Why a Housing Bubble Is Nothing to Worry About

  • Denise Graves
  • 04/26/21

Are we in a housing bubble? I don’t think so, and here’s why.
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A lot of people have been wondering if we’re in the middle of a housing bubble. Some media outlets like to say we’re absolutely in one, while others say there’s no way a housing bubble is possible. Unfortunately, there’s no real way to tell for sure. 
 
Many of my buyer clients are concerned that they’re paying top dollar for properties that won’t hold their value due to a bursting housing bubble. When I think about the past, there were definitely bubbles that popped—especially in 2008. This occurred because of investors throwing money at houses, and it was incredibly easy to get a loan. They didn’t need to prove their income or down payment amounts, and they could basically purchase as many homes as they wanted. A lot of people did this because they thought market trends would continue going up and up. As you’re probably aware, they didn’t.
 
"If you sit on the sidelines waiting for prices to decrease, you could be missing out on increased equity."
 
I don’t think there’s a bubble today, and here’s what I tell my buyers when they ask me why:
 
1. There are not as many investors in the market. I’ve heard that only around 10% of homebuyers are investors right now. Regardless, there aren’t enough in the market right now to cause a bubble.
 
2. Home prices continue to increase. Prices have increased about 8% to 10% in the last year, and this may continue for the next few years. If you sit on the sidelines waiting for prices to decrease, you could be missing out on increased equity.
 
My advice is to not worry about the bubble. If you let the thought of it prevent you from buying a home, you could look back a year from now and kick yourself for missing out. 
 
If you decide to buy now, a good Realtor will help you navigate the market and find a home that works well for your needs, wants, and more importantly, your budget. If you have any questions or would like more information, feel free to reach out to me. I look forward to hearing from you soon.
 
 
 

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