Monday, January 20, 2014 Discusses Potential for Texas Housing Bubble
Q: How does the current housing market in Texas compare with other states? Home prices in Texas are more encouraging than in most states. Only three other states – Oklahoma, South Dakota and Nebraska – have also rebounded to the same rates they’d seen pre-recession.

Q: Why has Texas succeeded in a way that other states haven’t? When the American economy collapsed in 2008, the housing bubble wasn’t as extreme in Texas. While many homeowners outside of Texas experienced serious price decline, it was easier to recover in Texas. Generally, Texas has a more stable economy than most states, meaning that the housing market typically does not reach one extreme or another every time there’s a disturbance.

Q: I’m confused about what is and isn’t a housing bubble, can you explain? There is absolutely nothing wrong with asset prices increasing in value. When home prices move up gradually over decades, that is not considered a bubble. In order to be defined as a bubble, there must be a real capacity of that bubble bursting. When a significant amount of people choose to sell during a short period of time, that’s a bubble.

Q: What are real estate experts saying about the possibility of a housing bubble in the near future? The economists from leading authority Real Estate Center believe there’s no reason to be concerned about a housing bubble over the next few years. The supply of houses in Texas is not too high. Low inventories are driving home prices even higher.

Q: What’s the outlook for the Texas housing markets in the next few years? It could be many years before the building industry gains access to necessary capital for overbuilding the housing market. Right now, our company offers an extensive array of home loan options throughout Texas.