What should homeowners and investors do to protect themselves from a potential bubble?
Nash: Look for incentives by builders on completed new construction buildings or homes; this indicates an over-supply of new units. Research days on market or the length of time of property has been on market. If the typical time recently has been 30 days for sold properties and current market times for the majority of sold properties are 60 or more days, the market is softening. Home prices and mortgage rates effect each other, as interest rates drop, the more buyers can afford to pay for a home, but as rates rise buyers can afford less of a purchase price. Watch interest rates as an indictor of deflating prices.
