Charleston: Among Top 7 Regions with Overvalued Home Prices

[Melissa Searing]

If it looks like a bubble... and feels like a bubble...

http://www.postandcourier.com/article/20150525/PC0...

Thoughts? 

[Chris Tiff]

Depends what the basis for the conclusion is. The article itself wasn't that clear. If it's based mostly on pricing models, inflation and national trend charts, then possibly. However if the actual prices in Charleston are driven more by growth and expansion, rather than pure speculation, and unless you anticipate growth slowing and jobs being lost, then probably not. If a market is bubbling over based on speculation and cheap funding alone then it has a problem. This was the case during the dot com boom and the RE run up pre 2008. Conversely, if prices are rising based on solid growth patterns and trends then it has a far more solid basis for sustainability. It's up to you as an investor to decide which it is.

Price run-ups, even rapid ones, are not automatic indicators of a 'bubble' per se, though this definition seems to be trending over the last few years, rather a bubble is significant price appreciation without the fundamental substance to support it. That's what Greenspan was talking about when he coined the phrase.