Is the Real Estate Shift Finally Here?

Wait! Could it be that the real estate bubble is about to burst? Are the days of “name your price” and “Multiple Offers! Submit your best and final by 5pm” coming to an end??Well, not exactly.?This is certainly still very much a seller’s market, but for the first time in a while we are seeing some key indicators signaling that the rocket-like trend is beginning to stall. Every morning, we pull a list of all homes for sale in the Charleston market. What was once totaling 6,000 or 7,000 active homes available in the market had been dropping to relatively microscopic levels…1,700, then 1,600, all the way down to below 1,300 homes for sale one morning.?We all were watching wondering how low it would go. Well, I am excited to report that it has started creeping back up, albeit slowly. As of today, there are 1,546 active homes for sale in the local MLS, and it has been over 1,500 for a few days now.?Indicator 1.

Next, and this one is equally interesting. A local new home builder that has been steadily raising prices, has actually turned even the new home buying process into a bidding war and has reduced buyer agent commissions down to 1% (disappointing, but they can do it) recently announced price reductions on some of their previously HOT inventory.?Whoa! Indicator 2.

Finally, and this one really has no precedent, we know that companies are now facing the challenge of bringing employees back into the office, which will come with its own opportunities and consequences. One national bank representative said, “if you can go out to eat in a restaurant, you can come into the office”.?We shall see. What we do see is that investors that were flooding into the residential real estate market now are starting to be able to buy commercial real estate for “unheard of” low prices, relatively speaking of course. Savvy investors prefer to buy low and sell high, and commercial real estate is low and residential is high. So??Indicator 3.

While I do not anticipate a "correction", I do anticipate a significant slowdown in the growth of home prices soon. I do not expect them to drop to below Covid-19 prices. The most agile real estate agents, investors and homeowners have a way of finding opportunities regardless of the conditions, and this crazy market is no exception.?Our team has already sold more homes (mostly representing buyers in a tough buyers’ market) than we sold all of last year in less than half the time, and 2020 was previously our best year ever. So be ready. Follow the indicators. Do your research. This is still a seller’s market, but the signals are there for a shift. What might that mean for you and your business? What steps are you taking to prepare for a shift??Please share your thoughts below.

Dan Delanty is the Founder/Owner of The Delanty Group with Coldwell Banker based in the Charleston, South Carolina area.