When you hear headlines about all the changes in the real estate market, it’s understandable to think about a housing bubble bursting because we all lived through that not so long ago. But rest assured, the Novato housing market is not crashing and this is not a repeat of 2008. How do we know? Here are 3 ways. explained by Erin McGinnis with Team McGinnis Realtors at Compass.

#1: Not Enough Housing Inventory

There simply aren’t enough homes for sale to cause a dramatic drop in prices. The chart below shows months of housing inventory nationally. Right now it’s 3.2 months. That means if no other houses came on the market, it would take 3.2 months to sell every house currently listed. During the Great Recession, that number ranged from 8-10 months because the market was flooded with foreclosures and short sales.

#2: It’s Harder to Get a Loan Today

In the early 2000s, banks made it easy for just about anyone to qualify for a home loan, and that led to mass defaults. Today, lending standards are much tighter. The graph below shows how easy or difficult it is to get a mortgage. When the number on the chart is high, like it was in 2006, it was easy to get credit; look at how different it is today.

#3: Few Foreclosures

Foreclosure activity is miniscule compared to what it was during the 2008 housing crash. Today’s borrowers are more qualified and less likely to default on loans, and homeowners have much more equity in their homes than they did 15 years ago. So even if they get into financial trouble and need to sell, they can, and often at a profit.

If you’re thinking of buying or selling Novato real estate, we’d love the opportunity to guide you through this market so you have a positive experience.

Please reach out via the form below or call us today: 415-725-1911