From the National Association of Realtors, we know that the supply of homes in different in today’s housing market than it was in 2008. Back in 2008, there were too many homes for sale compared to the number of buyers in the market. There was also a wave of short sales, foreclosures, and overbuilding that put the market into a bubble.
Is the housing market going to crash like it did in 2008?
What other key indicators show that today’s market differs from 2008?
- We have a strong labor market today, while the last housing downturn saw, in just a single year, 8 million job losses.
- We are seeing much less risky home loans offered while subprime loans were common during the 2008 housing market bust.
- The rate at which mortgage borrowers were delinquent on their loans was at 10% in 2008 versus 3.6% today.
- We are seeing an historically low foreclosure rate at 0.6% whereas 2008 saw a 4.6% foreclosure rate.