Real estate prices reaching new highs in ten states
- More people becoming sellers
- Shortage of very desirable properties
- Burdens associated with owning property
- Greedy bankers will push for more…
The on-again real estate frenzy has begun with real estate prices reaching new highs in ten states. These are very desirable urban areas like San Francisco and New York. It is strictly a supply and demand situation where prices are going up because demand is high and supply is limited, keeping prices up.
What will ease the supply problem will be sellers who have been waiting; they will see rising prices and decide to sell. Over the next six months, until the end of the year, home prices will inch up in most markets. The mortgage rates will also inch up causing more people to want to buy before they rise more.
There will still be a shortage of very desirable properties. There will be more foreclosure action as well as increased pressure on homeowners from banks to refinance. Banks will be putting a lot of effort into convincing people to refinance now that prices are going up. On the other hand, the fact that mortgage rates are going up will cause many not to buy and they will rent.
Therefore, rents will remain high and rental properties will be at a premium. Many renters will never convert into being home buyers again. They will have trouble saving for a down payment. Also, once they start renting and get out of all the burdens associated with owning property, they will like that very much. So rents will remain high and the demand for rental properties will also be high as builders cannot build multifamily properties as quickly as they would like to.
As the mortgage rates rise, greedy bankers will push for more mortgage loans and look for ways around new lending regulations and laws just like they did before the crash. Investors are still busy buying distressed properties, but they won’t be flipping them, they will be fixing them up and renting single-family houses.
QUESTION: What should readers take away from this message today?
ANSWER: That if you have been holding off as a seller you should think about selling now.
QUESTION: Why is this information timely?
ANSWER: This information is timely because there is a shortage of desirable properties in most markets.
QUESTION: How can readers best apply this information to their lives right now?
ANSWER: People who would like to downsize their living style, as well as the demands associated with owning property should consider selling now and becoming renters for the rest of their lives.
COMMENTARY: As real estate heats up so will those ninja loans. Ninja loans are the low-quality subprime loans that caused the real estate bubble to burst in 2008. There is no good real estate investment, only shortages that cause real estate frenzies in very exclusive high demand urban markets. Otherwise, real estate is nothing more than an over-leveraged financial instrument that bankers make a killing on while undermining anything real about real estate.