This is the most common question I get right now. People know patterns and tend to try to pick up on them and fill in the blanks. We know that we had some similarities between now and the last housing cycle, so naturally people want to be prepared. And of course our brains want us to always be prepared for the worst possible scenario.
While now of us have a crystal ball, the National Association of REALTORS does work with some great economists who work hard to help us have an idea of what may be in store. There was an interesting report that came out in December, and one of the big things it showed was some similarities and differences between pre-2008 and now. Check out these numbers. I do think there are some important differences:
Looking at that table, there are three big things that jump out to me. First, look at the number of job cuts. That is a big difference. Next, we have virtually no subprime loans this time around. And third, there is a much lower housing inventory on the market. While we are all feeling the extra dollars in our budgets being squeezed tightly, it appears that there are some positive economic factors taking place overall.
So, while we don’t have a crystal ball, the analysis that has been given shows that we are not expecting a housing crash at this time.