The Housing Bubble Bursts

A home for sale with Trump Real Estate

A home for sale with Trump Real Estate

In 2005, The Economist wrote that housing prices had “risen so fast, for so long” that a drop-off was inevitable. The 12.5% growth seen in the first quarter of 2005, spurred by historically low interest rates and lack of confidence in the stock market, could not be sustained and there would be international consequences.

The Economist’s prediction proved insightful, as in 2008 the collapse of sub-prime mortgage bubble and bankruptcy of Lehmann Brothers marked the beginning of the financial crisis. Until roughly 2013, home sales shrank and the luxury real estate market, including around Lake Norman, looked grim. Loans became harder to obtain and newly constructed homes were left empty for long periods of time.

Only recently, with the stock market’s tentative recovery and a drop in unemployment, have sales accelerated. New homes in The Point, Peninsula, and other high-end developments are under construction and real estate agents argue there has never been a better time to buy.

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