2020 Spring Market Report
Sometimes we are our own worst enemy. When things are bad, we wallow and exaggerate that they are so bad and when things are good, we focus only on the fact that they are going to be bad again.
I contend that learning to produce in both bad and good times is really the only answer.
For Spring 2020 the real estate forecast is good and should remain really good for sellers for the next 1 to 2 years. Some economist’s project modest (I think better than modest) growth in home sales and home prices alike. Because low mortgage interest rates are a key factor in driving nationwide demand.
La Crosse Market
In our La Crosse county market 2020 buyers have fewer homes to choose from than they have had in the last 5 to 8 years. There has been a steady decline in inventory on the market since 2017. The lowest single-family house count in 2017, a year and a half ago, was down from peak inventory of 825 to 210 homes listed.
On February 11, 2020 the number of single-family houses listed in La Crosse county is 194 homes. Average days on market is also shrinking to below 30 which means we have a massive shortage of housing.
This is good for all home sellers as it will be a key driving factor in price for at least the next two years and maybe the next five.
As the market tries to catch up, there are very few areas to build in, primarily Holmen, WI which has doubled in size over the last eight years and is looking to double two more times before 2035.
Always A Naysayer
No matter how good the economy is and how good the housing market is you can always find naysayers in the marketplace. So, I will give you the reasons I believe we have a strong housing market especially in La Crosse County for the next 5 to 7 years.
Number one is the Trump presidency has been a blessing to business and thus job creation and individual earnings are on the rise no matter what political rivals are trying to tell you.
There has also been a shortage of new housing starts from 2008 to 2016 as people had very little confidence in the economy because the crash of 2008 created so much extra inventory in the marketplace.
Government Solutions Depressed Demand
What the Obama administration did, by putting their foot on the brakes of financing, just held down demand for a few years causing a market shortage. The best part about investing in the La Crosse, WI market is that no matter what happens there is a two-year delay and the downturn is never as harsh as the East or West coast.
2008 Downturn Effect
The average home value decrease in the 2008 downturn was about 10%, although the days on market increased and inventory was much higher.
Preparation
For investors in the know, preparation for the next crash is the baseline for real wealth creation. We're not only looking for the next downturn, we are preparing to be locked and loaded in the buy position.
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Thanks for reading our blog!
— Joshua Dudgeon