Just in the past 2-3 weeks, I’ve had a handful of people ask me if they should be putting their houses on the market (they know I follow RE and bought and sold properties at good times in the past, etc.).
These people have various reasons for selling: some have been holding onto houses as “rentals” because they were underwater and couldn’t sell them after the bubble burst, some have been hanging on by their fingertips as they waited for housing prices to get them above water again so they could sell and move (usually to cheaper and/or out-of state areas), some are purely speculative and would like to cash out at a peak and rent while the market corrects (again). IMHO, people are smelling a bubble, and this is what will open the floodgates at the peak. I think we are about to turn a corner WRT inventory levels.
You do not need NINJA loans in order to create a bubble, IMO. You just need a lot of speculative activity where a critical mass of buyers are buying with the expectation that they will sell at some future date for a higher price. I also believe that there is a LOT more leverage in the housing market than people think. Just because they aren’t using traditional purchase mortgages does NOT mean that these buyers are un-leveraged.
FWIW, many homes in our area are being listed at **above-peak** prices, and many are selling for those amounts. This is a bubble as far as I’m concerned.
