You can only have a crash if the inventory is overtripping demand.
I don’t see that happening with real-estate at the moment. Ask an agent how inventory is.
“Ask an agent how inventory is.”
Exactly. The selling of my house closes next week. There are no properties for sale within 7 miles of my house. Everything, all 10 or so, properties that have been up for sale in the past 90 days are under contract. Nothing new for sale in the past 30 days. The real estate supply/demand imbalance won’t get resolved for at least another year. I suspect we’re in for an economic growth for the next 5 years and a housing demand to continue along with it.
I can see a geographic based crash. The northeast, for example, versus the Florida market are two different animals. With tons of people moving south, I can see the supply/demand curve for housing causing prices to go down on the NE - especially with inflation and supposedly higher interest rates coming. Florida, OTOH, will continue to be a huge sellers market.
We are in the process of buying a house. Inventory is minimal. Got outbid on one, knew the next couple would be the same. Cash was the name of the game or no contingencies. We are buying a new build. Locked in the interest rate and it should be finished end of March. Barring anything unforeseen, we have a house. It will be our home so bubble, or not, we will pay the mortgage and enjoy our place.
There will be a crash when people can’t make the mortgage payments. What also happens is that people walk away from their mortgages when their home’s value takes a big tumble.
In many states, mortgages are non-recourse. In other words, if a person gives their home back to the lender, the lender can’t come back at them for any deficiency. It’s sort of a protection to encourage lenders to not loan more than what property is worth in the short to medium term. Once that happens, look for house prices to fall dramatically.
Also, it is the investors buying up houses for rental income. When those values start to drop significantly, they will sell their properties. They will still have made a good return on their investments, but they don’t want to wait until the market hits bottom.