Throwback Thursday: Housing Market Recovery

I thought it might be fun to go back and look at some older posts you may have missed. These are some of my favorites filled with great info. Even if you already saw this one, it never hurts to be reminded.

People considering buying a house or those of you thinking of selling your house often want to know if this is a good time to do either. I just did a FAQ video post about being asked this question, so I thought it would be a good time for this throwback. Check out that post for links to a few stories backing up my opinion.

Has the Housing Market Recovered?

I'm asked this question all the time..."Have we recovered from the housing bubble crisis?" I'm also regularly asked, "Is it going to happen again?" Here are my thoughts.

In case you were living under a rock a decade ago, the housing bubble crisis people are asking about occurred in 2007. For a period of years prior to that many factors were unnaturally inflating housing prices. In the most simple terms, some of those factors were unscrupulous lending practices and too much speculation in some markets including Florida. People were getting mortgages they could not afford. When the FED raised rates, the adjustable mortgage rates skyrocketed causing many borrowers to default and home prices to drop drastically. This lead to a banking crisis and recession. (This is a very over simplified explanation.)

So, have we recovered? I suggest you take a look at this price chart from our local MLS. It shows median home prices for the last 10 years. In 2009 the recovery had already started. There was a bit of a dip at the end of 2010, but since then you can see we have had steady increases in the median home price in this area. We may not be back at the unnaturally overinflated prices prior to the crash, but we are doing just fine. If you purchased a home 10 years ago in this area at the median price point, you would see a 73% appreciation. Averaged over 10 years, that's 7.3%/year. According to Zillow, the national average home appreciation rate is between 3-5%, so I'd say we've done pretty well.