A recent report by CoreLogic revealed that U.S. home values appreciated by more than 37% over the last five years. Some are concerned that this is evidence we may be on the verge of another housing “boom & bust” like the one we experienced from 2006-2008.
Recently, several housing experts weighed in on the subject to alleviate these fears.
Sean Becketti, Freddie Mac Chief Economist
Edward Golding, a Senior Fellow at the Urban Institute’s Housing Finance Policy Center
Christopher Thornberg, Partner at Beacon Economics
Bill McBride, Calculated Risk
David M. Blitzer, Chairman of the Index Committee at S&P Dow Jones Indices
A recent article by Teo Nicolais, a real estate entrepreneur who teaches courses on real estate principles, markets, and finance at Harvard Extension School concluded that the next housing bubble may not occur until 2024.
The article, How to Use Real Estate Trends to Predict the Next Housing Bubble, looks at previous peaks in real estate values going all the way back to 1818. Nicolais uses the research of several economists. The article details the four phases of a real estate cycle and what defines each phase.
Nicolais concluded his article by saying:
The reason for the price appreciation we are seeing is an imbalance between supply and demand for housing. This has created a natural increase in values, not a bubble in prices.