Housing Bubble Burst? 13 Ways to Predict a Housing Market Crash


For the most part, stock market investors, are aware of and accept the risk that prices will fall from time to time, many people who purchase a home do not believe that the value of their home will fall soon.

Perhaps it’s hope or greed, but no one likes to consider the possibility they’re buying just before a housing market crash.


That said, compared to other asset types, over the last fifty years, its unsual to see bubble in the housing market which is immediately followed by a housing market crash; The last obvious example was the Credit Crisis.


This could be due to the high transaction costs of selling a home as well the cost of owning and maintaining a home, all of which discourage speculative behavior.

Signs That the Housing Market Will Crash

Will We See a Housing Market Crash?

Whether you’re a homeowner or a buyer, the prospect of a housing market collapse is scary. The last thing you want is to own a massive, inflated asset while the economy is collapsing.

1) After an Extended Period of Acceleration, Home Prices Are Plateauing

If one of the trends in the housing market is year on year, consistent real estate price increases, it indicates the possibility of an impending housing market crash or at a minimum, a more benign correction.

2) Numerous Risky Mortgages Available

When we start to see lower mortgages expanding in the market, it’s another warning that a housing market crash is on the way. Higher mortgages could create a housing catastrophe if lenders relax underwriting credit standards and riskier mortgage requirements.

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