It’s Started: The Real Estate Market Crash | Housing Bubble 2022

Описание: In this video we'll talk about the current state of the real estate market and whether we are heading toward a housing bubble.

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Yes, it’s true. If you aren’t aware home mortgage interest rates are rising at the fastest pace since 1994. Somehow that hasn’t stopped home buyers.

Homebuyers aren’t getting discouraged even though the amount the typical American household would have to spend on its monthly mortgage has risen.

This has led a Realtor.com economist to say that “we are skating close to another” housing bubble because over the past 12 months.

And CoreLogic now considers 65% of U.S. regional housing markets to be "overvalued." That "overvalued" label was given to every metropolitan area in Arizona, Florida, Texas, and Nevada.

Before we dive into today’s market we need to better understand the relationship between mortgage interest rates and housing prices.

Economists say that higher mortgage rates will discourage some would-be purchasers. And average home prices, which have been soaring at about a 20 percent annual rate, could at least rise at a slower pace.

Rising real estate interest rates makes buying or selling a home more difficult. Now that we understand that let’s take a look at how rising rates have impacted the housing market historically.

Housing economist Tom Lawler said. Yale economist and S&P/Case-Shiller Home Price Index godfather Robert Shiller agrees. Tom Lawler also provides a little theory on why

The Dallas Fed researchers were blunt in their assessment by saying

FIRST: MILLENNIALS AND GEN Z WILL KEEP THE MARKET STRONG.
There is data that shows a decrease in mortgage applications, fewer online searches and fewer home tours that shows signs that some buyers are waiting on the sidelines this spring.

SECOND: SUPPLY CAN’T KEEP UP WITH DEMAND
They say that the “supply-demand imbalance is the primary reason home prices have escalated so rapidly”.


THIRD: UNLIKE 2008, BUYERS ARE LESS LIKELY TO DEFAULT ON THEIR MORTGAGE.
Today, more than 76% of mortgages go to borrowers with a credit score EXCEEDING 760, lending standards have increased, and home equity is at a record high.

FOURTH: Rising Interest Rates Betters the chances of NOT having a recession
Research done by the Federal Reserve Bank of San Francisco suggests that over the last 140 years of macro economic data that

Also, current mortgage rates are historically the norm. We have seen similar interest rates in 2018, 2011, and 2010. And hadn’t seen them below 5% prior to 2009.


AND FIFTH: MOST PREDICTIONS INDICATE THAT HOUSING PRICES WILL CONTINUE TO RISE - BUT SLOWER.
For instance, the Mortgage Bankers association predicts a 4.8% increase throughout 2022…CoreLogic expects a 6% increase…and Realtor.com predicts a 2.9% increase. While Zillow forecasts 14.9% growth over the next 12 months.