Real estate investors are done waiting for rates to drop, executive says
“Real estate investors are starting to accept the reality of the new housing market,” Meyer told Mortgage Professional America. “For a long time post-2022, it felt like investors and homeowners were just waiting for things to go back to the way they were, where mortgage rates would drop, and things would be cheaper, more affordable. And that hasn’t happened, nor do I think it’s going to happen.
“I think people are just starting to accept that and are starting to get back in and start to participate in the housing market, but with more reasonable expectations about what the housing market can offer these days.”
‘The great stall’
The market is seeing forces pulling in opposite directions. On the one hand, investors don’t see things getting better anytime soon. However, deals are progressing anyway. Meyer has a name for this trend.
“I have called this period we’re in, and I think we’ll be in for a while, the great stall,” he said. “Nothing has really changed fundamentally in the last year. People are expecting things to stay the same. So it’s not necessarily negative in terms of, ‘Oh, real estate investing is bad,’ or, ‘I don’t want to participate.’ They’re just not expecting a lot of change.”
BiggerPockets’ latest survey data supports that framing. The company’s Q3 Pulse Index fell to 96 points, its third consecutive quarterly decline from 108 in Q1 and 102 in Q2, with the share of investors anticipating improvement in the next 12 months dropping to 19%, down from 35% last quarter, while 55% now expect conditions to stay roughly the same.
