In two words, easy credit. You could buy a six-hundred thousand dollar house basically without a job, or the means to pay the mortgage.
Quickly, and without batting an eye. In the second quarter ofprices jumped by 6. Coupled with inventory that is 9 percent lower than it was in and income that has not kept up with prices, the natural post-recession question arises.
That drove up house prices and made it harder for people to buy starter homes. Meanwhile, the market was split into two halves: On average, 87 percent of the housing markets tracked by NAR experienced rising prices inup from an average of 75 percent in In areas that were hard hit by the housing bubble, current market trends vary, and not all of the data is rosy.
Today, the city appears to be recovering. It has the fourth-highest population growth in the country, adding 61, residents last year, according to the US Census.
In the extreme case, there is Vegas, which suffered the highest foreclosure rate in the country following the housing crash. Though sales and prices have been edging back, thousands of people are still reeling. Those who borrowed against their homes or bought at the height of the market may not see a return on their initial investment.
Some still owe more than their homes are worth, 15 to 20 percent by some estimates. Add to the mix a 6. Foreign buyers are not investing in the high-end condos, and people see these prices dropping.
There is a trickle-down effect. This gap could spell trouble down the road. In total, about 64 percent of Americans own their own homes, compared with 68 percent a decade ago.
This low housing stock drives prices up.
In some cities, prices, even at the low end of a market where inventory is most scarce, are unaffordable for first-time buyers. In the higher end of the market, there are houses to sell. Thirty-two percent of home sales today are going to maiden purchasers, compared to 40 percent historically, says the NAR.
In certain areas, potential young homeowners, even with such salaries, have to forgo equity and continue to rent. But in places such as San Jose, first-time buyers have enough money to buy even overvalued property in the lower swath.
Some millennials have access to credit and to inventory, and mortgage rates are low. It would seem that the way to stability, then, simply requires more homes for people to buy. But houses are not a typical commodity.
First, homeowners are staying in place longer, limiting the number of existing homes for sale. Low unemployment rates are keeping them from leaving town in search of work.
High home prices are inspiring them to remodel rather than relocate within their communities, if they want a different kind of house. First-time buyers who can afford it might buy a home that can accommodate two kids instead of one, precluding a move a couple years after their purchase.
Grandparents are staying put to live near their kids, rather than flying off to retirement far away. Second, new construction is still springing back from the recession.
Home builders have had a hard time keeping up with population growth since then, in most cities. But the construction industry has shown signs of life. Even when they do build, developers are restricted by urban planning and geography, in certain states more than others.
Sincethe city has grown 8.
Lifestyle preference also drives the market. There is some development in the outskirts, but where people want to be, in the city, there is only finite space.By , the housing market will crash and it needs to crash. Realtors want you to think it’s all about supply and demand but it’s not.
Over 75, homes in the bay area are already in pre forclosure stage. I predicted the last crash.
I predicted the turn around. Sold my investment properties in , , bought 14 more after the crash, made millions I don’t see the same factors in play now.
Loans are not that easy to get, so we don’t have tons of. By Jesse Colombo. Here is a list of infamous stock market crashes, economic bubbles and financial crises that have occurred throughout history. I am continuously writing about additional crises (including Enron, the mids housing bubble & the Stock Market Crash of ), so please keep checking back in the future.
Six factors influencing the UK property market in It could be a better year in Britain’s dysfunctional housing market for first-time buyers and tenants Patrick Collinson. Could The Housing Market Meltdown Happen Again?
Federal meddling in U.S. housing markets was almost entirely to blame for the housing crash and subsequent financial crisis that cause markets.
May 19, · MELTDOWN - The Men Who Crashed The World - The first of a four-part investigation into a world of greed and recklessness that led to financial collapse.