The US housing market is expected to lose its appeal soon due to a significant drop in home sales and a reduction in home loan applications by 64% since August 2020. The housing affordability is at the lowest level in 33 years, which is below the 2006 low at the peak of the last housing bubble. The housing supply is significantly high due to the massive supply of new homes for sale, recording a nine months supply in the US. The current mortgage lending standards are as bad as experienced in 2008, affecting the housing market’s performance.
Heading 1: Is The Housing Market About To Burst Again?
Heading 2: Home Sales Are Coming To A Grinding Halt
Heading 3: Home Loan Application Volume Is Significantly Down
Heading 4: U.S. Housing Affordability Is At Its Lowest Level In 33 Years
Heading 5: Housing Supply: What Effect Will The Market Have?
Heading 6: Massive Supply Of New Homes For Sale
Heading 7: Mortgage Lending Standards Are Just As Bad As Back In 2008
Is The Housing Market About To Burst Again?
It’s a question on many minds today, as the housing market seems to be slowing to a halt. With home sales grinding to a stop, it’s clear that something is going on in the market, and experts are starting to take notice. What’s causing this sudden downturn, and what does it mean for home prices in the future?
Home Sales Are Coming To A Grinding Halt
Checking out home loan application volume, it’s significantly down by 64 percent since August of last year. This is a clear sign that home buyers are pulling back, and lenders are noticing. With fewer people looking to buy homes, it’s clear that the market is starting to slow down.
U.S. Housing Affordability Is At Its Lowest Level In 33 Years
Worse still, U.S. housing affordability is at its lowest level in 33 years, below the July 2006 low, which was at the peak of the last housing bubble. This is a clear indication that the market is overheating, and home prices may start to fall, making homes more affordable for buyers in the years to come.
Housing Supply: What Effect Will The Market Have?
What effect do you think this has on housing supply? While there now seems to be a massive supply of new homes for sale in all stages of construction, over nine months supply in the U.S., which is the highest level since the tail end of the 2008 crisis. With so many new homes on the market, it’s clear that there’s some concern about the future of the housing market.
Massive Supply Of New Homes For Sale
Now people are saying this time is different, the housing market we have today is nothing like it in 2008. Oh really? Today mortgage lending standards are just as bad as back in 2008 by the two most important metrics. It’s clear that the market is slowing down, and it’s anyone’s guess what will happen next. Is it possible that we’ll see another major market collapse in the coming years? Only time will tell.