Housing is in danger of overheating again: Zillow’s Stan Humphries | Cross River Homes

 

Home values in more than 1,000 U.S. cities are expected to surpass their pre-2008 levels within the year, according to a new report released today by Zillow.

“It’s definitely a mixed bag of news,” says Humphries in the video above. “On the one hand you’re happy that home prices are recovering so nicely. On the other hand home values were definitely overvalued in 2006 and the fact that just so shortly after the greatest housing recession of the century we’re already seeing a lot of metros return to their peak levels is a sign for how robust the recovery is…but some markets are definitely in danger of overheating again.”

He continues: “In some markets, people are spending more of their incomes on a mortgage than they did during the 15 years before the housing runoff,” says Humphries. “Broadly speaking though, at a national level we think homes are still very affordable.”

Another issue that’s affecting home buyers: lending requirements. Now that the volume of refinancing has decreased, banks are getting searching for new ways to make money: they’re lowering down payment requirements, targeting lower credit-score borrowers and more.

A recent Wall Street Journal article reveals that mortgage standards are becoming more lax. Within the past year, one in six homebuyers made down payments of less than 10%, which is the highest share since 2008 (excluding FHA mortgages). But in early 2007 that figure was more than 44%.

 

 

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http://finance.yahoo.com/blogs/daily-ticker/housing-is-in-danger-of-overheating-again–zillow-s-stan-humphries-122948058.html

Robert Paul

Robert is a realtor in Bedford NY. He has been successfully working with buyers and sellers for years. His local area of expertise includes Bedford, Pound Ridge, Armonk, Lewisboro, Chappaqua and Katonah. When you have a local real estate question please call 914-325-5758.

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