Is Another Housing Bubble Coming?
With the rapid increase of average home prices across the nation in recent months, it’s easy to wonder if we’re living through yet another housing bubble. Still, our current situation bears little resemblance to the speculation-driven bubble that fueled the 2008 financial crisis. Let’s answer a few key questions regarding the recent spike in US home prices to better understand the current housing boom.
What’s causing housing prices to skyrocket?
Simply put, scarcity is the number one factor fueling the rampant increase in home prices. The National Association of Realtors’ (NAR) report that there were just 1.1 million existing homes available for sale in the U.S. in September of 2021. That’s the lowest inventory seen since at least 1982.
Will the housing market crash again?
Unfortunately for first-time buyers, inventory of available homes shows no sign of picking up any time soon. While this means we’re probably safe from any crash in home prices, it will also make things difficult for those who have yet to purchase a home. One way to avoid shakeups in the market is to secure a fixed rate loan. Use our simple calculator to discover what your monthly fixed rate loan payment could be.
Is there any hope for first-time buyers?
Don’t despair, would-be homebuyers. The pace of new construction is picking up to help remedy low inventory of existing homes. Though it could take time, supply will eventually rise closer to the level of demand. Now is the perfect time for patient house hunters to begin saving toward entering one of the strongest housing markets we’ve ever experienced.
The current demand in America’s housing market is here to stay—at least for a while. Though you might think a mortgage is out of the question in your current situation, options could still be available to you. Home ownership is the clearest path toward building wealth, and you certainly don’t want to get left out of the current boom. If you’re interested in exploring your mortgage options, contact us today for a no-pressure appointment with a mortgage banker to discuss your options.
