One reason the market crashed in 2008 was the oversupply of homes.
Do you also think that a housing market crash will happen soon? People are talking about a potential market crash, but I’ve been looking at some statistics from the NAR, and I’ve seen two reasons why the housing market won’t crash.
Let’s start by comparing our current market to what happened back in 2008. A lot of people like to bring up that year when discussing the housing market, and for good reason.
One of the main reasons for the crash in 2008 was an oversupply of homes. At that time, about 13 months’ worth of homes were on the market. Right now, we’re in a very different situation. The market is more balanced, and we only have about 4.2 months of supply. A balanced market generally has around six months of supply, which means we’re doing well.
“We still need closer to 600 homes for a truly balanced market.”
In our local area, we’ve seen an increase in homes for sale—from 242 last September to around 390 now. But we still need closer to 600 homes for a truly balanced market.
Another big factor that sets us apart from 2008 is unemployment. Back then, unemployment was around 8.3%. Today, it’s much lower at 4.1%.
Why does this matter? When people are employed, they’re more likely to be able to afford their homes and pay their mortgages. This stability means we probably won’t see a surge in foreclosures, especially with the low interest rates we’ve enjoyed over the past four years.
What does this mean for all of us? The market is secure. You don’t have to worry about going in and buying anything. For those of you who want to sell, there are still many buyers in the market.
I’m here to help once you’re ready to buy or sell your home. You can reach me at (607) 795-2904 or vickischamel@kw.com. I’m looking forward to connecting with you.
