Stock Market Plunge: Is Real Estate Safe?
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Is the stock market crashing? The short answer: no—the Dow is just a little bumpy right now. Recent Wall Street frenzy had people from all over the world fearing that a U.S. real estate bubble might be the culprit after the stock market suddenly took a nearly 1,600-point (4.6 percent) plunge. According to CNN Money, it was the biggest point decline in history during a trading day.
However, experts say there’s no reason to worry. While homeownership rates and home prices are currently at an all-time high, they are not to blame for the market’s volatility.
“The types of corrections we are seeing in the U.S. stock markets are not expected to negatively impact the housing market unless the current volatility causes the market to significantly fall below normal levels,” says Joseph Kirchner, senior economist for realtor.com®. “Despite [the] correction, the market is still 15 percent above a year ago and economic fundamentals remain strong.”
For 2018, we are at full employment and a stock market crash will not have the same effect on foreclosure rates. In today’s market, the lending institutions have tightened standards to preserve equity in their portfolios, and, since 2008, the government has instituted regulations to protect consumers against predatory lending.