Among the most Googled question as the new year begins are variations on “Will the housing market crash?” It’s a sensible query, but only for anyone who believes that Google can see into the future. Some of the variations, like “Should I wait for the housing market to crash before I buy a house? assume not only that Google engineers have solved the ancient art of soothsaying but that market timing is the most important step in buying a house.

The popularity of those queries can probably be attributed to the commendable human impulse for caution. If you don’t know what the future will bring, you should at least see what the experts are thinking. If common sense teaches that even experts can’t really be relied upon when it comes to market timing, shouldn’t you check out what they say, anyway—at least you’re doing something!

There is one point that should relieve some of the anxiety that prompts the query. After all, clarity is called for when large purchases (like buying a home in St. Cloud) are on the table—and fear has a way of crowding out rational factors, even if they would tame its sway.

For most people, the last global financial meltdown and accompanying real estate crash looms in memory as near-catastrophes. For some who had depended on an uninterrupted boom, it did have serious consequences. But in fact, what at the time seemed to be the beginning of an endless plunge, when viewed from a long-term perspective now can be seen as a temporary dip. The Federal Reserve’s graphic representation of House Prices Sold from 1965 to Now makes that point undeniably clear. Seen in their entirety, the line representing the steady upward march of U.S. home prices was only briefly interrupted from the first quarter of 2007 to the same quarter of 2009, during which it did turn dramatically downward. But that only took place for those two years. From that point until the end of 2011, prices actually held steady—neither rising nor retreating. Thereafter, they resumed their habitual gains at a rate that entirely obliterated the effects of the crash.

As was sometimes noted during the “meltdown” period, homeowners who had no reason to sell their St. Cloud homes could have contentedly ignored the whole phenomenon. Except on paper, it didn’t affect them. For prospective homebuyers today whose principal goal is to seek a residence they plan to enjoy over the long term, the Fed’s graph should be greatly reassuring. 

For all your St. Cloud real estate questions, call me anytime!    

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