US Pending Home Sales Fall to Second-Lowest Level on Record

Real estate is not exactly a liquid commodity market. Because sales are fairly infrequent, sellers tend to try to wait out buyers' markets by simply not selling.

This means you are not likely to see as high a volume of sales in a down market, at least at first. This slower movement of property can prop up prices in the short term as pent up demand (waiting for a lower price) competes to purchase.

You will more likely only see prices plummet if the down market lasts long enough that sellers can no longer wait, and/or sellers see that waiting will only bring a lower price. Inflation doesn't help here, as it makes waiting to sell more attractive.

If it were me, I'd make sure to track properties, and engage at lower price points. People may not take it, but eventually, you may be the best/only one offering to buy.

Oh, and remember, the 'price' you see is the asking price. That is hardly ever the sales price.

Some of my favorite finance-related quotes:

1. No one panic sells their home. 2. You can't live in an Excel spreadsheet.

Demand is low because half of America has bought with an existing interest rate that is unprecedentedly low.

It’s hard to sell a mortgage with 3% interest to get a new one that’s double

I would guess that most of the sustained price of houses just comes from people trading their existing house which also tripled in value for another one, above a certain cost in markets with very little comparable income earners willing to spend on it.

The house I live in the basement of is valued at $2m, but was $700k a few years ago. Everything in my neighborhood is around the same, and it's otherwise a neighborhood of not super rich people. Who's buying them? It's either going to be newly extremely wealthy people or people who just sold their $2m house.

Nobody's been left holding the bag yet.

>How can demand be the lowest it's ever been but prices not budge

2% apr on a 30 year mortgage; you'd be nuts to move right now.

That's what happens when central planning is used to warp...erm, I mean organize...an economy.