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The 2000s United States housing bubble or house price boom or 2000s housing cycle [2] was a sharp run up and subsequent collapse of house asset prices affecting over half of the U.S. states. In many regions a real estate bubble, it was the impetus for the subprime mortgage crisis.
2000–2003: Early 2000s recession (exact time varies by country). 2001–2005: United States housing bubble (part of the world housing bubble). 2001: US Federal Reserve lowers Federal funds rate eleven times, from 6.5% to 1.75%. [40] 2002–2003: Mortgage denial rate of 14 percent for conventional home purchase loans, half of 1997. [24]
As median home prices began to rise dramatically in 2000–2001 following the fall in interest rates, speculative purchases of homes also increased. [117] Fortune magazine's article on housing speculation in 2005 said, "America was awash in a stark, raving frenzy that looked every bit as crazy as dot-com stocks."
To all the Henny Pennys of the world who think the housing market is in dire straits, Forbes.com reminds us that the 2000s were actually a great decade for real estate overall. According to ...
"Last cycle, a dog could get a mortgage," Zonda's Ali Wolf said. Today's homebuyers are in a much better financial position, both economists agree.
Housing bubbles tend to distort valuations upward relative to historic, sustainable, and statistical norms as described by economists Karl Case and Robert Shiller in their book, Irrational Exuberance. [6] As early as 2003 Shiller questioned whether or not there was, "a bubble in the housing market" [7] that might in the near future correct.
A housing bubble is on everyone's mind right now as prices hit record highs. But experts point out two underlying fundamentals remain strong. 2 signs the US isn't in a housing bubble
A real-estate bubble or property bubble (or housing bubble for residential markets) is a type of economic bubble that occurs periodically in local or global real estate markets, and it typically follows a land boom or reduce interest rates. [1]