Are all of the Forbearances going to cause a market crash similar to what we had in 2008? As of February 14th, The Mortgage Bankers Association has information on this. And it looks like we are in pretty good shape.
84% of people who entered into Forbearance are either out of it or working through it to set up repayment plans. Almost 51% are paid in full, just under 34% worked out a repayment plan and only 15.6% are still in trouble.
It’s important to understand what’s happening with forbearance. And the numbers since May are continuing to go down and as of now there are only about 5.22% of all mortgages are in forbearance.
So we keep hearing all this information in the news about how we are going to crash because forbearance is so high, but if you look at the true facts, that just not the case.
For 2021, according to all of the experts they are forecasting an increase of 5.9% on average, for appreciation in home prices for 2021. Also, there is concern from Americans and we see scary headlines that the market will crash because of home prices increasing so quickly. However, if we compare the Average Price in home appreciation from 2002 to 2005 leading up to the 2008 crash, the average annual appreciation was 10.3%. If you look at now, from 2017 to 2020 the average annual appreciation for home prices is only 6.3% which is drastically less. Very very different situation today.
It’s easy to listen to the news, but it seems there is a lot of hype and negativity around what is happening and it is not based upon actual facts. All of the dire predictions you heard at the beginning of year have changed their tune.
My name is Eren Millam w/ Premiere Property Group and we would love to help educate you about the Real Estate Market. If you have any questions, thinking about buying or selling, we are here to help! Remember, Extraordinary Service delivers Extraordinary Results. Make it an extraordinary day!