If you follow the news, chances are you’ve seen or heard some headlines about the housing market that don’t give the full picture. The real estate market changes, and when it does, it can be difficult to separate fact from fiction. That’s where a trusted real estate professional comes in. They can help demystify the headlines so you can truly understand today’s market and what it means for you.
Here are three common housing market myths you may have heard, along with expert analysis that provides better context.
Myth 1: House prices will fall
One con that many buyers have seen or heard is this housing prices are going to crash. This is because headlines often use similar, but different, terms to describe what happens to prices. Some of the ones you can see right now include:
- Gratitudeor rising house prices.
- Depreciationor lower housing prices.
- And daccelerationwhich means house prices are rising, but at a slower pace.
The point is experts do not call for price reductions. Instead, they predict the gratitude will continue, only in slow motion. This means that house prices will rise, not fall. Selma Hepp, Deputy Chief Economist CoreLogic, explains:
“. . . higher mortgage rates combined with more inventory will lead to slower home price growth but a decline in house prices is unlikely.”
Myth 2: The housing market is in a correction stage
Another common myth is that the housing market is in a correction phase. Again, it’s not. That’s why. In accordance with Forbes:
“A correction is a sustained decline in the value of a market index or the price of an individual asset. Generally, a 10% to 20% drop in value from the recent peak is considered a correction.»
As mentioned above, housing prices are still rising, and according to experts, this will continue, but at a slower pace. This means the housing market is not in correction because prices do not fall. That’s just a softening of the past two years, which have been record-breaking in almost every way.
Myth 3: The housing market will crash
Some headlines are raising concerns that the housing market is a bubble ready to burst. But experts say that today there is nothing like 2008. One reason is that lending standards are very different today. Logan Mohtashami, Lead Analyst HousingWire, explains:
“As talk of a recession becomes more common, some people worry that mortgage lending will get much tighter. This usually happens during a recession, however The notion that American credit will collapse like it did between 2005 and 2008 couldn’t be more wrong because we didn’t have a credit boom between 2008 and 2022.”
During the last one housing bubble, it was much easier to get a mortgage than it is today. since then lending standards have strengthened significantly, and mortgage buyers over the past decade are far more qualified than they were in the years leading up to the crash.
No matter what you hear about the housing market, let us connect you with a Band Premier Broker today 541-323-2779. That way, you’ll have a seasoned authority on your side who knows the ins and outs of the market, including current trends, historical context, and more.