Fed Calls it a Housing Bubble - … 1st time since early 2000's

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‘Unhinged’ And ‘Abnormal’: Fed Warns Of Housing Bubble As Average Cost Of New Homes Hits Record High

https://www.dailywire.com/news...

The continued rising costs in the housing market have caused the Federal Reserve to warn of a housing bubble, something not seen since just before the market crash of 2008. Phillips said this means the Federal Reserve sees people overpaying for houses causing a “market exuberance.” The Federal Reserve called the exuberance “unhinged from fundamentals” and “abnormal … for the first time since the boom of the early 2000s.”

Now, the Federal Reserve is warning about a housing bubble.

Housing prices have spiked 25% over the past year, and since 2012, the cost of a new house has doubled, Phillips explained. “Cities with the biggest spikes were Phoenix AZ, Miami FL, and Tampa FL, but overall, it was houses in southeastern states that saw the largest spike in 2021,” said Phillips to “Morning Wire” hosts Georgia Howe and John Bickley. “But again, it’s really everywhere across the country.” Including Texas and California

Looks to me like we are at "Euphoria" sliding toward "Anxiety" - hang on for the ride

[Nick C.]

Anyone waiting around for a repeat of 2008 is going to be very disappointed. Buyers may be paying too much right now, but these loans were underwritten well. If someone has no money, no skin in a property, is underwater, and has an unsustainable adjustable interest rate mortgage they walk away and go into foreclosure. This time around borrowers had good credit, good jobs, have skin in their properties via down payments, reserve funds, and a locked in low interest rate 30 year loan. If the value of their house drops, so what? They keep paying the mortgage and life goes on. 

I keep thinking about supply and demand. There's very little supply and an outrageous amount of demand. Sure, rising interest rates  or some unforeseen event could cause prices to drop. But then everyone would just stay put. No foreclosure crisis this time.