The Truth About Today’s Biggest Housing Market Myths
Have you ever heard the saying, 'Don’t believe everything you hear'? This advice is particularly crucial if you're considering buying or selling a home in today’s housing market. Misinformation is everywhere, and now more than ever, having a trusted source of accurate information is essential.
Partnering with a knowledgeable real estate agent can help clear up common misconceptions and provide peace of mind, backed by research-driven facts. Here are a few myths that your agent can help debunk.
Myth 1: 'I’ll Get a Better Deal Once Home Prices Crash
If you've heard that home prices are set to crash, it's important to look at the real data. While prices can vary by local market, the majority of evidence shows that a significant crash is unlikely. Unlike in 2008, when an oversupply of homes led to plummeting prices, today's market is defined by an undersupply of homes for sale. This difference makes the current housing market a completely different scenario (see chart below):
So, if you’re waiting for a market crash to score a deal, the data suggests otherwise. There’s no significant drop in home prices on the horizon, and waiting could mean missing out on opportunities rather than securing a better deal.
Myth 2: 'I Won’t Be Able To Find Anything To Buy
If the fear of not finding the right home is holding you back, it might be time to consult with an expert real estate agent. Over the past year, the supply of homes for sale has actually increased. According to data from Realtor.com, while inventory is still lower than in a typical year like 2019, it’s higher than it was at this time last year (see graph below):
If you’re recalling the media coverage about record-low supply during the pandemic, it’s time to update your perspective. While the market isn’t fully back to normal, inventory is trending in a healthier direction. As more options become available, you can confidently let go of this outdated myth—finding a home to buy is becoming more feasible.
Myth 3: 'I Have To Wait Until I Have Enough for a 20% Down Payment
Many people still believe that you need a 20% down payment to buy a home. This myth is so widespread that Fannie Mae reports:
‘Approximately 90% of consumers overstate or don’t know the minimum required down payment for a typical mortgage.’
Data from the National Association of Realtors (NAR) further debunks this misconception, showing that the typical homeowner isn’t putting down nearly as much as you might expect (see graph below):
First-time homebuyers are typically putting down just 6%—far less than the 20% many believe is required. If you're looking at the graph and noticing that repeat buyers are closer to 20%, remember this: they’re often using the equity from their current home to make a larger down payment on their next property.
This highlights that a 20% down payment isn’t necessary unless specified by your loan type or lender. In fact, many buyers put down much less. Depending on the type of home loan you choose, you might only need 3.5% or even 0% down. So, if you’re buying your first home, the down payment you need is likely much lower than you think.
Bottom Line:
If you’ve put your move on hold because of one or more of these myths, it’s time to talk to a trusted real estate agent. An expert agent has the data and facts to reassure you and help clear up any misconceptions that might be holding you back. If you have questions about what you’re hearing or reading, let’s connect. You deserve to have someone you can trust to provide the facts.