Today's Market is not like 2008 - What is everyone seeing/thinking?
Not Comparing Today's Real Estate Market to 2008
The market crash in 2008 is not the same as what is happening today. It's crucial to understand the differences to make informed decisions.
The recession and economic meltdown in 2008 were a direct result of the housing crisis. Irresponsible lending practices and inflated prices led to a collapse.
In 2008, banks gave out loans to unqualified borrowers, underwriting practices were too lenient, and appraisers often worked with banks to close deals. Many unqualified buyers ended up in bad debt, leading to defaults and an oversupply of housing.
Today is different. Buyers are more qualified, benefiting from extremely low interest rates. The affordability of payments and responsible borrowing practices are contributing factors. Additionally, government stimulus measures have led to inflation, driving up the prices of everything, including real estate.
Why aren't prices coming down? Sellers realized that selling their homes and losing their low rates wasn't financially advantageous. This reduced housing supply, even with lower demand due to rates. In some areas, supply can't keep up, resulting in price increases.
Today's market is hyperlocal. Unlike 2008, the national market decline, today's market varies from city to city. Downtown areas may experience oversupply, while outskirts/suburbs see limited construction and increased demand, causing prices to rise.
Remember, no one can predict the future, so contemplate your decision carefully. If buying for the long term, consider that those who bought at the peak of the 2008 market are currently in a favorable position.