Is the Market Going to Crash Again?
by Morgan Goutermont
Everyone knows 2008 was a catastrophic year for the housing market, and because it was such a devastating time for so many, people are now very weary when they see the house prices they saw before the crash. So the big question everyone has right now: Is the market going to crash again? Here's what you need to know.
1- The housing market goes up and down, just like the stock market, and it always will. You can't prevent it, and you really can't 100% know when it goes up or down.
2- People always tell me "Prices can't go up forever." Well, you're right and you're wrong. Yes, eventually the market will cool off, there won't be crazy bidding wars, and prices will go down. Prices won't cut in half, but it may go down 8% a year for a few years. However, you're wrong in the big picture. Those prices will go back up, and they will eventually be higher than they were before.
3- What many people don't understand is, the market in 2008 didn't crash because of high house prices! It was not a bubble that finally burst! Not only that, an economic meltdown like we saw is not something that just happens. The last an economic disaster like that happened was the Great Depression, in 1929! So this really is not something that you need to have in your mind when buying a home. Will your house value go down at some point? Possibly, maybe even probably, but just like always, it will go back up.