When it comes to comparing real estate metrics from one year to another, it can be quite challenging, especially in a normal housing market. The reason behind this challenge lies in the variability of market conditions, which can make such comparisons less meaningful or accurate. Unpredictable events can also significantly impact the circumstances and outcomes being compared.

In recent years, we experienced what we like to call the 'unicorn' years in real estate. These were the years when the COVID-19 pandemic brought about profound changes in the housing market. The desire for a home of our own skyrocketed as people sought more space, home offices, and larger backyards. Consequently, there was a surge in both first-time and second-home buyers entering the market. Additionally, historically low mortgage rates reached unprecedented levels, and government programs, such as forbearance plans, helped mitigate foreclosures. Home values soared to appreciation levels never witnessed before. It was indeed a market that seemed "greatly desired but difficult or impossible to find" - a true 'unicorn' year.

However, as time passes, we find ourselves slowly returning to a more normal state in the real estate market. The 'unicorns' have galloped off, so to speak. Comparing today's market to those exceptional years simply doesn't make sense. Let's explore a few examples to understand why:

1. Buyer Demand:
Despite what the headlines may lead you to believe, there are still plenty of buyers in the market. In fact, the United States continues to witness over 10,000 houses sold each day. While buyer demand has indeed decreased compared to the 'unicorn' years, when we compare it to the more typical years of 2017-2019, we can clearly see that buyer activity remains strong. (See graph below)

2. Home Prices:
Attempting to compare today's home price increases to those of the past couple of years would be misleading. According to Freddie Mac, both 2020 and 2021 experienced historic appreciation numbers. However, recent data indicates that we are returning to more normal home value increases. Although there were a few months of minimal depreciation in the second half of 2022, the market has since regained its footing and returned to more typical appreciation levels in the first quarter of this year. (See graph below)

3. Foreclosures:
You may have come across alarming headlines about the increase in foreclosure filings. However, it's important to keep in mind that these percentages are rising from historically low foreclosure rates. The expiration of the foreclosure moratorium is naturally causing higher numbers compared to the past three years. While any foreclosure is distressing for the affected families, we must put the current figures into perspective. In reality, we are returning to the normal filing levels observed from 2017-2019. (See graph below)

It's crucial to understand that this year's housing market will be accompanied by unsettling headlines. Most of these headlines will result from inappropriate comparisons to the 'unicorn' years. To gain a proper perspective on the current real estate market, it is highly recommended to seek guidance from a qualified real estate professional. They can provide valuable insights and help you interpret the data accurately.

Comparing real estate metrics from different years can be a complex task, particularly in a normal housing market. The exceptional 'unicorn' years, shaped by the COVID-19 pandemic, brought about significant changes in buyer demand, home prices, and foreclosure rates.

However, as we return to more typical market conditions, comparing today's numbers to those 'unicorn' years becomes irrelevant. By seeking guidance from real estate professionals, we can navigate the current market with confidence and make informed decisions based on accurate data.