Every week, we ask a real estate professional for thoughts on the top trends in real estate.
This week, we talked with Sissy Lappin, owner of Lappin properties and co-founder of Listingdoor.com.
Houston Agent (HA): What makes Houston a great market to buy in right now?
Sissy Lappin (SL): I think it’s a great time to buy in Houston. I’ve been doing this for 32 years. This will be my third recession and it’s all very predictable. The market is such that you don’t have to make a snap decision. Prices have come down thanks to the dip in the market and they’ve stabilized. It has a similar feel to 2008-2009, where we saw not only oil prices drop, but a full global recession. The people that bought then look like the smartest people in real estate.
HA: What do you think lead to that dip in the market?
SL: To be honest, it more feels like we got a little bit crazy in 2014. It feels more like we’ve normalized. It was the go-go days, as I like to call it. We’re now seeing a market where there’s virtually no new building. Focus now is on finishing current projects. Over the next 12 to 24 months, the current inventory is going to be snatched up and then there’s not going to be anything new coming online, which will cause another increase of values.
Oil prices are a part of that, too. Oil prices are like weight. When you take off weight, you have to do it gradually, but then when you put it back on, it comes back all at once. It’s the same thing with oil prices. They don’t rise a dollar here, a dollar there. They come back with a vengeance. Oil prices went from 30 dollars a barrel to 42 dollars in 30 days. That’s a 30 percent increase in a very short timespan.
HA: Where do you see the market going from here?
SL: I think the market is going to recover extremely well. The reason for that is knowledge. Buyers are extremely knowledgeable and have access to all the same information as agents. Three years ago, comparable sales and active homes for sale were guarded like how Coca-Cola guards their top secret formula. Zillow and other sites have changed all of that. Buyers and sellers have much better access to information about the state of the market. Information spreads fast. When prices drop, buyers see the dip and know it is a great time to buy. More homes over 4 million dollars sold in 2015 than in 2014. We can all learn from this. Real estate 101 is “When the news is the best, sell it; when the news is the worst, buy it.” It is so simple to make money in Houston real estate and it is the only city where that the pattern is so clear: When oil drops below $40/barrel buy a house, when it goes above $80-$90/barrel – sell that house.
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