In the 9 years that we’ve been in the credit repair business, home prices have risen dramatically. As of June 2021, there is a frenzy in many areas around the country. Buyers are outbidding each other and paying more than the asking price. This is reminiscent of what occurred in 2006 and 2007. In fact, there is a historical trend demonstrating that the real estate market bubble bursts every 13 years or so. Given that the last correction in the real estate market occurred in 2008 and 2009, it appears that we may be due. The question then is, “how will a real estate market crash affect the credit repair business?”
What are we learning from people that are calling us desiring to repair their credit and increase their credit score in 2021? Because of the current frenzy, consumers are clamoring to buy a home. It’s as if the real estate market has no top and they want to get in on it. However, if a correction occurs anytime soon, they may miss out. Yet they may also find themselves in a great position in a year or two if they are patient and they prepare properly.
Will People Still Need to Improve Their Credit?
Consumers who are late to the party and are preparing to buy a home now will not have their efforts wasted. In fact, for those that have low credit scores, the next 2 year period is a great time to improve their credit scores and overall financial situation. If home values do decline, they could potentially purchase a home for a far lower price than if they bought now.
Many people that have waited to sell their home may start to panic a bit once a decline begins. There may be far more inventory available as people want or need to cash out of their existing homes. Real estate professionals and lenders will be looking for qualified home buyers. There will be less competition from those who can pay higher prices because they have already purchased a home beforehand. This could lead to more referrals of prospects needing to improve their credit scores from real estate agents and mortgage lenders.
So, if a real estate market crash does happen, we could expect an increase in business for those of us in the credit repair industry. As home prices decline more people will become potential home buyers. And what do home buyers need? Good credit scores.