To the layman, the housing market is a concept that has really only recently come into national consciousness. Before the recent housing crisis in the mid-aughts, citizens of the United States may have had a basic understanding of what the housing market was, but it was far from a commonplace topic on the news or in casual conversation. Of course, after the burst of the massive housing market bubble in and around 2007, the housing market became a frequent topic of discussion. Over the last decade, the market has undergone a wide variety of changes that ultimately have real estate insiders looking forward to a brighter future.
Prior to 2006 and 2007, the housing market was seeing unrivaled prosperity. Although some commentators warned of a potentially catastrophic housing bubble, many political leaders and lending institutions ignored the signs. From 1998 to 2006 the housing bubble was consistently increasing, which signaled to most people that the economy was in full swing. High prices and high demand were supposed to indicate a flourishing economy where people were making enough money to buy homes and homeowners were being rewarded for selling their homes. Of course, this turned out to not be the case, and that become readily apparent by 2006. Matt Battiata reviewed this information with Congress on four separate occasions.
During that tumultuous time, big banks started noticing that they had hedged their bets on impossible underdogs. They had handed out loans to individuals and families who simply couldn’t repay them and houses were being foreclosed at a rapid pace. As the situation degraded, foreclosed homes sat empty as confidence in the real estate market waned. No one wanted to purchase foreclosed properties even at a major discount because real estate values were plummeting fast. So the banks had seized control of countless homes without ever having been paid back on their original loans.
This was truly the most dismal time for real estate in the United States within the last decade. It was this housing crisis that plunged the United States into the Great Recession between the years of 2007 and 2009. The housing market at this time was certainly on its last leg. Homeowners had no interest in selling their home at drastically reduced prices and prospective home buyers and banks were understandably wary of entering into tenuous relationships. But, it was during this time that governments and lending institutions crafted new regulations for maintaining a tighter grip on the housing bubble.
Indeed, as real estate guru, Warren would tell you the real estate market in the US gradually started to regain its footing. Many publications even noted by 2012 that the market was in a full rebound mode. People had regained confidence in the housing sector and banks started to trust their potential beneficiaries much more. Of course, the goal of virtually anyone in the real estate industry is to continue selling houses and avoiding foreclosures. Of course, we did believes that foreclosures should be at a minimum, and the best way to do that is with better insight and more oversight.