By Andrew Bash
It’s hard to imagine focusing on anything other than the Chiefs as we head into this Super Bowl weekend. The Patrick Mahomes-Tom Brady match up will either mark the changing of the guard in the NFL — or a chance for AARP members to celebrate one of their own winning another title ring.
But as a Realtor, the pre-game storyline that’s caught my eye doesn’t have anything to do with what will happen on the field: ticket prices.
The marquee quarterback match up coupled with limited seating due to the pandemic pushed ticket prices for the Big Game to an all time high just several days ago. Then, within the past week, things shifted without warning. Tickets as of Thursday had dropped more than 25%. Funny how life works.
It reminds me of housing in Kansas City in 2008. The housing market shifted drastically over a 60 day period. I had 11 listings at the time. I called every listing and asked them to drop to the lowest price they could stomach. Six of those homes did what I suggested and went under contract. The other homeowners stayed the course and were on the market for another six to eight months and sold for prices we thought unimaginable.
Fast forward to today, and we’ve got housing market pricing here that could be compared to ticket prices for the last Super Bowl ever. What gives?
How long will the local bull market last?
A number of factors are at play: Limited inventory at a time when demand is getting higher and higher, low interest rates that increase purchasing power, and transplants relocating from larger, more expensive cities.
The soaring market started in late January and doesn’t show any signs of slowing down. It’s not uncommon to have five to ten offers on some properties. The question is will the shortage of inventory cause the trend to continue or will our housing market drop overnight like 2008?
From a historical perspective, we are long over due for a correction. Most bull cycles in the housing market run between eight to nine years. We are in year 10 or 11 depending on who you ask. Economists who predicted the previous fall around 2007, including Robert Schiller, Fred Foldvary and Fred Harrison, have predicted another occurring around 2024. Some debate remains around the severity of the fall, which is usually determined by other factors.
What is different between now and 2008? Many of the agents thought the start of the lockdown back in March 2020 would lead to a total meltdown of the housing market. It took about eight days to realize the opposite was happening. There are very few homes to purchase currently because people are not selling — in fact, they’re investing to make their homes nicer. Meanwhile, out-of-town buyers are willing to pay more than what the locals have come to expect. As a result, construction and real estate have been on a tear.
So what does this mean for the near future? My personal belief is we will not have a huge drop in pricing like past cycles. Primarily due to KC natives and others moving back to KC from elsewhere. Kansas City is no longer a secret gem. City leaders have made good efforts to create a place to live, work, move your business, start a business and enjoy an easy lifestyle. Additionally, the national attention KC has received as a result of the Royals and the Chiefs is a real thing. People look at our city differently than seven years ago — which means more interest in living here, and more demand for houses.
But, even with everything KC has going for it, it’s hard to predict how long this boom will last. The fact is, consumers are weird and not always as easy understand as one would think.
Think about those Super Bowl ticket prices. There are fewer available seats than any other time in the history of the game. The match up and the backstory should result in ticket prices that keep going up and up. But as we’ve seen the past week, that’s just the case.
The moral of the story is that no one knows what is going to happen. Your home and the value you get for it are of crucial importance in the plans you make for the future. Don’t wait to call a Bash & Co. Sotheby’s International Realty agent to get a full understanding of what your “ticket” is worth in the secondary market.
Bash & Co. Sotheby’s International Realty is an innovative full-service residential real estate brokerage that leverages the latest technology to serve clients in emerging, established, and luxury neighborhoods across the Kansas City area. Follow them on Instagram here and on Facebook here.