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

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. Let’s connect so you have an expert on your side to help you keep everything in proper perspective.

22 Properties
Page 1 of 2
$740,000
Neighborhood: Whispering Hills
4
Beds
2F11/2
Baths
3,288
Sq.Ft.
1987
Year Built
2
Days on Site
20240041826
MLS
$45,000
Neighborhood: Kaiser Gardens
2
Beds
1
Baths
652
Sq.Ft.
1938
Year Built
4
Days on Site
20240041664
MLS
$115,000
Neighborhood: Sawyers Keego Harbor Sub
0.18
Acres
4
Days on Site
20240041864
MLS
$280,000
Neighborhood: Grenal # 01
3
Beds
1F11/2
Baths
1,075
Sq.Ft.
1965
Year Built
5
Days on Site
20240041205
MLS
$229,900
Neighborhood: Scotts Addition
3
Beds
2
Baths
1,380
Sq.Ft.
1950
Year Built
7
Days on Site
20240039338
MLS
$309,900
Neighborhood: Ingleside Farms Sub
3
Beds
2
Baths
1,800
Sq.Ft.
1953
Year Built
7
Days on Site
58050144881
MLS
$229,900
Neighborhood: Plum Hollow Estates No 1
3
Beds
1
Baths
1,116
Sq.Ft.
1964
Year Built
8
Days on Site
20240040314
MLS
$330,000
Neighborhood: Coachwood Square # 03
3
Beds
2F11/2
Baths
1,484
Sq.Ft.
1990
Year Built
12
Days on Site
20240039141
MLS
2
Beds
1F11/2
Baths
1,550
Sq.Ft.
14
Days on Site
81024027766
MLS
$325,000
Neighborhood: Warren Park Sub
3
Beds
2
Baths
1,474
Sq.Ft.
1989
Year Built
18
Days on Site
58050143756
MLS
4
Beds
3F11/2
Baths
2,108
Sq.Ft.
1999
Year Built
19
Days on Site
20240036267
MLS
$275,000
Neighborhood: Moulin Rouge Sub No 2
3
Beds
1F11/2
Baths
1,191
Sq.Ft.
1958
Year Built
20
Days on Site
20240036323
MLS

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