Is the housing market going to crash in 2022?

by grahamteam-chime-me

@grahamteam
Most asked question we get: Is the housing market going to crash? #housingmarket2022 #greatrecession #housingmarketcrash #realestatesource
♬ original sound – Graham Team | NV Realtors

Gidget Graham answers the most common question we get asked today and provides insight on the current housing market conditions.

Is this a repeat of 2008?

It’s going to be a fender bender, for sure. We think when most people look to the term “crash”, it means something similar to 2008 where prices dropped 50%. If you’re waiting for a similar occurrence to 2008 to make a steal on a home, you may be waiting a lifetime. In 2008, the housing market led the country into the Great Recession. During that time, you could get a mortgage no matter your income, debt ratio or ability to repay. Those predatory lending practices have stopped. Today’s buyers have to qualify with down payment funds, verifiable income and strong credit scores. The quality of the buyer is a different between today’s housing boom and that of the mid-2000s.

Recent housing data

In June, we have seen inventory rise and the number of days on market increase. In May, buyer demand slowed after the rise in interest rates and median sales prices. These two combined placed homes out of the affordability range for many potential buyers. The decrease of buyer demand could cause some minor price adjustments, but we’re still at very low inventory levels. For prices to drop in a significant proportion, we would need to see inventory rise at a level that far exceeds demand. We believe May set the price cap, and the price may fluctuate downward slightly in the coming months.

A balanced market is good for the Economy

We’re moving towards a more balanced housing market. This market adjustment will give buyers more options when looking for a home. Sellers will not see 20 offers in two days with cash amounts over appraised value for the remainder this year. A balanced housing market is good for our local economy.

Real estate cannot be lost, or stolen, nor could it be carried away purchased with common sense, paid for in full, and managed with reasonable care is about the safest investment in the world.
Franklin D. Roosevelt

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