How Does This Market Compare to 2008?
❓"How does this current real estate market compare to 2008 when the market crashed?"❓
📌We certainly are seeing major changes in this real estate market, but nothing like 2008.
- 👉2008: over 15 months of inventory.
- 👉Today: less than two months of inventory.
📉The one thing that we are seeing in common is sales are down.
📈Sales as a proportion of active inventory is significantly higher this year than 2008.
💵2008 was an issue of lending where foreclosures were occurring. Short sales were occurring. People were very short on equity. People were getting loans that they had no business getting.💵
🏦As interest rates changed and the ARMs, which were the short-term borrowing, they had to refinance those into a higher interest rate.
📉The market just crashed.
📉Prices went down significantly because of the foreclosures and the short sales.
❗I want to be very clear; this market looks nothing like 2008.
- 👉This is just buyers electing to not participate in this market right now.
- 👉Sellers also sitting out of the market because they don't want to buy a new home and trade up their interest rate.
📌This is a market that isn't going to take the 4 or 5 years to work out like 2008. I think we are going to feel some short-term impact over the next six months to a year, but this is going to work itself out.
😀If you have any questions about buying, selling, or investing, don't hesitate to reach out to me.