What is worse in real estate than a market where buyers feel prices are too high and don't raise their bids and sellers think prices are not high enough and are not willing to negotiate? Gridlock markets are possibly the most frustrating for agents.....and the consumer.
In the past few years in numerous areas around the country negatively impacted by the SALT tax deduction limitation, many homeowners were simply unable to sell their large home with high real estate tax bills. The devaluation that happened by this gridlock - mostly in some suburbs - was astounding. It also put lives and planning on hold. New COVID-related demand re-awakened and unlocked these stagnant and de-valuing markets, a combination of new interest in larger homes outside of large cities as well as pricing that had become super-attractive....and much lower than three years before when the valuation decline began. There is one upside to gridlock: With far fewer actions/transactions, no clear pricing trends register. Unfortunately, the few transactions that do happen can often register large price declines and sway averages, something that drives valuation perceptions. This too can create demand. Like all gridlock moments, sooner or later they end too and after a period of gridlock, a wave of activity can be unleashed, mostly via perceived value.
Gridlock is frustrating for everyone: buyers, sellers, and agents. A free-flowing market with a healthy balance between buyer and seller expectations is the best kind, but very rare. So is gridlock good? I don't think so. Holding up people's lives is never a good thing in my humble opinion. Unfortunately, these gridlock markets do and will continue to happen....and then like all markets they too will unlock.
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