"Are we in a housing bubble? When is the market going to crash? Is it going to be 2008 all over again?"
These are probably the most common questions I receive, and they are legitimate concerns given the unique market conditions over the last few years! The average home price in Kootenai County has increased by 48% over the last 3 years and there is an historically low amount of homes available. Covid has also contributed to the North Idaho market as many people from Seattle, California, and Oregon are flooding the market and driving prices up, making it difficult for locals to purchase a home.
So, is it a bubble? Or a boom?
I recently attended a seminar on this topic and they outlined five reasons why we think this might be a BOOM rather than a BUBBLE:
1. Mortgage standards are not the same as the mid-2000's. I just spoke with a lender yesterday who could attest to the fact that they are watched VERY closely in order to avoid nefarious lending practices.
2. There is not a surplus of homes like there was during the 2008 crash. In fact, it is just the opposite.
3. New construction is not making up the difference, so the demand continues to remain and even grow.
4. Interest rates are keeping payments affordable and there are very few adjustable rate loans anymore.
5. People are equity rich. Many folks purchasing homes in CDA are doing so with cash, and those who take out loans are investing wisely.
What are your thoughts??? Do you think we are in a BUBBLE or a BOOM?