Is a New Housing Bubble Already Here?

The housing market has made a strong recovery. But are things getting ahead of themselves now? Find out here.

Dan Caplinger
Dan Caplinger
Apr 5, 2014 at 10:10AM
Investment Planning

The housing market has rebounded sharply from the worst of the financial crisis. But now, prices have risen so much that some fear a new housing bubble has already formed and could cause problems in the near future.

In the following video, Dan Caplinger, The Motley Fool's director of investment planning, discusses the latest data from CoreLogic showing that prices in four states have hit new records. Dan notes that Texas, Colorado, Nebraska, and North Dakota all have at least some ties to the booming energy industry and weren't particularly hot areas during the mid-2000s housing boom. By contrast, Dan notes that Florida, Nevada, and Arizona are still 20% or more below their peak levels. Moreover, with homebuilders Pulte Group (NYSE:PHM), Toll Brothers (NYSE:TOL), Hovnanian (NYSE:HOV), and Lennar (NYSE:LEN) all having suffered share-price declines in late 2013, the industry looks far from bubble-like in Dan's view.