SACRAMENTO (CBS13) – Housing prices across the country and in Sacramento County are back to where they were when the market peaked nearly 10 years ago.
Back then, however, millions of Americans faced foreclosure because the housing market crashed. Today’s buyers and sellers haven’t forgotten about the housing meltdown and some are worried we’re on the brink of another bubble.
“Are you kidding? I’m not going anywhere,” said Ty Smith, who bought his home back in 2008, just as home prices across the country hit rock bottom.
Less than a decade later, he thinks history is coming full circle.
“The bubble is close, if it’s not here already,” he added.
Sacramento State Finance Professor Sanjay Varshney doesn’t think we’re there just yet.
“If history repeats itself, the best real estate market and the worst real estate market of our lifetime is behind us,” he said.
Just before the recession hit in 2008, the median home price in Sacramento County dropped by more than $100,000 from $320,000 to $195,100. In 2011, it reached its low point of $164,900, and since then, it’s risen steadily. Now at $321,000, the median home price is $1,000 higher than it was in 2007.
“It’s great; we’re back up to where we paid and it’s good for the economy,” said homeowner Dan Tackett, who purchased his Natomas home in 2007.
“If you’re still sitting on the fence, thinking that ‘I’m going to way a little bit more because chances are the market might crash like it did in 2008,’ you might be waiting forever because it may never happen,” Varshney says.
And even with home values continuing to rise, Varshney warns buyers to not be afraid to make a purchase. Factors like low interest rates and relaxed loan standards that led to the crash aren’t in place in 2016. Still, the market goes in cycles, so regular price fluctuations will be normal. Varshney reminds homeowners they probably won’t see home values go up as quickly as they have in the past.
“If you can see 5 percent year over year appreciation in your home values, we should feel pretty good,” Varshney said.
Sacramento Realtor Paula Swayne says more homeowners are choosing to stay in their homes instead of sell, which has led to shortage of affordable houses in many places across California.