I think that we have front row seats to the next real estate bubble.
In my area of the city, some very nice homes that were selling a year ago in the 250k range are now on the market for 350k. Realtors are also posting advertisements asking local homeowners to contact them because they have a surplus of buyers.
I'm afraid that if interest rates begin to creep up the newly inflated prices/value of these properties will fall leaving people upside down with their mortgages. When that happens people that are forced to relocate usually hand the bank a deed in lieu of foreclosure and walk away.
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I agree. In Montana cities like Missoula and Bozeman prices have gone Big country sky high.
https://nbcmontana.com/news/local/housing-prices-around-montana-skyrocket-due-to-covid-19
Part of the link...
Missoula, MONT — Housing prices in Montana have skyrocketed over the past few months, and local realtors say COVID-19 is largely to blame.
"People are coming from across the country, realizing their jobs are online, and they can live where they want," said Tanya Gersh, a realtor with PureWest Christie's International Real Estate in Whitefish.
Realtors say that led to a major increase in housing prices.
The median sales price for a Gallatin County home increased from $384,000 in February, just before the pandemic, to $479,900 in August. Missoula County saw the median home sales price increase from $323,000 to $370,000. In Lake County it increased from $325,000 to $423,000. And Flathead County saw an increase from $335,000 to $415,000.
Now..
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Now
Buying a home in the Gallatin Valley continues to grow more expensive.
From September 2020 to October 2020, the median sales price of a single family home in Gallatin County increased by about 6%, from $550,000 in September to $585,000 in October, according to a news release from the Gallatin Association of Realtors.
That’s a 27.6% increase over the median sales price of $458,600 in October 2019, according to the association’s
Market Watch.