Home prices have rebounded nearly a decade after the great recession, and a new report by realtor.com states that cumulative home prices have risen 50% since June 2009.
"Home prices are going up faster than incomes, and that's led to some of the affordability challenges that we see in the market," said Danielle Hale, Chief Economist of realtor.com. "Homes were basically on sale during the recession. ... [Today's high prices] create a bigger hurdle to get into the housing market."
Realor.com adds the country has seem more than 120-consecutive month of economic expansion, as well as wages increases over the past 10 years.
“During the last nine years, the expansion has created more than 20 million jobs, raised family incomes, and rebuilt consumer confidence,” CoreLogic's Chief Economist Frank Nothaft said in a statement. "These economic forces have driven a recovery in home sales, construction, prices, and home equity wealth.”
Additionally, foreclosure issues have reversed course, as more than a quarter of all homes at the start of 2010 were underwater. Nearly 2.7 million people lost homes from Q3 2009 and Q4 2012.
By early 2019, though, just 4.1% of homes are underwater. Home equity hit $15.8 trillion in Q! 2019, which is 159% increase compared to $6.1 million in 2009.
"We have years of home price growth leaving borrowers with record levels of home equity," says Molly Boesel, Principal Economist at CoreLogic. "So if they're in a situation where they can't pay their mortgage, they would just sell. So they won't wind up in default."
Will the good times last? There are mixed opinions as to whether the economy will continue to grow, or we are on the verge of the next recession.
“A recession will come at some point," says Boesel. "But it doesn't seem imminent this year."
The New York Times published an article in May, including various opinions on a possible recession.
However, the question of whether a recession is imminent is a complicated one. In March, the three-month and the 10-year Treasury yields inverted for the first time since mid-2007.
"Historically, an inverted yield curve is a significant sign that points to the development of an economic slowdown in the near to medium term," said Ed Delgado, President & CEO of Five Star Global, at the time. "This latest development is another in a series of economic markers that support the possibility of a future recessionary cycle.”