Are we in a housing bubble? Is it getting ready to pop
So with the interest rates skyrocketing and a lot of buyers wondering, are we in a housing bubble and is it getting ready to pop?
So are we in a housing bubble? No, unfortunately we're not in a housing bubble and honestly, it doesn't seem like it's gonna pop anytime soon. Although the market might feel like the foreclosure crisis back in 2006. It certainly doesn't look like it. When looking and studying the data, it looks nothing like 2006 So what are the major differences that were seeing?
In 2006 there were really two things that stood out. Number one was going to be people that were purchasing loans, or purchasing homes, I should say couldn't afford those homes. So when they couldn't make that payment when the market crashed, that led to a ton of foreclosures. Now the second thing was all the homeowners that pulled out equity in their homes, and then property values decreased. They were underwater on their homes could no longer afford their mortgage payment. And boom, we had another wave of a ton of foreclosures hit the market. You know, the biggest difference though is back in 2006 the demand was artificially inflated right through loose lending where anyone and everyone can qualify for a loan. But now with lending guidelines much stricter it ensures that the people who are actually qualifying for homes can actually afford them.