That is the question on everyone’s mind. As more inventory becomes available, we are seeing longer days on market. There are price adjustments in high-end neighborhoods. Of course, all real estate is local.
Depending on price point, your neighborhood may still be experiencing price appreciation. Overall, we are still facing a housing shortage. There is still pent up demand. So what does it all mean? What can you expect?
Consider that Real Estate is Cyclical
Shifts are inevitable. They occur when supply and demand move out of balance. When housing exceeds buyer demand, it is a buyer’s market. When buyer demand exceeds supply, it’s a seller’s market. A shift occurs when the market transitions from one to another.
Several factors can create a shift:
- Global factors such as currency exchange rates.
- The overall political climate.
- National factors such as interest rates and inflation.
- Local factors such as neighborhood dynamics and housing prices.
Ultimately, it all comes down to buyer demand, which in large part is fueled by affordability and perception.
Market Shifts Aren’t Necessarily Bad
For those wishing to trade up, there may be more opportunity to sell an existing property and buy a replacement property. For buyers just entering the market, there will be time to take a breath and a second look before submitting a purchase contract. For sellers, it might mean strategizing to maximize profit via a good marketing plan, proper preparation, and promotion.
The good news is that there is an opportunity in every market. Hawaii will continue to be a sure bet when it comes to Hawaii real estate investment.