Buyers and sellers across Arizona and the country are panicking! They all think the market is going to crash, so they’re waiting to buy. Is there reason to panic?
JEFF: Hi I’m Jeff Sibbach and I’m here with a Top Performer on the Sibbach Team Kimberly Childs. What’s going on?
KIMBERLY: Oh my goodness, Jeff. My clients are panicking! They all think the market is going to crash, so they’re waiting to buy.
J: Buyers and sellers are panicking? This is crazy! Well, I got three reasons why I don’t know that they’re gonna be right.
#1 People have nowhere to go, sellers are sitting on low mortgages, how are you going to get more supply? You think that those people with those low mortgages are they’re going to choose to go to twice the expense to go to a rental? I just don’t think that sellers are gonna make that choice. I mean why would your renter choose to lock in a loss?
K: They’re okay with losing 30k instead of building equity.
J: Wow, okay well.
#2 Sellers pockets are full. I mean what if, because we don’t know, it’s the future, it’s a prediction. What if the media talking heads are actually wrong because sellers are sitting on more equity than ever before. This wasn’t the way it was last time, last time it was no money down, now people have $207,000 of equity, over 20 percent…
PHIL: Well hold on, what is he saying right there? Let’s take a look. Let’s say you bought a $500,000 house and you put 20% down or a hundred thousand dollars. You have a $400,000 loan on the property. So if you were to sell this house for $500,000 you would have to pay off that loan and then you would be left with roughly $100,000, but what has happened in the market is home values have gone up on average above the 20 percent that people put down it’s $207,000 which means that this property now is worth $707,000. So if I were to sell it, I still have to pay off that same four hundred thousand dollar loan, but now I’m left with $307,000 in my pocket. Now let’s get back to the video!
…in their house, OMG!
K: OMG so many people are looking at the news, they’re reading their newspaper and they’re not believing us, the experts.
J: You’re saying that people believe the internet Kimberly.
K: Yeah, who would have thunk it? They believe the internet, they go online and they go to r.com and they see that their home value is at $350,000 and then they go to z.com and they see that the value is saying $550,000 and then they go to a.com and it’s at $750,000.
J: So that must make them, they know all that information all of a sudden, Kimberly. Sounds like they think that they’re the experts.
All right well I want to give them #3. So America has been repriced, I mean maybe the people should be checking out the Saint Louis Fed Chart where there’s been 16 trillion dollars injected into the economy and they haven’t said that they’re gonna pull it out any bit faster than they put it in. It’s crazy, what are we gonna do with all this cash, Kimberly?
K: Hey they’re hanging on to it, I’ve got so many clients just holding on to their cash waiting for this market to crash.
J: Kimberly, typically the masses are the asses because it sounds like everybody thinks that the market’s going to crash, what do you think is going to happen?
K: Well, hey you know what they say when everybody’s sitting on cash, she ain’t gonna crash.