Is the Housing Bubble About to Burst?

The question lands with a thud every time the market heats up: Is the housing bubble about to burst? In Greenville and its surrounding Upstate counties, the frenzy can feel familiar—multiple offers, waived contingencies, prices climbing at a clip. But similarity isn’t sameness. In this episode of Selling Greenville, the conversation steps back from the noise and compares today’s environment with 2006–2007, where euphoria met lax lending, speculation, and the Great Recession that followed. The verdict here is clear: while some stats rhyme, the story—and the underlying mechanics—are very different.

Why “Is the Housing Bubble About to Burst” Hits Different This Time

Housing bubble about to burst: The core of the episode is a careful contrast between the run-up to 2008 and the current market. Yes, the Upstate has seen aggressive appreciation—double-digit gains across the broader area in the recent past. And yes, bidding wars and appraisal talk are back in everyday vocabulary. But two structural shifts are doing the heavy lifting to separate them from now: lending discipline and cash.

Then: speculation on easy money

The mid-2000s boom was buoyed by loose underwriting and an assumption that price growth would do everyone’s heavy lifting. Buyers stretched into homes they couldn’t truly afford on the bet they could sell higher “next year.” When incomes couldn’t support payments and values rolled over, foreclosures cascaded, appraisals lagged reality, and a credit crisis followed.

Now: tighter lending, more skin in the game

Today’s pattern is almost the inverse. Lenders have tightened—especially for investors—and government-backed products are more conservative. Some banks even paused lending on rentals temporarily. On top of that, a noticeable share of buyers are bringing substantial down payments or purchasing in cash. Rather than riding soft underwriting, they’re neutralizing risk with dollars up front.

That’s a materially different foundation than a market running on teaser rates and “hope-it-appreciates” math.

What’s Driving Today’s Deals (and Why It Matters)

This episode unpacks several practical realities shaping outcomes in Greenville and the surrounding markets—and how those realities change the “Is the housing bubble about to burst” conversation.

1) Appraisal dynamics aren’t the same as last cycle

Back then, appraisals sometimes floated with froth. Today, lenders may still waive appraisals—but typically when buyers bring 25–30% down. In other words, the bank’s risk is cushioned by cash, not wishful thinking.

Even when appraisals are required, buyers with strong cash positions often waive the contingency. They’re prepared to bridge a shortfall if the number comes in low. That single choice transforms the risk profile of a deal.

2) “Resetting the market” with cash gaps

The episode makes a point many overlook: if a buyer pays above recent comps and covers the difference in cash, that closed sale becomes the next comp. Paying, say, $150 per square foot in a $130 per square foot neighborhood isn’t necessarily irrational if the plan is long-term, because that sale will anchor future valuations. It’s not a flip-it-next-year strategy; it’s a plant-your-flag-and-hold strategy.

3) The appraisal contingency is a power lever

For sellers, offers without an appraisal contingency (especially cash) are often stronger than “highest price” offers tied to financing and valuation. For buyers, waiving it only makes sense if they can truly cover the gap. The episode also flags a local nuance: even if a listing says “no appraisal contingencies considered,” South Carolina law requires a Realtor to present all offers to the seller. Blanket ultimatums in the remarks can be a turnoff; smart conversations with agents go further than rigid rules printed in all caps.

4) Not all appreciation is equal—or permanent

Recent year-over-year, market-wide appreciation in the Upstate has clocked in around the low teens, 11–12% cited in the discussion. That’s hot…and unsustainable. Historically, many areas run closer to 5–6%, with a handful of transitional pockets spiking higher. The expectation here is moderation, not meltdown. Betting on perpetual double digits is a setup for disappointment; planning for a cool-down is just wisdom.

5) Builders have the brakes handy this time

A second difference from the 2000s: builder behavior. Instead of putting sticks in the air everywhere and hoping demand never blinks, many have throttled releases and been selective about new contracts—partly due to construction costs, partly due to prudence. That restraint helps keep supply from whipsawing the way it did when half-finished neighborhoods dotted the last downturn.

What Buyers Should Weigh Right Now

Know your true capacity. If you’re at 3–5% down with no spare cash, the appraisal contingency likely needs to stay. If you have the ability to bridge a gap, waiving it can meaningfully strengthen your offer—especially in multiple-offer scenarios.

Think timeframe, not headlines. The “Is the housing bubble about to burst” narrative loses force if you plan to stay put. Short-term flips depend on timing and perfect comps; long-term households benefit from normalized appreciation and, often, the comp you helped set.

Focus on fit over froth. Paying a premium for a home that actually matches your needs (location, layout, condition) can be more rational than buying a discount that doesn’t work—and then paying in stress, upgrades, and regrets.

What Sellers Should Pay Attention To

Don’t be hypnotized by the top-line number. A slightly lower cash offer without an appraisal contingency may be stronger than a higher financed offer with multiple outs. Terms matter.

Expect smarter questions from smart buyers. Appraisal strategy, closing certainty, and proof of funds are part of the conversation. The best outcomes come from clarity—what you’ll accept, what you won’t, and how you’ll compare offers beyond price.

Avoid the ultimatum tone in public remarks. Demanding “no appraisal contingency” in the listing reads as inflexible. Private dialogue through agents tends to surface better offers with fewer bruised feelings.

Why This Doesn’t Feel Like 2008 in the Upstate

Put the threads together, and the pattern emerges:

• Lending is disciplined. Banks, scarred from the last crisis, have been cautious—especially with investor loans. That’s the opposite of the “anyone with a pen gets a mortgage” era.

• Cash cushions risk. Buyers are writing checks, not just signing notes. That changes appraisal risk, default risk, and post-close stability.

• Buyers aren’t day-trading their primary homes. The mood here is “we can afford this and want to live here,” not “we’ll sell in 12 months at 10% more.”

• Builders aren’t flooding the supply. Measured pipeline control reduces the whiplash from overbuilding and abandonment.

• A cool-down is likely; a collapse isn’t the base case. The conversation anticipates slower appreciation, not a replay of the Great Recession’s broad, forced reset.

In short, the question Is the housing bubble about to burst is fair—but in Greenville’s present context, it’s the wrong fear. The smarter framing is, “How will this market normalize, and how should buyers and sellers play the hand they’ve got?”

Practical Scenario: Choosing Between Two Offers

Imagine two offers on a listing:

• Offer A: Full price, all cash, no appraisal contingency.

• Offer B: $15–20k above list, conventional financing, appraisal, and financing contingencies intact.

From the episode’s vantage point, Offer A often wins. Certainty beats hypotheticals. Even with a headline-grabbing number, Offer B can fall apart at the altar (valuation, underwriting, conditions). In a market built on clean closings and cash confidence, the sturdier path is usually the wiser one.

Final Thought on Price Per Square Foot (and Perspective)

There’s a grounded Upstate reality check here, too. Price-per-square-foot examples remind listeners that Greenville’s numbers aren’t San Diego’s. A contract $20/sq ft above recent sales looks different in a market where $130/sq ft is common in many areas (and $300/sq ft is reserved for the high end). Context matters—and so does holding period. Overpaying against last month’s comp and owning that comp after closing are two sides of the same market coin.

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Bottom Line

The loud question—Is the housing bubble about to burst?—misses what’s structurally different now. This market is running on tighter lending, larger down payments, and real cash—not the breezy leverage and speculation that defined 2006–2007. Expect appreciation to moderate; expect competition to stay situational; and expect terms (especially appraisal strategy) to matter as much as price. In Greenville’s current playbook, caution is healthy—but panic is misplaced.

Ien Araneta

Journal & Podcast Editor | Selling Greenville