• Cache Nies

Are We In A Housing Bubble?

Updated: Sep 22, 2021

This is a question I get all of the time. “Is the bubble ready to pop?” This question seems to be dominating a lot of conversations – and everyone has an opinion. Although, when it comes down to it, the opinions that carry the most weight are the ones based on experience and expertise.

Here are four expert opinions from professionals and organizations that have made their careers by giving expert & truthful real estate projections.

The Joint Center for Housing Studies in their The State of the Nation’s Housing 2021report:

“… conditions today are quite different than in the early 2000s, particularly in terms of credit availability. The current climb in house prices instead reflects strong demand amid tight supply, helped along by record-low interest rates.”

Nathaniel Karp, Chief U.S. Economist at BBVA:

“The housing market is in line with fundamentals as interest rates are attractive and incomes are high due to fiscal stimulus, making debt servicing relatively affordable and allowing buyers to qualify for larger mortgages. Underwriting standards are still strong, so there is little risk of a bubble developing.”

Bill McBride of Calculated Risk:

“It’s not clear at all to me that things are going to slow down significantly in the near future. In 2005, I had a strong sense that the hot market would turn and that, when it turned, things would get very ugly. Today, I don’t have that sense at all, because all of the fundamentals are there. Demand will be high for a while, because Millennials need houses. Prices will keep rising for a while, because inventory is so low.”

Mark Fleming, Chief Economist at First American:

Looking back at the bubble years, house prices exceeded house-buying power in 2006 nationally, but today house-buying power is nearly twice as high as the median sale price nationally… Many find it hard to believe, but housing is actually undervalued in most markets and the gap between house-buying power and sale prices indicates there’s room for further house price growth in the months to come.”

Bottom Line

All four strongly believe that we’re not in a bubble and won’t see crashing home values as we did in 2008. And they’re not aloneGoldman Sachs, JP Morgan, Morgan Stanley, and Merrill Lynch share the same opinion.

- Informaruin Sourced from “Keeping Current Matters.”

Give me a call or get in contact to go over the facts. I will show you historical & expected appreciation. I also have a number of tools to help you make the best decision. It goes back to the old saying "it doesn't pay to wait." Every month that you wait to NOT own a home, is a month that your still paying rent. Factor in the amount not going towards principle, along with appreciation, and the numbers are staggering. Don't wait, get in contact, and let's the make the possibility of home ownership, POSSIBLE.

- Cache Nies

- NMLS #1793984

- An Equal Housing Lender

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