What is a Real Estate Bubble?

A real estate bubble occurs when there is a rapid and unjustified increase in housing prices. Often this is caused by speculating investors blowing some hot air. Like an overfilled balloon, the bubble eventually pops, and then a swift drop in home values occurs. This leads to reduced equity or, in some cases, even negative equity. Fortunately, economists don’t foresee that happening!

 

Prices are going up because there’s a very low supply (homes for sale) and high demand (lots of buyers). And those market dynamics aren’t expected to change any time soon. Looking for guidance as you navigate this fast-moving market? Contact our team to learn more about current real estate trends and whether now is a good time to buy or sell.