Are we in a housing bubble?
If you've been paying even a slight bit of attention to the housing market, you know we're experience some pretty unbelievable conditions.
On top of an eventful year last year, there's been surges of demand with not enough inventory to meet it, not to mention financial fluctuations like rates.
You and other people may be thinking that we're headed for a housing bubble right out of 2008. We’re not, and here’s why!
According to Lawrence Yun, chief economist of the National Association of Realtors: "This is not a bubble. It is simply a lack of supply."
He goes on to say, "Remember, housing inventories are low, credit remains tight, and lenders are much more selective and regulated in regards to loans, not like 2008."
Also, the housing market has a record-low record of homes for sale. If you want to compare that to either year, according to their stats, at the end of March 2021, there were 1.07 million homes available for sale.
In July 2007, there were more than four times that—4 million homes for sale!
A much more regulated and healthier environment means this is not a repeat of what happened last time. We're just waiting for more sellers to come to the market, which, again, according to the National Association of Realtors, is improving.
They also said that housing starts rose to 1.7 million in March, and housing permits are averaging at 1.8 million in the first quarter of 2021. They go on to say that "Sellers that have been hesitant to list homes as part of their personal health and safety precautions may be more encouraged to list and sell their homes with a population mostly vaccinated by the end of this year".
Let's get you home. Call us if you have any questions about the housing market, and let's talk about how we can get you home.
Sources: https://magazine.realtor/daily-news/2021/05/06/this-isn-t-a-bubble and https://www.nar.realtor/blogs/economists-outlook/how-are-buyers-coping-in-a-highly-competitive-housing-market
