A really hot market with increasing home prices usually culminates in a housing bubble that eventually pops. When that happened in the past, a foreclosure crisis was quick to follow.
Some people believe the market is in the right position now to bring about a crisis in 2022, but others do not feel the same way. Fortune says there is unlikely to be a crash in housing marketing anytime soon.
Real estate outlooks
Real estate outlooks project housing prices to continue to move upward. The next 12 months have a projected increase of around 3%. That rate does show growth, but it is slower than the current increases, which is a sign to watch.
More likely prediction
The more likely thing to happen in the immediate future is a slowdown where the market cools gradually. It will hit a major low at 3% growth, but that will only benefit homebuyers who have been struggling in the current sellers’ market.
Of course, there are always variables that could throw all predictions off. Current economic issues, such as supply chain issues and labor shortages, will continue to impact the market for new homes, which only increases competition for existing homes.
The other is the interest rate. The federal government could raise rates, which would reduce the number of buyers in the market and lead to a slow down.
Real estate is not always predictable. Many things influence prices and demand. While the market may be hot right now, most predictions say it is going to see a cooldown, but nobody is predicting a huge housing bubble collapse and foreclosure crisis.