The Term, Housing Bubble, Keeps Coming Up, but Is It Accurate?

The Term, Housing Bubble, Keeps Coming Up, but Is It Accurate? 

The term, Housing Bubble, keeps coming up, but is it accurate? The local real estate market here in the Des Moines area is generally healthy. Home sales this year have been slightly ahead of last year most of the year and inventory levels are improving overall.

Using data provided by the Des Moines Area Association of REALTORS shows that homes priced less than $250,000 are still in a sellers market with less than a 2 months supply of inventory remaining. Sales in this price range are down slightly, but that is likely due to the lack of inventory. 

Homes in the $250,000 to $400,000 range are in a balanced market with just over a 5 months supply of inventory remaining. Homes priced over $400,000 are in a buyers market, but close to balanced, with right at 7 months supply of inventory remaining. Sales in both these price ranges have increased in the last month which is a good sign for the economy. 

The following blog shares how industry experts consider the housing market at a national level. 

A Housing Bubble? Industry Experts Say NO!

With residential home prices continuing to appreciate at levels above historic norms, some are questioning if we are heading toward another housing bubble (and subsequent burst) like the one we experienced in 2006-2008.

Recently, five housing experts weighed in on the question.

Rick Sharga, Executive VP at Ten-X:

“We’re definitely not in a bubble.”

“We have a handful of markets that are frothy and probably have hit an affordability wall of sorts but…while prices nominally have surpassed the 2006 peak, we’re not talking about 2006 dollars.”

Christopher Thornberg, Partner at Beacon Economics:

“There is no direct or indirect sign of any kind of bubble.”

“Steady as she goes. Prices continue to rise. Sales roughly flat.…Overall this market is in an almost boring place.”

Bill McBride, Calculated Risk:

“I wouldn’t call house prices a bubble.”

“So prices may be a little overvalued, but there is little speculation and I don’t expect house prices to decline nationally like during the bust.”

David M. Blitzer, Managing Director and Chairman of the Index Committee at S&P Dow Jones Indices:

“Housing is not repeating the bubble period of 2000-2006.”

“…price increases vary unlike the earlier period when rising prices were almost universal; the number of homes sold annually is 20% less today than in the earlier period and the months’ supply is declining, not surging.”

Bing Bai & Edward Golding, Urban Institute:

“We are not in a bubble and nowhere near the situation preceding the 2008 housing crisis.”

“Despite recent increases, house prices remain affordable by historical standards, suggesting that home prices are tracking a broader economic expansion.”

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Jon Niemeyer is the Broker/Owner of EXIT Realty North Star, 1039 Sunset Dr Norwalk, IA 50211. We provide full service real estate services to the Des Moines, Iowa metro area. Learn more about Jon at

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