As a kid, I’d always get a little annoyed when people would start asking my dad, a doctor, for medical advice at social gatherings.
“Hey Phil, I’ve been having this pain in my stomach …” the question might start.
Although he would patiently answer any questions, I was always thinking: make an appointment and go see him at his office. How can he tell what’s wrong without doing an examination?
I came to realize that was just a professional hazard for a doctor. Every profession has them. Investment brokers get asked for stock tips. Attorneys get solicited for free legal advice. Interior designers get asked for decorating tips — and on and on.
I find the same to be true for real estate agents.
The questions are usually, “Is this a good time to sell/buy a house?” “How’s the market?” or “I read in the newspaper that the housing market is doing well — what do you think?”
I’m more than willing to answer these kinds of questions. In fact, I find it a bit flattering and even reassuring that they respect my opinion enough to ask.
But the questions that always stump me are the ones where people ask me to predict the future.
“Should I wait until May to sell my house?” or “What’s the market going to be like in June?”
How should I know? I always want to say something like, “Do you want to move in May?” or “You tell me what the world is going to be like in June, then maybe I can answer your question.”
How does one respond to these queries? I’m not a soothsayer. I can’t read tea leaves. I don’t know how to look into a crystal ball. I don’t know what’s going to happen in the future any more than the next person.
I can only make predictions based on the current scene and past situations. But that’s about it; anything in the future would be pure conjecture.
There are so many factors that go into the future of a housing market: local employment rate, wage growth, credit availability, world economic conditions, oil prices and even national elections. Just look at how many so-called “experts” missed the inevitability of the financial meltdown in 2008.
So how does one predict the future?
In my opinion, there are three things to consider that might help one figure out the future likelihood of a healthy real estate market:
- Jobs: How robust is the local job market? What’s the unemployment level? Are we gaining or losing jobs in our town/county/state? Where do the jobs stand with respect to wage growth?
- Inventory: Does the current inventory match the current demand? How quickly are we absorbing new inventory?
- Finance: Can buyers get financing? How available is credit?
Answering those questions can sort of help predict the future, but the future remains a mystery. Things happen that we can neither control nor predict.
The next time someone asks me to predict the future of the housing market, maybe I’ll bring out some tarot cards.
Ann Jones has been a respected Realtor on the North Shore of Chicago for nearly 15 years. Her primary market is the Lake Forest/Lake Bluff area but serves clients along the shore as well. Follow her blog at anns-blog.com or on Pinterest.