Worried About A Housing Downturn? Don’t Be.
With economic instability still the first word out of any news we have going on in 2022, many of those thoughts turn to the previous economic downturn of 2007-2008 that reverberated throughout the following 2010s and what it will mean for the housing market that has shown near record-breaking high demand, low supply, and market pricing that has to be seen to be believed. While those concerns are valid, many indications, as of July 2022, show that will come next will not be 2007-2008 again.
New Real Estate Regulations
Particularly because we did not want to repeat those years in any foreseeable future, there now exist regulations in real estate buying and mortgage lending that are specifically designed to protect all involved in the short term and the long term. Extending on that point is that we also don’t have as many risky loans or mortgage delinquencies going on right now compared (in detail) to the mortgage landscape of 2007 and 2008.
Pandemic Fueled Hysteria Has Cooled
Granted, as of writing right now, a new strain of COVID-19 has begun a spread that we are taking precautions on, but that is the whole point – we’ve got two years, round-the-clock, experience of dealing with COVID-19 and protections and vaccines for it are widely available. This has reduced the fears of doomsday and the restriction level of lockdown to make the prospective of purchasing a home no longer out of reach on that contingency alone. The pandemic and lockdowns were a major, direct source of house prices skyrocketing. Now that we are past the emergency factors of those items, housing prices no longer can rely on them to keep their lofty markers.
Social Economic Climate Is Different
Returning to the subject that the 2007-2008 recession is still fresh in the minds of American society today, many people in America under the age of 40 have their memories of those years as the foundation for their social causes today. The push for higher wages, scrutiny on employers and landlords marginalizing those that are dependent on them, changing foundations of society itself and how much the housing crunch has been affecting the country with all these things going on is slowly but effectively getting attention and inspiring change – things we didn’t have during the 2007-2008 recessions. Because we live in quite a different world today than it was 15 years ago, the real estate slowdown is also vastly different as well and has much more to look forward to than what it initially seems.
As the rollercoaster of the 2020s shows no signs of not rollercoasting any time soon, it is difficult to say what even the next few months may present, but being fearful now that a repeat of 2007 and 2008 is thankfully premature. We will continue to monitor any significant changes in the real estate market, both in the Smoky Mountains and the country at large, and make sure you are armed with all the best real estate information we have to give!