES than 3 weeks ago).That is a tectonic shift in inventory. Rates are a huge factor in this. A 400k home would cost about 1750 a month earlier this year and now costs closer to 2200. Let's have THAT conversation.

We are finally seeing double digit days on market. For some context, in a balanced market, it could take anywhere from 30-60 days on market before a house goes under contract. So let's not scream the sky is falling because we are at 15.

Here's the question, how long will it take sellers to realize they don't have as strong of an upper hand as they thought they did?

I added "Total Price Reductions" to the chart because that is a great indicator of what's happening. Price reductions doesn't necessarily mean prices are going down. They mean the seller and agent were overzealous in what they thought they could get and the market is telling them "No, Ma'am!".

What a time to be alive!