ByAmy FontinelleAre you gearing up to buy your first place? Shopping for a home is exciting, exhausting and a little bit scary. In the end, your aim is to end up with a home you love at a
4 Stats That PROVE This Is NOT 2005 All Over Again
| Recent research by the National Association of Realtors (NAR) examined certain red flags that caused the housing crisis in 2005, and then compared them to today's real estate market. Today, we want to concentrate on four of those red flags. |
"Loose credit was one of the main culprits of the housing crisis. Mortgage lending expanded dramatically as unhealthy housing speculation reached its peak and was met by the highest level of credit availability as measured by the Mortgage Bankers Association. The index measures the overall mortgage credit condition by the share of home sales financed by mortgages. This metric does not capture credit quality, but it does set a view of the importance of financing in supporting the housing market."House flipping was rampant in 2005. As NAR's research points out:
"Heightened flipping activity is a clear indication of speculation in the real estate market. A property is considered as a speculative flip if the property is sold twicewithin 12 months and with positive profit. Flipping is a normal part of a healthy housing market. In an inflated housing market, expectations about short-term profit from pure price appreciation are very high; therefore, the level of flipping activity would show evidence of being heightened."Here are the categories with percentages reflecting the unrealistic ratios & numbers of 2005 as compared to the current market. Remember, a negative percentage reflects a positive gain for the market.
Bottom LineThey say hindsight is 20/20... Today, experts are keeping a close watch on the potential red flags that went unnoticed in 2005.
I am a specialist in the management and sale of bank owned AND investment properties throughout SE and Central Pennsylvania. Our team of (14) real estate agents and (3) support staff are here to e....
Latest Blog Posts
by Jana RandallImage: Getty ImagesPrintIt's officially fall — use this handy checklist to make sure your house is ready for the seasonShareTweetPinWith cooler temperatures knocking, now is