Today’s Real Estate Market: The ‘Unicorns’ Have Galloped Off

Comparing real estate metrics from one year to another can be challenging in a normal housing market. That’s due to possible variability in the market making the comparison less meaningful or accurate. Unpredictable events can have a significant impact on the circumstances and outcomes being compared.  Comparing this year’s numbers to the two ‘unicorn’ years we just experienced is almost worthless. By ‘unicorn,’ this is the less common definition of the word: “Something that is greatly desired but difficult or impossible to find.”  The pandemic profoundly changed real estate over the last few years. The demand for a home of our own skyrocketed, and people needed a home office and big backyard.  Waves of first-time and second-home buyers entered the market. Already low mortgage rates were driven to historic lows.  The forbearance plan all but eliminated foreclosures. Home values reached appreciation levels never seen before. It was a market that forever had been “greatly desired but difficult or impossible to find.” A ‘unicorn’ year. Now, things are getting back to normal. The ‘unicorns’ have galloped off.  Comparing today’s market to those years makes no sense. Here are three examples:  Buyer Demand  If you look at the headlines, you’d think there aren’t any buyers out there. We still sell over 10,000 houses a day in the United States. Of course, buyer demand is down from the two ‘unicorn’ years. But, according to ShowingTime, if we compare it to normal years (2017-2019), we can see that buyer activity is still strong (see graph below): Home Prices We can’t compare today’s home price increases to the last couple of years. According to Freddie Mac, 2020 and 2021 each had historic appreciation numbers. Here’s a graph also showing the more normal years (2017-2019): We can see that we’re returning to more normal home value increases. There were several months of minimal depreciation in the second half of 2022. However, according to Fannie Mae, the market has returned to more normal appreciation in the first quarter of this year. Foreclosures  There have already been some startling headlines about the percentage increases in foreclosure filings. Of course, the percentages will be up. They are increases over historically low foreclosure rates. Here’s a graph with information from ATTOM, a property data provider: There will be an increase over the numbers of the last three years now that the moratorium on foreclosures has ended. There are homeowners who lose their home to foreclosure every year, and it’s heartbreaking for those families. But, if we put the current numbers into perspective, we’ll realize that we’re actually going back to the normal filings from 2017-2019. Bottom Line There will be very unsettling headlines around the housing market this year. Most will come from inappropriate comparisons to the ‘unicorn’ years. A real estate professional is a great resource to help you keep everything in proper perspective.

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PCSing to a San Antonio Military Base? Here's your JBSA 101

Welcome to San Antonio, also known as Military City USA - home to the largest joint base in the Department of Defense. At Joint base San Antonio, we host 10 major commands, more than 40 general officers and senior executives, and maintain more historic buildings than Williamsburg, Virginia. In total JBSA supports 266 diverse mission partners, 80,000 personnel and over 565,000 families and retirees in the surrounding area. JBSA is home to more DOD students at more active runways than any other military installation. We are also home to the DOD's largest in-patient hospital and only level-one trauma center. With the Air Force as the lead agency for JBSA, the installation is made up of three primary locations - JBSA Fort Sam Houston, Lackland and Randolph, and eight other operating locations. Major mission partners at JBSA Fort Sam Houston include; US Army North, conducting homeland defense, and civil support operations and theater security cooperation activities. US Army South, whose area of responsibility includes 31 countries in 15 areas of special sovereignty in Central and South America and the Caribbean. Installation Management Command, whose synchronized integrate and deliver installation services. Army Medical Center of Excellence, where the US Army educates and trains all of its medical personnel. The Medical Education Training Campus, where training occurs for about 24,000 enlisted personnel annually from all the military services. Brook Army Medical Center, where there are about 75,000 emergency room visits each year. And geographically separated, Camp Bullis provides state-of-the-art training facilities that fully support the training required of DOD mission partners. Major mission partners at JBSA blackland include: The 37th training w graduating 80,000 from Air Force basic technical security and international training. Within the 37th is the Defense Language Institute and the Inter-American Air Force's Academy. The 59th Medical Wing, providing premier healthcare, medical education, and research and readiness. 16th Air Force leading information warfare for the air force by integrating multi-source intelligence surveillance and reconnaissance, cyber warfare, electronic warfare and information operations capabilities. Air Force Installation and Mission Support Center. Responsible for providing installation and mission support capabilities to 77 installations, nine major commands and two direct reporting units in order to build and maintain the foundation of the Air Force. 433rd Airlift Wing, home of the formal training unit for all C-5 Galaxy Air crews. And 149th Fighter Wing, an F 16 flying training unit and Premier Fighter Wing in the Air National Guard. Major mission partners at JBSA Randolph include: Headquarters Air Education and Training Command. The Air Force's major command charged with recruiting, training, and educating America's airmen 19th Air Force. Responsible for training more than 30,000 US and allied students annually in numerous specialties ranging from air crews, remotely piloted aircraft crews, air battle managers, weapons directors and survival, escape resistance, and evasion specialists 12th Flying Training Wing, training 850 instructed pilots and 500 remotely piloted aircraft pilots and sensor operators annually. Air Force Personnel Center, providing services and community programs to airmen worldwide And Headquarters Air Force Recruiting Service, inspiring, engaging, and recruiting the brightest, most competitive and diverse men and women for the Air Force, overseeing installation support across all JBSA locations. The commander of JBSA is Gen. Russell Driggers as the 502nd Airbase Wing Commander. The Wing conducts 49 installation support functions to include security forces, civil engineering services, communications, legal, logistics and safety. There is no place like JBSA, and this is ever-present in the strong partnerships we have with military City USA and the surrounding region. JBSA is one of the largest employers in the state of Texas, contributing $13 billion to the local economy, and over $30 billion to the state. We're supported by over 1000 civic leaders, four congressional districts, four counties, and 20 smaller communities. Simply put, the soldiers, sailors, Marines, airmen, guardians, and Coast Guardsmen and government civilians across JBSA are making a difference here and to the nation. The success of our military mission is absolutely intertwined with the success and resilience of the city of San Antonio, and the surrounding communities. Joint Base San Antonio - "Partnership in Excellence".

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Owning a Home Helps Protect Against Inflation

You’re probably feeling the impact of high inflation every day as prices have gone up on groceries, gas, and more. If you’re a renter, you’re likely experiencing it a lot as your rent continues to rise. Between all of those elevated costs and uncertainty about a potential recession, you may be wondering if it still makes sense to buy a home today. The short answer is – it does. Here’s why.  Homeownership actually shields you from the rising costs inflation brings. Freddie Mac explains how:  “Not only will buying today help you begin to build equity, a fixed-rate mortgage can stabilize your monthly housing costs for the long-term even while other life expenses continue to rise – as has been the case the past few years.” Unlike rents, which tend to rise with time, a fixed-rate mortgage payment is predictable over the life of the mortgage (typically 15 to 30 years). And, when the cost of most everything else is rising, keeping your housing payment stable is especially important. The alternative to homeownership is renting – and rents tend to move alongside inflation. That means as inflation goes up, your monthly rent payments tend to go up, too (see graph below): A fixed-rate mortgage allows you to protect yourself from future rent hikes. With inflation still high, when your rental agreement comes up for renewal, your property manager may decide to increase your payments to offset the impact of inflation. Maybe that’s why, according to a recent survey, 73% of property managers plan to raise rents over the next two years.  Having your largest monthly expense remain stable in a time of economic uncertainty is a major perk of homeownership. If you continue to rent, you don’t have that same benefit and aren’t as protected from rising costs. SBottom Line A stable housing payment is especially important in times of high inflation. Connect with a real estate agent so you can learn more and start your journey to homeownership today.

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