Over the past year, the housing market has been the leading force in turning around the once-depressed national economy, with sales booming from coast to coast and values soaring to pre-recession levels. However, there are signs that the real estate market may be losing steam, as closings in some of the most frenzied locales have gone down sharply over the past couple of months, leaving some analysts puzzled.
In a recent story from Bloomberg Financial News, several prognosticators commented on the fact that areas in California and Nevada – states that were hit hardest by the burst of the housing bubble – are seeing a large number of homes going unsold for longer periods of time than they had been during the same period a year ago.
"Several homes I drive by on my way to work have had for-sale signs up for a couple months, while before, they'd be gone within a week," Mike Imgarten, a 29-year-old civil engineer from Sacramento, California, told the source.
In the past, intense bidding wars have helped fuel the largest gains in property values since 2006 in many metro areas on the West Coast. However, Seattle-based brokerage firm Redfin reported that the inventory of unsold homes in the United States climbed in September from the same period a year ago for the first time since 2011. Although buyer traffic tends to wane going into fall, no one anticipated that as many as 25 percent of all listings would see their prices drop during the month.
What does this mean for real estate investors? While there is currently no sign of significantly waning demand, asset protection seems to be the safest move for individuals looking to shield their retirements from the woes of a complicated and moody housing market.