So according to you, the primary cause of the crash was relaxed lending requirements by banks, and now even though that primary cause no longer exists, you think there is going to be a crash because a lot of people are interested in real estate? That doesn't even make sense.
People are naturally attracted to whatever makes money. If the stock market were to see annual gains of 20%+ for a few years then a large number of people would stop being Saturday afternoon landlords and start being 'stock gurus'.
The only thing that can cause an actual housing market crash, is for people to start defaulting en masse on their loans, which can happen only if the loan is unstable, or the job market is unstable. In 2008 this happened because banks were giving anyone and everyone a loan regardless of the credit score, down payment, or income. They gave loans to people who couldn't possibly repay those loans, especially when their adjustable rate mortgages increased. Another scenario is if we experience another great depression, or prolonged recession. People who were previously financially stable can become unstable if the economy sucks and they can no longer find a job.
Having a large number of people interested in RE will certainly drive the price up, and this increase in price will create more people who want to invest, and this hype will further drive prices up. This is what happened in 2008. The difference is banks in 2008 kept giving ridiculous loans that they are no longer giving, which by default creates a realistic limit to how high prices can go. We have seen prices go up by large amounts following the crash, and this increase will likely start to flatline a little bit at some point, or possibly even recede slightly, but this will not cause a crash. So long as the underlying loan is solid, and the job market is solid, then real estate as a whole is solid.
We've seen one crash in the last XX years, and suddenly everyone becomes Nostradamus and feels the next one is right around the corner. Will the market flatline or possibly have a market correction in the next 1-10 years? -Possibly. But I am worried about this about as much as I'm worried about what Kim Kardasian just posted on twitter. A market correction doesn't scare me in the slightest because I invest correctly from day one, with built in equity and cashflow so that I can easily survive during the down years, and thrive during the up years. I'm nowhere near close to cashing out and retiring, so I am actually hopeful for a market correction because all of my current assets will still produce, and my future purchases will be made at a discount.
