Dave Ramsey Offers Reassuring Updates for Individuals Concerned About the Real Estate Market
Dave Ramsey's track record of predictions has had its ups and downs, but his assessment of the housing market from last year appears to be fairly accurate, at least for now. During his show "Ramsey Real Estate Reality Check" in July 2022, he confidently stated that he did not foresee a market crash similar to the one in 2008. Ramsey attributed this prediction to the current data, which indicates a different market scenario.
Using the fundamental economic principle of supply and demand, Ramsey explained that the abundance of eager buyers and limited housing supply would prevent a significant price crash. He compared housing inventory data from 2007 to 2022, highlighting that the available supply last year was only a fraction of what it was in 2007. Despite the increased interest in buying homes during the pandemic, Ramsey emphasized the persistent high demand, especially from the population of "prime home buyers" in their mid-30s.
Ramsey's prediction aligns with the current median home prices in the market. While there was a modest 10% decline from June 2022 to January 2023, the numbers have rebounded, showing a 1% year-on-year increase in the first five months of 2023, according to Realtor.com. This outcome reflects the absence of the anticipated housing crash many feared.
However, Ramsey acknowledged that market conditions could still change, and he encouraged viewers to assess the information independently, considering his own past mistakes.
Source: The Street