Are We Headed For Another Housing Bubble?

Housing Bubble

Real estate prices are rising, but are they going up too fast? Are we headed for another housing bubble?

This is unlikely. The low supply of houses for sale is one reason that has been driving the recent upsurge in prices. We’re seeing a lot of people who are able to sell or who are finding it more attractive to sell. We should see inventory levels used up a bit.

One strong factor that we’re not heading for another housing bubble is the mortgage rates. Economists believe that they are going to continue to go up, slowly but surely. Along with this is the fact we’ve seen very little foreclosure activity of late. With some of the recent changes on how foreclosures are processed, we’re going to start to see more foreclosures and that’s going to add to our inventory help.

I just read a report from CoreLogic, one of the biggest real estate data firms, and they also admit that housing bubbles are usually spotted in hindsight. But to reach affordability levels that we saw back in our bubble here, prices would have to go up by as much as 47% or interest rates would have to rise to 6.75%.

Tune in to KXL‘s “Experts on the 19′s” every Monday morning at 6:49AM and 8:49AM and listen to real estate advice from Portland’s Real Estate Advisor, Rick Sadle.

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