It's all sparking fears that the United States is in the middle of another housing bubble that will end in a terrible crash. Yet today's housing market is very different from the mid-2000s bubble that wrecked the economy. "In some ways this is an even hotter housing market than before the Great Recession," said Aneta Markowska, chief economist at Jefferies. This is crucial because excessive leverage is what allowed the bursting of the mid-2000s housing bubble to spiral out of control. "Less leverage means household balance sheets are better positioned to handle a decline in house prices," Bank of America economists wrote.

Source: CNN July 27, 2021 10:21 UTC