Three factors that mean we don’t have to worry about a housing bubble.
Are we heading into another housing crash like in 2007? Every month, there are thousands of Google searches for terms relating to “housing bubble”. It’s clearly on people’s minds. This market may feel similar to the one back in 2007 due to all the high prices, but there’s no reason to panic. We’re not in a housing bubble, and here are three reasons why we’re not:
1. We have a healthy inventory level. In Salt Lake county, we have less than three months’ supply of inventory in the market. It may be increasing daily, but we still currently have a healthy supply of properties on the market which is good news for buyers.
We’re in a healthy real estate market.
2. Stricter lending practices. During the 2007 market crash, the riskiest mortgages required nearly no proof that buyers could truly afford their properties. Today, homeowner equity is at an all-time high, and lending practices are much stricter. Plenty of buyers now have good credit, are putting a significant amount down, and are extremely qualified for their home loans.
3. A low number of distressed properties. We have less than 5% distressed properties nationwide, and the number is even lower in Utah. I don’t predict this to change any time soon.
These three factors are indicators that we’re in a healthy real estate market. Plus, it’s a good time for buyers to purchase a home because of the rising inventory. Take advantage of this opportunity to make a good deal. If you need help with your buying or selling plans, call or email me. I’m here to help!