Today’s highly competitive, nuanced housing market has caused buyers to wonder if there’s an impending crash similar to the mid-2000s, but today’s housing fundamentals are largely sustainable, says Zillow. Increased housing demand, elevated sales activity, and price appreciation are three areas causing concern, but these factors are expected to last several years, proving each are sustainable trends. Zillow notes that there are market conditions similar to the mid-2000s housing boom, such as the 10.6% home value increase in March. March’s home value gain was Zillow’s highest one-month increase ever recorded.
But that view ignores the fact that the housing market doesn’t operate in a vacuum, and is driven by the interactions of a number of relatively simple but critically important fundamentals — including supply and demand, financial conditions and technological advancement. And the state of those fundamentals in 2021 is ultimately far healthier, and that health far more likely to be sustainable over the longer-term, than the out-of-whack fundamentals from a generation ago.
Examining each of these fundamental pieces on their own, including how each has evolved to its current point and how they are different from 2008, can help us paint a bigger picture of a housing market positioned to see the boom of the past year continue to roll on.
Advertisement
Related Stories
New-Home Sales
Mortgage Rates Are Up but New-Home Sales Still Solid in March
Lack of existing home inventory drove a rise in new-home sales, despite higher interest rates in March
Labor + Trade Relations
Who's Earning What in Construction
Workers in construction management roles may earn a higher median wage, but on average, lower-paid occupations have experienced somewhat faster wage growth
Build to Rent
Build-to-Rent Is Booming, Particularly in These Metros
A recent report finds that the Phoenix metro leads with more than 4,000 build-to-rent units completed in 2023, and Texas is the leading state for build-to-rent development