Where are home values headed?

If you are like me and watch the housing market on a regular basis...you must be wondering the same thing I am...why are homes selling with multiple offers and prices going up so fast.   It wasn't too many years ago sellers couldn't sell a house, but now they are flying off the selves like they did back in 2006.  Oops...did I reference the last decade?  Sorry...I don't want to make it sound like the housing market is behaving like it did in the run up to the housing crisis we witnessed in 2007, but there are some things taking place that look awfully familiar. 

In the run up to the housing crisis we saw some markets take off like a rocket...values going up at a neck breaking pace and then those markets were the first to tank when things went sideways.  Some of those same markets have had a good run the past few years....and they are now seeing their values peak and in some cases drop.   Could this be a sign to those other markets that moved up and down a little late before and after the crisis that values may not be headed higher much longer?

Of course real estate is very local in how it behaves, but buyers out there waiving inspections, waiving financing, putting in escalations clauses....well...you get the picture...you may want to use some caution here and have a plan for each house you are looking at.  I am not saying you shouldn't do what you feel is needed to get the house you want, but you should have a plan and stick to it...and not get too emotionally invested in a house. 

Keep in mind that rates will likely move higher and that may feel like a motivator to get into contract on a house now, but as rates go higher typically that will pull some buyers out of the market and could create an opportunity for values to come back in line with reality.  I wish more buyers were as motivated back in 2011 when the market was priced in the buyers favor than now....when it can be a bit frustrating to be a buyer.