Waiting for the wild housing market to calm down before buying a place?
Don’t bother, said Barbara Corcoran, the founder of the Corcoran Group real estate firm and star of “Shark Tank,” during a CNN Business Foreseeable Future discussion on the current housing market madness. “I don’t think it is wise to wait,” Corcoran told CNN anchor and chief business correspondent Christine Romans on Thursday. “Of course, if you can’t find a house, you have to wait. But to make it part of your plan to wait until house prices come down, I don’t envision that happening over the next few years, at least not for the next year.”
Sales of homes have cooled a bit recently from the red hot pace of earlier this year, but home prices continue to climb. This has many would-be homebuyers wondering if prices will come back down, or at least stop going up so quickly. But waiting could cost you more, Corcoran said. If US home price appreciation maintains a pace similar to the past year, she said, homebuyers are going to pay another 12% to 14% for the same house next year. Goldman Sachs recently forecast home prices would increase by another 16% by the end of 2022.
Inevitably, the hot housing market has drawn comparisons to the 2006 housing bubble. But Corcoran does not think this is a bubble, because the high prices are not artificially supported by shady lending practices the way that sub-prime lending led to foreclosures during the last housing crisis and there aren’t a lot of flippers in the market. “We don’t really have a bubble, what we have is an usual market that’s just gone bonkers based on individual demand of the people who want to live there,” she said. “I have never seen a housing market like this. I spent almost 50 years in the real estate business. I’ve never seen prices nationally go up at this kind of a rate.”