Real Estate Market in the United States may be cooling, but it is still very hot. Double-digit growth is commonplace. Many sellers are still giddy with excitement as they sort through multiple offers, and desperate buyers continue to pay more than asking prices — sometimes by $100,000 or more.
Yes, the real estate boom has lasted far longer than anyone expected. According to the National Association of Realtors, existing home prices increased 14.8 percent from May 2021 to May 2022, surpassing $400,000 for the first time. According to NAR data, prices have risen 45 percent since the coronavirus pandemic began in March 2020.
But how long will the celebration last? According to online search data, consumers may be becoming concerned: According to Google Trends, more people are searching for “housing crash” and related terms now than at any time since 2007. Fitch Ratings also warned this week of “some regional home price corrections” in overheated areas. However, the rating agency did not anticipate widespread price drops.
“Despite the possibility of a home price correction, Fitch believes a Real Estate Market crash on the scale of the Great Financial Crisis is highly unlikely,” the company said. “The main reasons are that housing inventory remains limited, and existing homeowners who have benefited from low mortgage rates are unlikely to sell their homes.”
Is the Real Estate Market about to Collapse?
The last time the Real Estate Market in the United States looked this frothy was from 2005 to 2007. Then home values plummeted, with disastrous results. When the real estate bubble burst, the global economy experienced its worst slump since the Great Depression.
We do not have a bubble; rather, we are experiencing unhealthy home price growth.
Now that the housing boom is under threat from rising mortgage rates and the possibility of a recession, buyers and homeowners are asking a familiar question: Is the Real Estate Market so hot that it’s about to crash?
“The one question I keep getting is, ‘Is this a bubble?'” says Phil Shoemaker, president of originations at mortgage lender Home Point Financial. “Looking at what’s happening with home price appreciation, it feels bubble-ish.” But when you look at the fundamentals, it’s difficult to say.”
Indeed, the foundations of today’s Real Estate Market appear to be far more stable than they were 15 years ago. The number of available homes for sale is still near an all-time low, and borrowers are more creditworthy than ever.
Current home prices
Housing economists have been predicting for months that the Real Estate Market would eventually cool as home values became a victim of their own success. Home prices have risen far faster than incomes, putting a squeeze on affordability, and mortgage rates have more than doubled since August 2021.
Despite these potential price drags, home values continue to rise. Punta Gorda, Florida, is the hottest metro area in the United States. According to the National Association of Realtors, home prices in the area increased 34.4 percent from the first quarter of 2021 to the first quarter of 2022. Other hot markets include Ocala, Florida, which is up 33.8 percent, and Ogden, Utah, which is up 30.8 percent.
Price increases, according to experts, are ‘worrying.’
Homeowners, economists, lenders, and Realtors still have nightmare memories of the previous boom and bust. With home prices rising sharply in the last year, the latest boom has sparked widespread concern.
“Prices are clearly rising at an alarming rate,” says Ken H. Johnson, a housing economist at Florida Atlantic University.
Doug Duncan, chief economist at mortgage giant Fannie Mae, expresses concern about the Real Estate Market stability. Large increases in home prices have historically been a recipe for disaster.
For more: https://bitcoinnewsandreport.com/all-you-need-to-know-about-forgotten-chain-game/
