Are we headed to the next housing market crash? Looking at the headlines, it’s easy to think that a crash is coming soon, but let’s look deeper than the headlines to see what’s really going on in this market.
Hello, I’m David Novak with David Novak Homes and RE/MAX Professionals, and let me help you dig deeper for some clearer information.
Foreclosure rates have been a hot topic recently in regards to a market crash. With moratoriums starting to lift, the foreclosure rate is rising as we all expected. However, the rates will not be close to what we saw in 2019, which was a more normal market. Now, let’s look at mortgage rates and actually take a look at a piece written by CNBC that stated, and I quote, “Mortgage originations will drop 33% in 2022 as interest rates rise according to the industry forecast.” But in order to see what they really mean by this statement, we have to look a little deeper. This piece goes on to talk about how the refinance rates will drop 62%, but that quote, “mortgage originations” for the purpose of buying a home are forecasted to rise 9% to a record 1.73 trillion next year.
Now, according to the University of Michigan, Consumer Sentiment in September 2021, only one in three people thought it was a good time to buy a home. But with interest rates rising and appreciation rates still high, there is a whole different story that these headlines aren’t telling us. Now, make sure you look deeper than the headlines when you are deciding if now is the right time for you to buy or sell a home.