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The Wendy Monday

7 Reasons We Are Not in a Housing Bubble

Here are 7 reasons the U.S. is not in a housing bubble. 1. Low inventory Not enough houses. In March, inventory was down 28% percent from the prior year. 2. Lack of supply coming The U.S. is 3.8 million homes short of demand, and low levels of new home construction over the past three years has increased that shortfall. 3. Buyer demographics Nearly 5 million Millennials will be turning 30 this year. Millennials will drive the nation’s real estate market for the next decade. 4. International demand As the pandemic recedes, international home purchases will pick up. Global buyers- many paying cash - seek vacation homes, primary residences and investment properties in the U.S. 5. Low mortgage rates This spring, the Federal Reserve is supporting housing market by keeping rates low for borrowers – a practice it intends to follow until 2022 at least. 6. Tight credit Risky credit practices in the early 2000s were a leading cause of the last housing bubble. At that time, risky loans were 40% of mortgages. Currently, those loans are only 2% of the market. 7. Greater equity Rising home prices and greater savings rates have increased equity for millions of U.S. owners. 1 in 3 mortgaged homes is “equity-rich,” with loans owing 50% or less of market value.


Questions about the market?

Don’t hesitate to reach out to me : wendy@wendymonday.com

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