The Riddle of the “Missing Middle” is Key to Understanding What Lies Ahead…

Hans Wydler

The Riddle of the “Missing Middle” is Key to Understanding What Lies Ahead…

 

There are so many questions right now about what lies ahead for real estate. As predicted, rising interest rates have taken some of the froth out of the market, but by any normal comparison, it remains a strong sellers' market and we don’t expect prices to come down anytime soon. But why? 

 

The main reason we think housing will retain its value (if not continue to appreciate) is that inventory continues to be low, and the majority of new homes being built doesn’t necessarily match the demand. In particular, there is a shortage of close-in entry and mid level housing – “the missing middle”. These homes include townhomes, duplexes, cottage housing, and smaller single-family homes. Ironically, while first time home buyers are scouring our market for these kinds of homes, they often find themselves competing with builders/developers looking to "tear down" as well as empty nesters and down-sizers who are looking for the same kind of properties.

 

This article does a nice job summarizing the complex reasons behind the shortage & mismatch, but suffice it to say that it will take years for supply (particularly the right kind of supply) to catch up, and until then, your home should be a pretty darn good investment. Regardless of your prediction of what will happen to our local real estate market in the weeks/months/years ahead, we believe that the timing of purchase and/or sell decision should be more about your personal situation than about timing the market. As we like to say, "life should dictate the house decisions and not vice versa."  


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Wydler Brothers have been selling residential real estate for over 20 years in the DC metro area. They rapidly ascended the local landscape and built the highest producing team in the entire region, recently named #28 in the US, Top 2 in the DMV and #1 in Virginia Large Team by Volume by Real Trends Magazine "The Thousand" in 2021.

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