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The Truth About The Housing Market And What You Should Do
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Oct 20, 2023
#realestate #housingmarket #blackexcellence Where is the real estate market really headed and what you should really focus on. Link to "90 Days of Black Excellence" : https://a.co/d/0snjJq0 Subscribe to our channel so you don't miss any future videos! Add your email to our list to stay updated- BlackExcellence.com Check out the books we love and recommend in our Black Excellence Book Club: https://www.blackexcellence.com/store/ Some links are affiliate links, which means we earn a very tiny commission if you make a purchase. __________________________________________________________ Fueling your journey of excellence through wealth content. All content provided by Black Excellence Media, LLC is for entertainment purposes only. None of the information or advice provided is to replace professional advice.
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There is much to be said about the housing market, like how unaffordable it has become
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and why the interest rates still keep climbing up. There are a million and one predictions about where the market is headed, but whose predictions
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can you actually trust? Will prices keep climbing up or are we due for a massive housing crash
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like the one we saw in 2008? And how will the black community be impacted either way
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In this video, I will not be making any predictions. I'm not a housing expert
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Instead, we will look at the facts, how the black community is doing is doing when it comes to housing, and we will also look at some overpriced markets that
0:34
might be impacted the most if there is a housing crash. And most importantly, we will discuss
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key qualifications you should have if you want to buy a house in this or any other market
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So where does the housing market stand now? After the insane price increases in the housing
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market after COVID hit us in 2020, the market finally started slowing down in late 2022
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Home prices appeared to finally see some correction, and some markets did see a dip in price
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The hyper-competitive market where people were outbidding each other, sometimes without even touring the house, was now seeing a fall in offer
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But prices slowly started climbing up again for the median house price to reach a near all-time high of $413,800 this past August
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As for interest rates they soared past a 20 high of above 7 also in August So with interest rates this high why are house prices not falling as rapidly as they normally would That has to do with the lack of inventory There are simply not enough
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homes for sale. Home buyers that bought their houses, while interest rates were rock bottom, are
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reluctant to put their houses on the market, even at high prices because that would most likely
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mean they would have to buy a new house at a much higher price at a much higher interest rate
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A recent Redfinn study showed that 82.4% of current homeowners are locked in below the 5% interest rate mark
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Home builders that felt the pain of the 2008 housing crash are cautious about the pace of building new homes
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although it might not feel like that in some markets that are flooded by new home constructions
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And how is the black community affected by all this? Black families saw the sharpest increase in home ownership in 2021 since the Great Recession of 2008
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which also marked the first time the community saw the share of the rental market dropped since 2000
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Although this might be good news, we have to also remember how much the black community was crushed during the housing market of 2008
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Mortgage companies were purposely targeting the black community with subprime mortgages that trapped families into interest rates that kept rising until the point many lost their homes due to the inability to keep up with mortgage payments
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This time around, however, it is a hopeful sign that mortgage lending practice
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practices are much more strict and most mortgages come with a fixed interest rate
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Now that we talked about where the national housing market stands let look at some of the most overpriced real estate markets in the U According to a recent research done by Florida Atlantic University the top five overpriced markets include Lakeland Florida Memphis Tennessee Charlotte North Carolina
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Cape Corral, Florida, and at the number one spot, the most overpriced market, we have Atlanta, Georgia
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This ranking was determined by comparing expected home values against average list price
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So if you plan on buying a property in any of these areas, you should especially pay attention to our keys
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to buying a house confidently. Like I mentioned at the beginning of this video
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nobody knows for sure where the real estate market is headed. It can keep going up in price or it can crash and burn
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Here are the best things you can do to protect yourself in case of a crash
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in this market or any real estate market. The number one key to buying a house confidently
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is to make sure you can actually afford the house you're buying. And buy a Ford, we mean very comfortably afford
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This might seem obvious, but too many people buy homes they can't afford thinking home values will only go up
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This is a huge mistake. According to the 28% rule, you should keep your mortgage payment under 28% of your gross income
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which is your income before taxes are taken out. When you buy a house, you can't simply look at the mortgage payment you will be paying every month
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According to many financial experts, you should add at least 15% of your mortgage
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to your expenses every month to simply maintain the home. This should account for expenses like fixing whatever inevitably breaks in your house or unexpected costs that come up
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like that washing machine or dishwasher breaking If you a renter you would simply call your landlord When you own your house you are the landlord Another key to confidently buying a house is to plan to stay there
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for at least 10 years. If property values keep going up and you want to sell three years after
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buying, then great. You lost nothing. But when you want to make a purchase like buying a home
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you should have a plan for what to do if things go south. If property values tank, but you stay put
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chances are prices will recover in about 10 years and you won't have to take a loss on the property
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A final key that I believe is so important is that you don't view your home as an investment
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We've all heard that buying a home is the best investment that you'll ever make
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but that's far from the truth for many families. You might get a far better return for your money if you invest in the stock market or a small business
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That's because most people simply look at the mortgage payment and how much house prices have gone up over the years
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without accounting for how much money was spent on home maintenance fees
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compared to simply renting. Your home should be a place that you want to live
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The value it gives you should be far greater than just monetary value
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It should be a place where you can comfortably afford, meaning you have enough money left over to make investments
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If values go up and you make a profit, that's just icing on the cake
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If you pay attention to these keys to confidently buying a home
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then you won't have to worry about where the real estate market is headed. Well, that's it for this episode
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We'll be back with more money talk. Don't forget to check out my journal, 90 Days of Black Excellence
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the journal that helps you get to where you're going in 90 days
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