This week, Erik & Randal take a look at the housing market to assess whether we are approaching another housing bubble. It's true that it's easier to get a mortgage these days and home prices are on the rise but are we really heading for another "The Big Short" situation? 


TRANSCRIPT:

Erik: 

Welcome to Stay Focused, Focus Real Estate's weekly video blog. I'm Eric Gould.

Randal:

I'm Randal Engelmann.

Erik:

And this week we'd like to...

Randal:

...give you a quick snippet....

Erik:

...about, well, a few things we're hearing. Are we in a housing bubble?

Randal:

We like to dig a little deeper instead of just looking at rising housing prices, the exuberance in the
market, and all of that. If we want to stand back a little bit and look at what's happening with some trends, okay? And look at a little bit of what happened last time around. We remember it very clearly in 2012 when we thought we were faced with another slow real estate season that the market really turned around. We were telling sellers it's 90 to 120 days to get your house under agreement. Can you believe that, ladies and gentlemen? We put some property on for our clients thinking they needed to be out by the end of July or the end of June and we were putting it on the beginning of February. Well, those buyers were faced with a five month closing time because we put it under agreement right away. So we really did see the market change at that time. That was 2012.

Erik:

Yep. So we're about six years into a market. People start wondering how long is this gonna last?

Randal:

Typically, those markets fluctuate on a 10-year cycle. Usually, seven to eight years up. Two to three years down. Somewhere in there, things start to happen. At six years, you're right into thinking, "Is this the end of this
upswing in the market?"

Erik:

But we're watching. This is a little different right now than what it was in 2007/2008 when we saw the market take some declines. We're not seeing the investors in the market predominantly flipping for quick fat
cash like they were back then.

Randal:

Yep. We're also seeing unbelievably low inventory. Not just in the Boston area but 

Both:

Nationwide.

Randal:

We're watching those nationwide trends as they're coming in this direction. We want to be ready for that.

Erik:

So, our thoughts and our professional opinion is: Right now our market's strong. All the indicators are strong. We're still in a very strong market.

Randal:

All the analysts say we've got one to two years left of rising prices. Most of them said last year we were looking at 2018 to be a gangbuster's year much like '17. We're looking at large price increases this year. They're supposed to level off a little bit next year with some more modest increases and after that time they're not sure what's going to happen.

Erik:

And we'd love to hear from you and what you think of the current state of the housing market. Please comment below.

Randal:

Thanks for watching today, everybody. Don't forget to like us on Facebook.

Erik:

and subscribe to our YouTube channel.

Randal:

And until next time

Both:

And until next time Stay Tuned and Stay Focused.

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