Is the Housing Bubble About to Burst?

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In many markets, home prices are through the roof.

In 2020, just two years ago, the average price of an American home was about $375,000. Today? $500,000. And with mortgage rates rising, affordability is becoming a real issue. So here’s the question: Do we buy now before prices go even higher? Or do we wait and see if prices and rates drop?

Today, we’re going to try to answer that question.

Stacy Johnson, CPA, financial journalist Miranda Marquit and novice investor Aaron Freeman talk about what’s going on with housing and whether now is the time to buy.

Our special guest this week is Mindy Jensen from real estate website and podcast BiggerPockets.

Remember, while we sometimes talk about specific investments on this show, never take them as recommendations. Before investing in anything, do your research, and make your own decisions.

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Are we in a housing bubble?

In this podcast, we take some time to talk about what, exactly, a housing bubble is — and try to figure out if we’re in one.

The Federal Reserve is raising rates specifically to slow housing. Consider this: 40% of inflation is directly related to housing costs. So the Fed is targeting housing. They want prices to stabilize, and for this hot market to cool down.

Check out some of the following articles, designed to help you learn more about the current situation.

• Robert Shiller: Should You Buy a Home in the US?
• Fortune: The odds of a home price decline hitting your local housing market, as told by one interactive chart
• Fortune: The end of booming home prices is almost here, national mortgage bankers group says
• Redfin: Pricey Coastal Markets Show First Signs of Housing Slowdown
• Fortune: The housing market enters uncharted waters
• New York Times: The Sky-High Pandemic Housing Market Finds Gravity Does Exist
• Forbes: Will The Housing Market Crash?
• CNBC: Opinion: Housing prices are still surging, but a bubble doesn’t seem likely
• Check out the housing starts data Mindy mentioned to get an idea of how much room we still have
• We’ve also got an article on housing markets most likely to fall

Should you buy a home now, or wait for prices to drop?

Now is the time to take a step back and try to decide if you should buy a home now, or wait for the housing market to cool down. We’ve got some great insights from each person on the show, talking about how buying a home fits (or doesn’t fit) into their priorities right now. No matter your situation, we’ve got some ideas for you.

• Check out our slideshow on the cheapest places to buy a home in the U.S.
• Make sure to check out our article with the case against buying a home right now
• Don’t get FOMO! Before you move forward, here are signs you might not be ready to buy a home
• On the flip side, we have another article about when it makes sense to buy a home despite the market going crazy
• Looking to get out of the country? We’ve got an article on places where you can be an ex-pat and buy a home for a bargain price

Meet this week’s guest, Mindy Jensen

Mindy Jensen is a licensed agent in Colorado and has been buying and selling houses for more than 20 years. She’s the Community Manager for BiggerPockets.com and the host of the BiggerPockets Money Podcast.

• Website
• Podcast

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About the hosts

Stacy Johnson founded Money Talks News in 1991. He’s a CPA, and has also earned licenses in stocks, commodities, options principal, mutual funds, life insurance, securities supervisor and real estate.

Miranda Marquit, MBA, is a financial expert, writer and speaker. She’s been covering personal finance and investing topics for almost 20 years. When not writing and podcasting, she enjoys travel, reading and the outdoors.