Today's Housing V.S. Great Recession
With the recent COVID-19 fueled “Pandession” (Pandemic Recession) creating uncertainty in the housing market, it is undoubtedly understandable for buyers and sellers to hit the panic button and resort to the last time they got burned, the Great Recession.
Rest assured, these are not the same circumstances as the Great Recession. While demand in both situations is significantly low, the number of homes (supply) on the market in 2008 was nearly 4 times what it is today.
Additionally, the equity of owner-occupied homes increased to a record $29.2 trillion in the third quarter of 2019, according to the Federal Reserve.
The increase in homeowner equity, currently American’s have a 64% equity stake in their own homes, is up from the previous year, and significantly up from Great Recession levels, where it was below 50%.
Lower mortgage rates will continue to assist demand levels by allowing qualified buyers to have more buying power and lower their monthly payments.
Check out the graphics below to see more differences between today’s market and the Great Recession.