What does all this mean for buyers? Real estate is, and always has been, cyclical to some extent. Through the boom years, we would say that what goes up, must come down. Now it seems that the opposite should also be true: What went down, will come back up. There is still an opportunity in our area, which isn’t true in much of the country—especially the coasts—to get normal appreciation on purchases, given the current state of prices. We know that investors have been increasingly drawn to our state, because of the high prices in Boston and NY. Why would locals not invest as well? While we’ve been reading about the woes of Connecticut, others have been coming from out of state and out of the country, and buying and buying. With our deeper knowledge of the local market, we should be able to do better than they could. So let’s make a resolution in 2019: Buy local!
Friday, December 28, 2018
Reaping the Rewards?
Now that the stock market has started to rally so strongly, maybe it’s time for people to take what they’ve made, and buy real estate instead. In our region, prices are still very low, compared to even twenty years ago. We used to have average home prices well above the national average, so that job recruits moving here were worried about finding affordable housing comparable to their previous homes. Now, we are very close to the national average, and we haven’t gone up, in some areas, enough to cover the declines of the last decade. Commercial prices have been bumping along, also not moving up over time. Some industrial buildings are at prices equal to those of years ago. While some towns have a shortage of smaller commercial spaces, others have empty big box stores, many of which could be repurposed. We are very short on affordable housing in our region, and the gap keeps growing, as rents continue to rise. Even as housing prices for homes have declined, rents have doubled, and many tenants are paying a percentage of their incomes for rental units that is considered to be onerous.