Rick Nazarro of Colonial Manor Realty talks with a pair of interested buyers in the driveway as a couple waits to enter a property he is trying to sell during a “controlled” open house on May 2, 2020 in Revere, MA.Blake Nissen | Boston Globe | Getty Images
The housing market has been white hot for the past year, thanks to the stay at home and work from anywhere culture of the pandemic.
But there is increasing concern among consumers that housing is experiencing a price bubble – and that the bubble may be ready to burst.
Google reported last week that the search question “When is the housing market going to crash?” had spiked 2,450% in the past month. “Why is the market so hot?” searches had doubled in just a week.
And, in the most telling indication that the market may be in a bubble, “How much over asking price should I offer on a home 2021” jumped 350% in that same week.
There are various measures of home prices, but one of the most timely and watched is from CoreLogic, which showed prices up 10.4% in February year over year. That is the largest annual jump since 2006.
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“We’ve got an acute shortage of supply on the market for sale at the same time that record low mortgage rates are driving the appetite to buy by millennials and Gen-Xers,” said Frank Nothaft, chief economist at CoreLogic.
There are about half as many homes actively listed for sale compared with this time a year ago, according to realtor.com. That has caused competition to ignite to the point where buyers are more likely to find themselves in bidding wars.
That Google question about overpaying doesn’t sit well with Nothaft.
“I have to admit I’m worried when I hear that. It does make me concerned,” he said. “That’s the mindset that comes in, because that means