Whispers of a Shifting Housing Market

By Ryan Dosen

 

It always starts small.

“The reality, I believe, is that all change starts small. The big picture is just too unwieldy, too incomprehensible and seemingly immovable. But give us something individual, quantifiable and personalize-able and, suddenly, our perspective shifts to the one.”

The words of Mick Ebeling, a well-known entrepreneur and TED speaker, probably centered on the founding principles of his Not Impossible Foundation—an organization that develops creative solutions to help overcome difficult or seemingly-impossible real world problems.

Ebeling’s words were not directed at the real world problem of the well-deserved general fear of buying real estate in the wake of the Great Recession and market collapse of the 2000s. Indeed, after the collapse, most of us looked back with 20/20 hindsight, shaking our heads at the foolish practices of “no-doc” lending, borrowing with negative amortization schedules, and even camping out to buy homes sight unseen.

Those days were like the Wild West. Boy, oh boy. Crazy times, I tell you. We’ll be telling our kids, and they’ll be telling their kids about those days for years to come. We’ll never see anything like that again in our lifetimes…. Right?

Starting Again, With a Whisper

News of it has barely risen to the level of a whisper, but just a few short years after the market collapse of the 2000s, we are already starting to see signs of the seemingly incomprehensible. The National Association of Realtors reported this week that home buyers are camping out again to buy new homes, particularly in Sun Belt areas like Phoenix and Las Vegas.

In January, more than 250 people camped out for a chance to buy a home in a development called Victory at Verrado in metro Phoenix. Last month, more than a dozen eager buyers camped out for days so that they could be the first to buy 30 new homes in Mulberry of Mesa, AZ. In December, people camped out to have a chance to reserve a unit at Minto Communities’ Villas By The Sea condominium in Lauderdale-by-the-Sea, FL. In California, builder O’Brien Homes recently was holding monthly lotteries to decide which ravenous buyers would have the chance to throw their money at a new 228-unit development named Fusion.

Random Occurrences or Harbingers of a Market Shift

Yes, these whispers of sizzling markets are coming from some of the usual suspect areas: South Florida, California, and Arizona. Many will brush aside these whispers because of the typically combustible markets from where they are originating. And maybe they’re right. These outliers certainly do not have to become the norm.

For many, learning that people are once again frothing at the mouth for real estate like the latest iPhone will evoke feelings of disbelief or anger. Didn’t they learn their lesson the last time? It hasn’t even been 10 years! It can’t be happening again. It’s incomprehensible. And yet, we have individual examples.

Quantifiable Instances of Ostensibly Incomprehensible Behavior

The immovable collective mindset is moving. And not without reason or without the epic efforts of our government and the Federal Reserve. For better or for worse, years of government-backed policies and programs have kept interest rates down long enough for the economy to recover to a point where people can finally face their fears and start making moves en masse.

It always starts small. And small, this trend toward frenzied home buying most certainly is. Small, it may also stay. Or it may not. We’re not expecting to see 2005 again. That said, I’ll offer one last individual instance that hits closer to home.

We have three clients that missed out on getting into Megill Homes’ latest development at Hawks’ Crest in Chadds Ford by a matter of days. Those clients are not outside camping right now. But whispering about getting a spot reserved at the next development, they most certainly are.

 

This article was published by 21st Century Media and the Daily Local News (West Chester, PA). To read this article on the the newspaper’s site, please visit the Daily Local News.

 

 

To view all of Ryan Dosen’s 21st Century Media real estate columns, visit http://www.dailylocal.com/search?text=dosen.