2008 vs Today: Burning Questions
Our weekly real estate and mortgage update looks a little different this week. There are two very important questions that we are getting asked repeatedly. You could have these same questions and want answers, too. We want to provide not only answers, but help you understand the in’s and out’s and the why of today’s market. Here are those burning questions:
“How does this market compare to 2008?”
“Is this a housing crash?”
Here we go, let’s dive in!
Click on the video above for Michael’s answers to these burning questions as well as what else is going on in today’s real estate and mortgage market!
The 2008 Great Recession started with home appreciation reaching higher highs than we had ever seen and mortgage loans were easier to obtain. Appreciation is the increase in your home’s value over time and as you can see, it doesn’t seem to be running up at exceptional levels like it did leading into the crash in 2008. The last 6 years leading into our now 2020 health crisis, appreciation seems to be at relatively balanced levels.
Today, homeowners have a tremendous amount of equity in their homes with a majority having over 50%. This tells us that homeowners today are much less likely to walk away from their homes at lower than what it’s worth. Contrary to what homeowners were forced to do back in 2008.
Let’s take a look at the last 5 recessions. Like previously stated, the Great Recession of 2008 was caused by the housing and mortgage industry destroying home prices. The recession we are in currently is far from similar. We are in a recession due to a virus giving us no indications it will have a direct affect on the housing market or home prices. We are in a health crisis, not a housing crisis.
We hope that this gives you a better understanding of today’s market compared to 2008. Our goal is always to provide the information that you want to hear and answer the questions you have.
If there are any topics you would like to discuss further with us, please don’t hesitate to reach out!
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We are another week into the pandemic and shelter in place. Please let us know if there is ANY way we can assist you and your family at this time.
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