Our headline is the question? many people are asking. Well, bursting the real estate bubble in Sacramento Housing Market mostly depends on whether the appreciation in the market is real or manufactured. With the government backing so many loans at 3.5% down, so many home buyers are instantly upside down in their home after they buy it, as it takes about 8-10% to sell it.
Even with unemployment going down, I wonder how many of these new jobs are substantial… solid jobs – ones where people are making a good living and able to buy or invest with confidence. Following are some points to think about:
- The market will keep going up as long as there is demand, and I know with my list of buyers, there is HUGE demand. And, it will keep going up as long as there is a perception of health in our economy – that seems what everyone wants to feel, even if it’s just a perceived reality. How long will it last? Or, at what price are these home unattractive to both investors and buyers?
- Especially for investing… proceed with caution. People will only invest if they know that they can get out safely within 6 months.
It’s interesting that the seasoned investors say – they are unsure and don’t know, especially when the wisdom of the day is to make certain proclamations like, “We got 2 years of appreciation!” or “Once the unemployment rate falls to ____, then interest rates will go up.” Some of these statements have truth embedded, but beware of those who “knows for sure.”