Now can someone please tell me what exactly is a real estate bubble? Does anyone really know? The "talking heads" spew the words out of their mouth as though it is a disease and do they really understand? Is there a cure for the disease? Consumers all over the world need this answer. Our home is not a simple commodity it is our life!
The definition found on Google.com is as follows;
• A real estate bubble or property bubble (or housing bubble for residential markets) is a type of economic bubble that occurs periodically in local or global real estate markets. It is characterized by rapid increases in the valuations of real property such as housing until they reach unsustainable levels relative to incomes and other economic indicators, followed by rapid decreases that can result in many owners holding negative equity (a mortgage debt higher than the value of the property). ...
en.wikipedia.org/wiki/Real_estate_bubble
I don’t know about you but that just sounds that if you buy at the right time or sell at the right time you have made a wise financial decision and if you have not there is always someone to blame. I understand that sometimes things happen beyond our control and we cannot choose the market in which we have to work but happily this is rare.
We have just come out of a whopping sellers market and are working through the cycle to a buyers market. How is that a bubble? According to the definition above prices would had to have risen quickly and extremely and be falling just as quickly and that is just not the case. Prices rose considerably over a 5-7 year period and will somewhat subside and level out. In most areas the prices of homes have still appreciated just at lower levels than before. That does not sound like the bottom is dropping out to me.
Stop listening to everyone! Find yourself a good REALTOR® and listen to them. That’s what we are here for. This is our job. We study the market and adjust to what is necessary. I know that can be sooo hard! Everywhere you go, everyone is an expert on the subject whether it’s reading the news or standing in line at the grocery store. Everyone you meet will have a story, some good, and some bad. So stop listening! Do some research yourself, interview REALTORS®, find one you like and trust and listen to them. They will make no decisions for you just help you to be as informed as you can to make the proper decisions yourself.
Now I keep referring to REALTORS® and a REALTOR® is a real estate agent who has gone the extra step to take an oath to be honest and honorable and do the best job that we can. Much like a Doctor or Lawyer takes an oath to do the best they can. Professionalism is what it means.
Back to the bubble. You can avoid any sense of this by planning wisely. Try not to sell when it’s a buyers market and don’t try to buy when it’s a sellers market. It’s really pretty simple and should alleviate considerable extra stress. Remember two very important things; get professional help and your home is your life but also your biggest investment. Think of it as both and you will make the right decisions.