Housing bubbles are characterized by high demand, low supply, and inflated prices.
1. High demand: This means that many people are looking to buy houses, which drives up the competition for available properties. When demand is high, buyers may be willing to pay more than the actual value of the property, leading to inflated prices.
2. Low supply: With low supply, there are not enough houses on the market to meet the demand from buyers. This scarcity of available properties further pushes prices up, as buyers compete for the limited housing options.
3. Inflated prices: In a housing bubble, prices are artificially inflated due to high demand, low supply, and sometimes speculative behavior. This means that housing prices are significantly higher than what they would be based on factors like market conditions, income levels, and property values.
Overall, a combination of high demand, low supply, and inflated prices are key indicators of a housing bubble, which can have significant impacts on the real estate market and the economy as a whole.
