[vc_row][vc_column][vc_column_text]Almost everyone has an opinion on whether the real estate market is a bubble ready to pop right now, but when it comes down to it, the most credible opinions are the ones backed by knowledge and expertise.
We gathered expert opinions from professionals who have devoted their careers to advising others on housing industry trends and predictions.
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.”
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.”
The Joint Center for Housing Studies:
“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.”
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.”
As you can see, all of these experts strongly believe that we won’t see collapsing home prices as we did in 2008. And they’re not alone – many other credible experts share the same opinion.
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