Are Home Prices Approaching Bubble Territory?

Real Estate

As home values continue to rise, some are questioning whether we are approaching another housing bubble. Zillow just reported that:

“National home values have surpassed the peak hit during the housing bubble and are at their highest value in more than a decade.”

 

Though that statement is correct, we must realize that just catching prices of a decade ago does not mean we are at bubble numbers. Here is a graph of median prices as reported by the National Association of Realtors (NAR).

 

Here is a graph comparing actual price appreciation (tan bars) with what prices would have been with normal appreciation (blue bars).

 

Bottom Line: As we can see, had there not been a boom and bust, home values would essentially be where they are right now.