Unsettling developments in the banking industry had been front-and-center in the national press for all of last week, so the headline in Realtor News was definitely effective clickbait. For any St. Cloud house buyer or seller concerned that a financial spillover might disturb their own plans, the promise would have been irresistible:

“How 3 Recent Bank Failures Could Impact Housing Market” would be hard to skip past if your St. Cloud house is already up for sale (or soon will be). The thing is, what seem to be disruptive events may not prove to work out that way when all is said and done—despite all the scare-inducing coverage (Realtor’s ‘bank failures’ story was illustrated by a cartoon depicting black-suited bankers disappearing beneath stormy waves).

How could a general banking industry mess be anything but a nasty technical complication for St. Cloud house sales? They weren’t widely acknowledged, but there were three possibilities:

·         First was the likely impact on mortgage rates. Realtor acknowledged that home buyers have been “up against affordability woes,” yet as of last week’s beginning, mortgage rates had fallen “about 50 basis points.” NAR’s Chief Economist Lawrence Yun predicted that, should rates head lower, “more buyers undoubtedly would respond” by entering the housing market.

·         Second, there is the perceived safety of real estate in troubled times. Its reputation as a solid wealth repository when other investment channels are threatened is widely accepted—and not only here in the U.S. Fast Company recently reported that 80% of global high net worth individuals believe that “purchasing real estate in the U.S. is a safe investment”—and that “international buyers are back.”

·         Third, as smartasset.com advised worried investors last week, “consider buying real estate.” Owners of rental properties with reliable tenants have a steady stream of income while they ride out rough patches. The 2008 housing market “turned out to be a boon for some real estate investors.”

The busy season for St. Cloud house sales traditionally coincides with the start of spring. Call me to check on the latest local activity!  

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