Momentum Affects the Real Estate Market

by Rachel Baker on May 31, 2015

The article below seems to be written about a specific real estate market in (I think) Canada, but there is some information that makes sense for understanding all real estate markets from small town Florida to big city New York.

Here’s the article:How momentum effects the real estate market

The first question is, why did this happen? The answer to that is beyond the scope of this space, but it can be summed up by the statement that for every action there is an opposite reaction. What goes up must inevitably come down. Momentum soared in 2012 as more buyers than normal entered the market; it was only natural that there would then be less of them to purchase in the years that followed. Add to this more restrictive lending policies, shortened amortizations, slowed population growth, and self-fulfilling ‘doom and gloom’ prophecies. There was enough friction in the market to grind things to a halt.

Now, in 2015, there are signs of a market recovery, leading to the second question: What can the physics of 2012-2014 tell us about the potential for this year? Well, it has taken a couple years, but lenders — and more importantly buyers — have now adjusted to the new regulations. In addition, rates are obscenely low.

This article was written by: Rachel Baker – Click to follow on Twitter; or you can follow her at The Crafty Veteran on Bloglovin

Comments on this entry are closed.

Previous post:

Next post: