Home values are soaring. Mortgage rates are zig-zagging. And the housing market has taken center stage in the U.S. economy.
Sarah Pierce, head of operations at mortgage company Better.com, and Morgan Bellingham, Better.com’s head of mortgage, say home prices are unlikely to crash — and refinancing your mortgage still might be a good call.
They spoke to Bankrate.com about the housing economy.
We’re always concerned we’re in a bubble. However, this current boom in home values is really due to an unprecedented housing shortage. Millennials are entering into an age where they’re going to buy. It used to be the prime buying ages were 29 to 31. Now it’s 31 to 35. It’s taking millennials longer to save up for homeownership. There’s a whole generation that delayed their homeownership by five years. Plus, people are living longer and staying in their homes. Building hasn’t kept pace with the demand.
It’s different than a bubble, where you have price inflation. This is more of a classic supply-and-demand problem. Even as people return to work at a lot of companies, are companies really going to pay for prime real estate in Manhattan? I think the in-home office is definitely here to stay, so people are going to need more space.
