Are forbearances going to cause a market crash?
Hi, I'm Tami Savage with eXp Realty.
As of February 14th, it looks like we're in pretty good shape based on the information from The Mortgage Bankers Association.
84% of people who entered into forbearance are either out of forbearance or working through it to set up repayment plans.
Of that 84%, 50.8% have paid off their mortgage. 33.6% have worked out a repayment plan, which leaves us with 15.6% that are still in trouble.
It's important to understand what's happening with forbearances.
Since May, the numbers have continued to go down.
And as of April 12th, 4.66% of all mortgages are still in forbearance.
We keep hearing all this information in the news about how we're going to crash because the number of forbearances is so high.
But if you look at the real facts, that just isn't true.
In fact, in 2021 the experts are forecasting on average an increase of 5.9% appreciation in home prices for 2021.
Americans' seem to be concerned because of the scary headlines saying the market is going to crash due to 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.
It's a very different situation today than back in 2008.
And it's easy to listen to the news, but it seems there is a lot of hype and negativity around what is happening
which is just not based on the actual facts.
I'm Tami Savage with eXp Realty, Your Key to a New Lifestyle.
I'd love to help so don't hesitate to reach out.
Thank you for watching, and make it a great day.