As many of us already know the housing market has been on fire in most markets. Buyers who want to buy are competing against multiple offers and sellers are able to capitalize on their
Why this housing market isn't like last time
Dated: March 10 2021
As many of us already know the housing market has been on fire in most markets. Buyers who want to buy are competing against multiple offers and sellers are able to capitalize on their equity. Housing went up so much, even in the middle of a pandemic, that people are worried we're in a housing bubble and the crash is coming. Well it's not, and here are a few reasons why not.
Mortgages are more secure and regulated than they were back in early to mid 2000s. Before almost anyone could get a mortgage and now with the new standards put in place it's much more difficult to get a mortgage.
Another reason is that prices aren't soaring out of control as much as people think they are, take a look at this graph comparing price increases during the housing bubble compared to now. It really makes one realize that even though we are still above "normal" appreciation levels of 3-4% things still aren't accelerating as much as they were back then.
New construction also plays a big role in the number of homes available on the market. We already know there is a shortage of inventory in existing homes but most don't realize their is shortage of new homes compared to last time. And now with the increase in cost of goods to build new homes builders are feeling even more of pinch to produce and keep prices affordable.
A lot of people say houses aren't affordable but when you actually look at how affordability is calculated buying is more affordable today than it has been for decades. Yes prices have increased but unlike then we now have increased wages that are coinciding with higher home prices and then you factor in the extremely low interests rates and the average homeowner is spending less of their hard earned money on their mortgage payment.
Now that you've seen some of the reasons why the housing market is not going to crash and is in fact a strong point in our economy it's time to find a you that home you've always wanted. Give me a call, I'm here to help.
Real Estate Remedy-Colorado Springs CO Real Estate- Alyce Chermack, REALTOR/Broker Associate, SRES- I provide the real estate remedy for people who are growing their nest or emptying one, so they can focus on the future without the headaches and hassles. 303-475-2792
Exit Realty Pikes Peak and its real estate professionals focus on Colorado Springs CO, located in El Paso County. We list and sell homes in Monument, Peyton, Falcon, Manitou Springs, Woodland Park, Pueblo and all nearby communities.
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