Nearly all experts predict we are not. Here’s Frank Martell, President, and CEO of CoreLogic.
With prospective buyers continuing to be motivated by historically low mortgage rates, we anticipate sustained demand in the summer and early fall…
Additionally, housing market investors don’t perceive there to be many similarities to the 2008 housing market crash. The bottom line is no one has any real concerns about a sudden drop in prices as home price statistics, provided by Forbes, show consistent month-to-month increases in prices.
Greg McBride, the chief financial analyst at Bankrate.com, told Forbes that although home prices are climbing, any perceived similarities to the housing bubble and crash of 2006-2008 are yet premature:
The [current] rise in prices is a byproduct of a severe imbalance between supply and demand, not the ‘loosey, goosey,’ anything-goes lending that so was so prevalent in the [2006-2008] housing bubble
McBride also points out that, unlike the 2006-2008 period, lending standards have greatly tightened. Banks are now only lending to the most creditworthy mortgage customers, suggesting a price crash is probably not in the cards. But McBride warns that if lending standards loosen again and “we see the [excessive lending] practices we saw from 2004-2006, then all bets are off.”
Frank Nothaft, the chief economist for CoreLogic, told Forbes that subprime borrowers are now “largely absent” from the mortgage market. The subprime borrowers were partly to blame for the prior housing meltdown. The list of experts with similar beliefs that the housing crash is not imminent is extremely long. They don’t believe there is anything close to a repeat of 2008 in the near future. Only time will tell.