 Okay guys, what is going on with home prices right now? We're in the middle of a once in a century pandemic. The economy is shrinking, businesses are closing, jobs are disappearing, but in the healthy market, prices just keep going up. And Fannie Mae came out and said that medium home prices are gonna be up from $272,000 last April to $275,000 this April. What's up everybody? Ricky Caruth here. Welcome back to my channel. So this is what I wanna dive into in today's video. I wanna give you two reasons of why I think that prices are increasing right now. And I also wanna give you my personal forecast for home prices in 2020. If you're new to my channel, I hope you find tons of value in this video and other videos of mine. As you'll learn, I'm just here to help you. I'm not here to try to sell you a course or sell you anything whatsoever. Everything I do is absolutely free. I just wanna see you guys succeed. If you're a real estate agent, I'll have a second YouTube channel specifically for real estate agents. I'll link that below. I'm gonna do some live cold calls here coming really soon. And if you wanna join my real estate coaching group, that's at zero to diamond.com, all free 90 day action plan, full course, scripts, videos, tutorials, the whole nine yards and full access to me. So as I look at the housing market so far this year, I gotta say that it has been very, very interesting and really kind of fun to follow and watch. But what I'm really interested in are those April numbers. Those April and May numbers. I wanna see, we know what March was and March was kind of a mixed month because the pandemic didn't happen until really mid to late March. So you have some numbers in there that we kind of see a little bit of the effects in March, but April is where we're really gonna see the meat of the pandemic and what it did to the housing market, to the immediate short-term housing market. And then May is gonna be really interesting. But the National Association of Realtors, they come out with different news releases. And May 21st, they're gonna come out with their April existing home sales. May 28th, they're gonna come out with their April pending home sales. And I'm really interested to see that data. That's really gonna tell me a lot about where the housing market is, where it's been and where it's heading. And then I'm also gonna be even further interested June 22nd and June 29th when they come out with the May numbers. That's really gonna tell us a tell there because I'm sure April is gonna be one of our worst months. That was probably the scariest moment of the pandemic and the height of the shutdowns. Unless we get shut back down again, if we see a second wave of the virus and they re-shut us down, you see that's kind of the unknown. We really don't know what is gonna happen in the future. No one can predict any of this. That's why we see all these different models of how many new cases of the virus we're gonna get and how many deaths. And we see those models go up and down and sideways and back and forth. It's gonna be the same thing with trying to predict the housing market or trying to predict the stock market. No one knows exactly what the effects of this is gonna be short or even long-term. It's gonna, a lot of people are saying it's gonna take years and years to recover and get back where we were. So there's a lot of questions. So a lot of this predicting and trying to figure out what's gonna happen. You know, I mean, it really doesn't mean much at this point because there is no way to tell what's gonna happen. But I can tell you one thing. Real estate is nowhere near dead and it's not gonna die. It's not gonna go to zero. Prices aren't gonna go to zero. Transactions aren't gonna go to zero. There are always gonna be closings happening every single day. That number may fluctuate, but it is always gonna be very strong and there's always gonna be more business out there than any of us can handle ever in our lifetime. You can stay busy 24-7, right? 365 and never even scratch the surface for how many people are out there that you could actually work with and help buy and sell a piece of property. That's why I feel like we're in one of the most secure industries out there as a real estate agent. And I just absolutely love this business. So let's get into the Las Vegas numbers here. Las Vegas home prices are up in April, but sales sag amid pandemic. So it looks like the medium sales price of previously owned single family homes, which is the bulk of the market there in Vegas, was 310,000 in April. That was up 3.3% from the same month last year. So look at this. This is interesting. There was a total of 1971 transactions. Okay, that's down 31% from last April. Okay, so transactions are down and sellers put 2,516 houses up for sale. That is down 41%. That is massive. That is a massive number for people not to put their properties on the market. And that's one thing that's really, I think, driving the market here. Now, let's look at canceled deals. Okay, in March of 2020, compared to March of 2019, okay, the number of canceled deals doubled. Okay, so March, of course, was the first month that we learned about the pandemic, or at least that we kind of started taking action and went into a shutdown mode and really kind of, you know, a lot of people got scared, so they canceled their deals. So that was up nearly double. But if you look at April, there were less people that canceled their contracts, right? It was down 11% from last April. So what we're seeing is, is that people that put contracts in after the pandemic scare, they're not canceling, okay? They came into this contract knowing about the pandemic. So obviously they are okay with it because they wrote a contract after the shutdowns. So every market's different. You're not gonna see the same stats in every market. Some are gonna be up, some are gonna be down. So these are just averages we're talking about here. But the first reason why I think that prices are up in a lot of markets is probably the obvious reason, and that is inventory. Inventory, guys, is at an all-time low right now. It was already incredibly low. And then the pandemic comes in and even less sellers put their homes on the market. And there's even a huge uptick in people who were listed that took their house off the market because they were scared about people walking through their home or so on and so forth. So we're in a really serious supply situation right now. So according to the National Association of Realtors, there was 1.5 million units for sale at the end of March. That's down 10% from a year earlier. And we were already down last year. So you gotta realize that there's a huge, huge supply and demand issue. And there's still a lot of demand. If you look at the Pending Sales Index that NAR came out with for March, it was only down 20%. And keep in mind, that was the month we started the shutdowns and everybody got scared. So that's not gonna really tell us the true numbers. That's why I'm really interested in that April Pending Sales Index. But when I look at my market and when I talk to other agents around the country and I see how many deals that they're doing right now and how much they have under contract and everything going on as a whole, I'm thinking that demand is still incredibly strong right now, even with everything going on. And we only have record lows in terms of inventory. That just tells me that that is a huge reason why prices are not dropping as much as one would think. Redfin also came out and said their total home listings have hit a five-year low. So although demand may not be as strong as it was, it's still incredibly stronger than the supply that we have. Now, let me give you the second reason why I think that prices are holding steady and even increasing in some areas and some markets. And that is this. Sellers just absolutely do not want to sell it for any cheaper than what they've been going for. I think that a lot of sellers are sitting here and they're saying to themselves, this is gonna pass. Okay, no one knows, but why would they just start cutting their prices at this point? We're pretty early in the game. This is something that could end quickly. They're already opening up businesses in other countries. And so we're in this mindset that, there's kind of two paths here where one of the paths that we think that this could go down is that we recover really quickly. And so I think a lot of sellers are thinking, hey, I might as well hang in there a month or two and see how this pans out. If you look at sellers that cut their prices, they reduced their prices. There was only about 4% of properties on the market that the sellers reduced the prices in the week ending April 25th. That's down 5.7% during the same week last year. So you got less sellers reducing their prices now than they did the same time last year. And I'm telling you, it's because sellers are thinking, hey, right now buyers, they don't wanna get out of their house, they don't wanna go see other people and be around other people and look at properties. So sellers are just hanging in there tough. They believe their houses aren't selling because buyers haven't wanted to get out and try to look at properties and they're reluctant to make offers. A lot of buyers are sitting around on the flip side. A lot of buyers are sitting around thinking, hey, if I just wait a little bit, prices have to come down because of this situation. And so it's kind of a tug and pull there. It's kind of one of those old face offs. They're just staring at each other and they don't know who's gonna move first. And I think that's where you lose that 20, 30% or 40% of people who aren't making offers this year that were making offers last year. Okay, so you still got a good 50, 60%, I believe. We'll see when the April numbers come out for pending sales. I think you still got a good 50, 60%, maybe even more that are actually moving forward and writing offers to close on properties. But the rest of those buyers that are actually sitting tight, they're sitting there thinking, hey, there's gotta be some deals coming soon out of this. Now, where does the market go from here? Okay, where are prices gonna end up over the next couple of months or even by the end of the year or even going into 2021 and by the end of 2021? There's a housing data provider named CoreLogic. They came out with nationwide home prices to rise one half of 1% between March of 2020 and March of 2021. Okay, they've got prices declining in some cities, including Houston, Miami and Las Vegas, but they've got overall the averages for the country going up about one half of 1%. So they're not calling for a huge increase there, really just flat. The National Association Chief Economist, Lawrence Young, is calling for a 1.3% increase. Okay, he says over the next 12 months, it's hard to anticipate price declines because of the mortgage forbearance in place. You would have to see continuing job losses for a prolonged period leading to foreclosures and even then we may not have an oversupply. So he's under the assumption that inventory is so, so low that even if we did run into a situation where we have lots of foreclosures and people losing their homes and if it gets really bad, he's even questioning at that point if we would have an oversupply. We're gonna have to have an oversupply compared to the buyers and the demand that's available before we see prices decline. And that very well could happen. And guys, you just never know, there's nearly 4 million homeowners that are not paying their mortgages right now. That is some scary stuff. That is a big number. Now you do have Zillow, Zillow forecasting that prices would fall 3 to 4% in 2020 with no recovery until the end of 2021. So Zillow thinks that prices are gonna decline about 3 or 4% and that we're not gonna get back until the end of 2021. They're saying that it'll drop, the drop will peak out early 2021 at around 4% and then the values will kind of flatten out for the rest of that year. They also predict a very fast 50 to 60% decline in transactions, okay, which would bottom by the end of this spring and recover at a pace of about 10% each month through 2021. So if you look at what Zillow thinks, that prices are gonna drop about 4% between now and about a year from now, okay, number of transactions will drop 50 to 60%. And then in 2021, we'll just kind of slowly increase a little bit, prices kind of stay flat, they're saying and number of transactions up about 10% each month as we kind of move out of this market cycle. Now all these projections are nothing compared to the great recession back in 2008. You know, back then home prices peaked out in 2006, okay, they dropped between 2006 and 2012 by 27%. So it was a six year decline for real estate prices which resulted in about a 27%, that's nationally, okay, there were other markets that dropped a lot more than 27% including my market. And from 2012, which was the very bottom for real estate prices to our recent highs, we're up about 60%. So the last crash was a huge swing, okay, and it was very long, okay, it was a six year decline, okay, and we've been on a bull run ever since. So when you compare this to that, you know, when you're looking at these projections and what people think are gonna happen and all this, it's really nowhere near what the last one was. Guys, I went through the last one, I'm here to tell you, I had to go back and roof houses for a while, I went and worked on an oil rig for a little bit. I actually got back in the market in 2008 and the market was at, it was really, really low. That was probably, 2007 I think was our lowest year in terms of transactions and it was tough. I mean, it really was, but once you realize that it's about people and not the transactions and you get out there and you start learning, you know, how to talk to people and how to figure out what you can do to help people short and long term and you start to build your database and build your business the right way, all the pieces of the puzzle start to come into place. I started selling foreclosures to buyers and then a couple years later, when those properties increased in price, they would sell that property and buy another property and refer 10 people to me over the last five or 10 years, so I'm here to tell you that that in the midst of whatever happens, because no one knows what's gonna happen, but in the midst of whatever it is that happens, I want you to know that closings are gonna continue to happen every single day and they're gonna continue to be very, very strong in terms of what you can handle. You could do the same number of transactions moving forward over the next year or two as you were doing before all this happened and that's if you have the right mindset, focus and work ethic, so what do I think is gonna happen to home prices for the rest of the year and how we're gonna end up at the end of the year? I'm gonna have to go with the National Association of Real Tours Chief Economist Lawrence Young with 1.3% increase by the end of the year. I think that the inventory has gotten so incredibly low and I think demand is gonna continue to be strong that I just believe that we're gonna be right there, but if you'll notice, just about all the projections are basically flat. When you're talking about 1%, are you talking about 3% or 4% decrease? You're talking about a half a percent increase over the next year. Those are all extremely flat numbers and all of those are indicating that we're gonna be kind of on the increase after that, so this is gonna be a very extremely light real estate downturn, if you will, if you ever wanna call it that. I mean, I guess you could say it's a pretty incredible downturn in terms of transactions. We're gonna have a lot less transactions when we look back. I was looking at my market in particular today at our April numbers and the number of transactions were down considerably, so I'm really looking forward to that information coming out about April from the National Association of Real Tours. I'm really looking forward to seeing how May shakes out in terms of my particular market here Gulf Shores, Orange Beach, Alabama, as well as the rest of the country. I hope you guys enjoyed the video and got a lot of value out of it. Please click that like button. Hit the subscribe if you haven't already. Go visit my second channel and reach out and let me know what in the world I could do for you. I just wanna help you guys succeed at the highest levels possible and definitely leave me a comment. I love reading all you guys' comments, so I'll see you guys on the next video. Let's go. I'm bored thinking, need a life for the ideas. I'm in the splash zone with the brainwaves. I shoot for stars up in Miami Street. I lay in the same line in the...