Is the Housing Market Crash Really Happening?

Photo by Breno Assis on Unsplash

I’m seeing everywhere that people are talking about how the housing market might crash and I’ve got my own opinions on this. First of all, do you remember what 2008 was like?

A lot of YouTubers on here are making videos saying that the housing market is doomed to crash, just like it did in 2008. The thing is, housing economists don’t seem to think that the ongoing housing boom is closing in on a 2008-type bust at all.

In fact, many are saying that the opposite is true. There’s a wave of first-time homebuyers, along with wage growth, and short supply — all of which will only push the market in an upwards trajectory.

This is according to many, many economists.

That isn’t to say there isn’t a bit of a housing issue right now, though. Mortgage technology and data provider, Black Knight, found that Americans now have to spend 31% of their monthly income just to make a mortgage payment. That’s with an average priced home in the U.S.

Still, according to Dallas Fed researchers: “Based on present evidence, there is no expectation that fallout from a housing correction would be comparable to the 2007–09 global financial crisis in terms of magnitude or macroeconomic gravity…

Among other things, household balance sheets appear in better shape, and excessive borrowing doesn’t appear to be fueling the housing market boom.”

For two years, we’ve all been kind of worried about what might happen next with the housing market. With prices as high as they are right now, some of you who are looking for a house might be able to afford a place of your own if another 2008-type crash happens.

Home prices have instead hit a record high and buyers are offering up to six figures just to secure a home. Here in Vegas, a townhome or a duplex will go for $190,000 to $200,000 and folks will pay, with cash, an additional $10,000 to $20,000.

Is that even worth it to you? Do you think they’re on to something?

Because if these experts are to be believed, then yeah — the prices could continue to rise, but if we hit another 2008 crash, those who paid over $200,000 for a townhome might be kicking themselves in the pants.