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  • Writer's pictureRuth Real Estate Advisor


December 12, 2022, OC Housing Report

Everyone expected a housing crash in 2018 when rates rose from 4% to 5%, but it did not materialize. It did not crash after the initial lockdowns of COVID, yet so many were convinced otherwise. Even though so many feel a housing crash is eminent, and that it could be worse than the Great Recession, according to all the economic data, current trends, lending standards, and the health and strength of homeowners across the United States, there is NO crash in sight, not now, not in the next 6-months, and not in the foreseeable future.

There is simply not enough homes on the market.

Even though the market time is not that high, values are still dropping today due to mortgage rates doubling from the start of the year. Yet, home values are not tumbling at the accelerated pace of 2007 and 2008 when home values sank by nearly 40%. That will not happen today because of a very limited inventory where homeowners are choosing not to list their homes.

Even with sky-high mortgage rates and home values on the decline, housing is insulated from a housing crash. Today’s housing stock is built on an extremely strong foundation with years of tight lending standards due to financing laws enacted after the Great Recession, strong credit scores, large down payments, fixed rate mortgages, plenty of nested equity, and limited cash-out refinances. There is no crash in sight because of the strength of the homeowner coupled with a very limited inventory of available homes to purchase today.

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