The TV pundits who make general statements about the real estate market (good and bad) aren’t helping those in need of accurate data for their specific area – get it locally.
But the talking heads have the ability to influence, and in this video they actually have a few good things to say about the real estate market. If the national stats can wobble along over the next few months, will pundits start talking it up?
You could’ve at least warned us to wear boots while listening to this guy. “The problem is the appraisals.” Where did they find this guy? “We have some overhang, but not enough.” Is he expecting a population explosion? Of course he closes w/the obligatory, “It’s a great time to buy.” Spoke as a true cheerleader.
The inflation talk in is the air though, and once rates creep up just a little, the talking heads will be pointing to real estate.
It’ll give home buyers more permission to act.
Also from cnbc:
It’s interesting to note that the implied inflation rate in the 10-year TIPS has gone from 1.5 percent to 1.92 percent this week. So we’re beginning to see inflationary pressures,” Kass said. “It’s very clear in the gold market, it’s clear in the industrial commodities and the CRB,” the latter a reference to the Commodity Research Bureau.
While inflation was 1.15 percent in August and was in that range for the entire summer, the CRB’s Continuous Commodity Index has seen a steady climb and is in fact about 24 percent higher than it was last year.
Plus below
But Cohen worries that investors have not been selective and may have just created a new credit bubble from the ashes of the old one.
“People just need to be cautious. They’re not sitting on the sidelines, which I can understand,” she says. “It just looks like no lessons were learned from the credit crisis. People have licked their wounds, gotten out of equities and gone into the bond market with abandon.”
But their experts!
http://www.ritholtz.com/blog/2010/09/zandi/
The thing that peole don’t realize about Economics is that to get a job as an Economist you have to be Keynesian ( believe in market intervention ) and not someone the believes in free markets.
Who would hire someone that says doing nothing is the answer? How do you access the performance of an Economist that pushes for letting the markets do their own thing and to not get involved? You could get the same result not hiring them. See the catch-22?
I have a degree in Economics but got out of the race when I saw that 90% of the paths all ended up in the same place.
I think the average price need to drop by at least 20% or household income for those with job needs to increase for the math to work. Can we check if that Brain guy is buying any properties NOW for himself ?
RC,
The federal reserve could continue lowering interest rates allowing idiots to extend themselves even further. (if interest rates are 2% the monthly payment for 600k is the same as 400k at 4.5%)
Governments could “give” money/tax incentives to home buyers.
Banks could continue limiting the supply of houses on the market by not foreclosing.
All the above has been going on for the last couple of years.
I’m with Josie. The only things that guy’s missing are the rainbow wig and big red nose.
I thought Michelle’s distinction between the two sides – people who bought expensive homes, and people waiting to buy – targets a good point. Right now there’s more owners of expensive homes making policies, lobbying for government intervention, etc. Remember Jim’s post about Geithner’s overpriced turkey? Deep down, everyone’s looking out for their best interest.
Apparently the recession ended June 2009. Capitalism is moving pretty slowly… I agree with the anchor, renting should be a viable option. That way you can buy the Porsche today and you don’t have to worry about saving for it later.
Gimme 2% plus a $50k credit and I’m all in.
Sayonara dollar.
Too little attention is being paid to the impact of tightening underwriting standards. This has the effect of pulling housing prices closer to annual income levels. It will take years for prices to come down or income to improve in order to support higher housing prices. Lower interest rates can only compensate for a small amount of this impact. When interest rates rise this problem will reassert itself in the form of lower loan amounts people can qualify for. Left to their own devices everyone would buy a beachfront house in La Jolla however the system will no longer allow that!
Yep the rant on appraisals was pretty lame. V shaped recovery? – Not likely unless jobs come back quickly.
More likely that housing will remain muted for at least another year, although better neighborhoods that are decently priced will be going up in price.