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Why Today's Housing Market is Different
With all the headlines lately, along with mortgage rates moving up and down so often, it's understandable why some buyers and sellers are wondering if home prices could fall as they did during the 2008 housing crash.
One of the biggest reasons that the crash became so severe was that many homeowners had little or no equity in their homes. When prices dropped, many owed as much as, or even more than, their homes were worth. That made it difficult to sell, leading to a wave of foreclosures that pushed prices down even further.
Today's market looks very different. Americans have about $34.9 trillion in home equity compared to $14.4 trillion in mortgage debt. That means most homeowners have built a significant financial cushion if they ever need to sell.
Home prices can still rise and fall, and interest rates will continue to change. But today's housing market is built on a much stronger financial foundation than it was leading up to 2008.
If you're wondering how today's market or current interest rates could affect your plans, I'd be happy to refer you to a lender and/or visit with you and answer any questions.
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