Winter is Coming... to the Housing Market! A Wizard's Forecast

A Shadow of Doubt Falls Upon the Shire... er the Market

Hoom! Well met dwellers of this realm! Gandalf the Grey at your service. I bring tidings though not of joy and feasting but rather a chill wind upon the housing market. Alas the spring blooms are wilting faster than oliphaunt lilies in Mordor! The numbers tell a grim tale: sales of previously owned homes have plummeted faster than a Nazgûl chasing hobbits down 5.9% since February. It seems even the most sturdy hobbit holes are struggling to find new owners. This is the slowest March sales pace since 2009! One might say 'Fly you fools!'... away from these exorbitant rates.

Not All Who Wander Are Lost But Some Can't Afford a Mortgage

The West that vast expanse of mountains and overpriced lattes has been hit the hardest. Prices there are so high even Smaug would think twice before settling down. Only the Rocky Mountain states show any signs of life likely due to a hearty supply of dwarven level job opportunities. But even they cannot hold back the tide of woe. The average rate on a 30 year fixed mortgage looms over 7% a fearsome number indeed. As I've said before 'All we have to decide is what to do with the time that is given to us.' But it seems that most people are deciding not to buy houses with that time.

One Does Not Simply Walk Into a House... With These Interest Rates!

Lawrence Yun a wise man of the Realtor folk speaks of 'affordability challenges.' Indeed! It's harder to afford a home than it is to resist the One Ring. He also laments the low 'residential housing mobility,' which to my old ears sounds like a hobbit lamenting his inability to outrun a warg. 'Home is behind the world ahead,' sang Bilbo. But what if home is too expensive to acquire in the first place?

The Inventory Rises Like Orcs From the Deep

Ah but there's a glimmer of hope like the light of Eärendil in the darkest night. The inventory of homes for sale is rising nearly 20% higher than last year. But alas this is a double edged sword. More homes for sale means slower sales and that is starting to put a chill on prices. It's a buyer's market you say? Perhaps but even a dragon wouldn't want to buy in these conditions.

Precious... Prices Ever So Slightly Less Precious

The median price of a humble abode is a staggering $403,700. An all time high no less! But fear not for the rate of increase is slowing like an Ent after a long nap. Mr. Yun points out that household wealth in residential real estate is reaching new heights a fact that might bring comfort to those who already own a castle… er house. 'Faithless is he that says farewell when the road darkens,' but even the most faithful might reconsider when faced with a mortgage payment higher than the Misty Mountains.

The Contract Cancellations Loom – A Storm is Brewing

Robert Frick a corporate economist darkly warns that 'March numbers are bad but they're likely to get worse.' Contract cancellations are on the rise like wraiths drawn to the Ring. And with rising tariffs and consumer anxiety folks are hunkering down faster than a hobbit in a thunderstorm. Take heed for the winds of economic change are blowing fiercely. As I once said 'I have found it is the small everyday deeds of ordinary folk that keep the darkness at bay. Small acts of kindness and love.' Perhaps a good time to bake some lembas bread and contemplate the future rather than purchasing a new dwelling.