Topic: Homes in 97% of U.S. cities are overvalued, Moody's says (Read 164 times)
This is the case with every geographic region, and not just the United States. Even here in India, there is a general perception that real estate is overpriced. A lot of apartments are unoccupied and here people are purchasing apartments and villas as an investment asset and not for the primary purpose of residing in them. And also, a lot of us are struggling to own our own apartment, simply because they have become very much unaffordable. And here one other issue is that the net migration towards major cities is still very significant, unlike the case for regions such as Japan, where inflow of younger people are balanced out by the outflow of elderly population towards more rural areas.
https://slate.com/business/2021/06/blackrock-invitation-houses-investment-firms-real-estate.html
There are also investment firms that are buying up houses well above market rate which is creating a bubble on its own. This wouldn't be an issue if a private firm wants to incur the risk of paying above market rates except for the potential government bailout in the event of a collapse. Firms like Blackrock haven't bought up enough real estate yet to create any sort of sizeable impact on the market, but if you're living in these communities and having billion dollar corporations buy out single family homes, you don't have a way to compete.
Are they buying and renovating it and will send it again in the market way above the market price?There are also investment firms that are buying up houses well above market rate which is creating a bubble on its own. This wouldn't be an issue if a private firm wants to incur the risk of paying above market rates except for the potential government bailout in the event of a collapse. Firms like Blackrock haven't bought up enough real estate yet to create any sort of sizeable impact on the market, but if you're living in these communities and having billion dollar corporations buy out single family homes, you don't have a way to compete.
Real state is still on a bad position as I can say compare before, the bubble is still there and yes we know the possible effect of this one if the price becomes more overpriced, tendency are it will create another drop in value and even if those companies will buy many properties, they can’t still cover the whole market.
They could be renovating it, but that's not really the issue. They're giving out offers above the market rate to incentivize people to sell their homes all to a single buyer. Not that it would have any relevance if there were multiple firms buying up all these homes from the perspective of the seller; the issue that arises is the monopoly that these firms have on the housing market. They have the ability to create a permanent class of renters with complete control on the price with no one to compete with them.
That's on top of the housing bubble they might create by paying above market prices.
The numbers! Yeah, way important than just crunching the theories I see. Ideally, growth of 47 million in population means that much houses to be added but as you said its also family so cut it down by 1/3rd considering 2 or 4 child per houses. There is still plenty of space to live. With big towers being built around I think most of the cost cut downs there itself as its community run which lowers the property maintenance cost by sharing.
But even if we cut those numbers to 5 to round it up to 10 million, there is a problem, you also need to replace old homes that are at the end of their lifespan, and when looking at what google tells me, the average age is 46, so roughly would mean you need to restock 1% each year, or about another 20% on top of those 10 million in the last two decades.
And I've not included disasters which, and this was a shock for me, destroy tons of houses, nearly 50k because of fires each year. As a European who has only seen concrete, stone, and brick houses I've never understood this whole wooden house thing. I simply couldn't live in one of them. That being said, I'm not a fan of towers either, communist blocks of the flat were a monstrosity I want to forget, and anything that would be more comfortable, insulated, spacious, and so on and on will cost a ton more.
Either way, if somebody hopes that housing prices will go down drastically in the US or Europe they are going to have to wait, a lot!
I think they are trying too hard to make a point and miss on the essentials.
They focus on a few cases that are over evaluated by ( their scoring) 50% and just between the lines mentioned that large cities are usually just 10% over evaluated, and most of them are missing from that fancy map. It's a bit misleading o focus on 30k population towns and ignore metro areas in the size of millions, if you look at the map White Plains is just 7% over and Oakland is 6% why not tell the numbers on the latest metropolis? Maybe because it's less spectacular than any research needs to be right now.
That aside, the US population in 2000 was 282,2 million now is 329,5 million a growth of 47,3 million, that's nearly New York and Texas combined, but only around 1 million houses per year were built on average in the last decade, so what do you expect? And let's not forget it's always one house per family, some have much more than that.
They focus on a few cases that are over evaluated by ( their scoring) 50% and just between the lines mentioned that large cities are usually just 10% over evaluated, and most of them are missing from that fancy map. It's a bit misleading o focus on 30k population towns and ignore metro areas in the size of millions, if you look at the map White Plains is just 7% over and Oakland is 6% why not tell the numbers on the latest metropolis? Maybe because it's less spectacular than any research needs to be right now.
That aside, the US population in 2000 was 282,2 million now is 329,5 million a growth of 47,3 million, that's nearly New York and Texas combined, but only around 1 million houses per year were built on average in the last decade, so what do you expect? And let's not forget it's always one house per family, some have much more than that.
The numbers! Yeah, way important than just crunching the theories I see. Ideally, growth of 47 million in population means that much houses to be added but as you said its also family so cut it down by 1/3rd considering 2 or 4 child per houses. There is still plenty of space to live. With big towers being built around I think most of the cost cut downs there itself as its community run which lowers the property maintenance cost by sharing.
On the other hand when it comes to individual houses, they take up the huge space and spread across large area of land so the cost is supposed to up for those properties. So recollecting, the number might be wrong or they have just put forth theory which they want in market.
I think they are trying too hard to make a point and miss on the essentials.
They focus on a few cases that are over evaluated by ( their scoring) 50% and just between the lines mentioned that large cities are usually just 10% over evaluated, and most of them are missing from that fancy map. It's a bit misleading o focus on 30k population towns and ignore metro areas in the size of millions, if you look at the map White Plains is just 7% over and Oakland is 6% why not tell the numbers on the latest metropolis? Maybe because it's less spectacular than any research needs to be right now.
That aside, the US population in 2000 was 282,2 million now is 329,5 million a growth of 47,3 million, that's nearly New York and Texas combined, but only around 1 million houses per year were built on average in the last decade, so what do you expect? And let's not forget it's always one house per family, some have much more than that.
They focus on a few cases that are over evaluated by ( their scoring) 50% and just between the lines mentioned that large cities are usually just 10% over evaluated, and most of them are missing from that fancy map. It's a bit misleading o focus on 30k population towns and ignore metro areas in the size of millions, if you look at the map White Plains is just 7% over and Oakland is 6% why not tell the numbers on the latest metropolis? Maybe because it's less spectacular than any research needs to be right now.
That aside, the US population in 2000 was 282,2 million now is 329,5 million a growth of 47,3 million, that's nearly New York and Texas combined, but only around 1 million houses per year were built on average in the last decade, so what do you expect? And let's not forget it's always one house per family, some have much more than that.
https://slate.com/business/2021/06/blackrock-invitation-houses-investment-firms-real-estate.html
There are also investment firms that are buying up houses well above market rate which is creating a bubble on its own. This wouldn't be an issue if a private firm wants to incur the risk of paying above market rates except for the potential government bailout in the event of a collapse. Firms like Blackrock haven't bought up enough real estate yet to create any sort of sizeable impact on the market, but if you're living in these communities and having billion dollar corporations buy out single family homes, you don't have a way to compete.
Are they buying and renovating it and will send it again in the market way above the market price?There are also investment firms that are buying up houses well above market rate which is creating a bubble on its own. This wouldn't be an issue if a private firm wants to incur the risk of paying above market rates except for the potential government bailout in the event of a collapse. Firms like Blackrock haven't bought up enough real estate yet to create any sort of sizeable impact on the market, but if you're living in these communities and having billion dollar corporations buy out single family homes, you don't have a way to compete.
Real state is still on a bad position as I can say compare before, the bubble is still there and yes we know the possible effect of this one if the price becomes more overpriced, tendency are it will create another drop in value and even if those companies will buy many properties, they can’t still cover the whole market.
seller are not compromising because they know they will get a good bet later. But seems like standard of life has increased people are selling at higher costs when as buyers are buying at the more higher prices.
I think it's not only in the USA that house prices are high in my country too, especially if housing is in the middle of the city or on the main road, it has a fantastic value, I don't know what is the main factor, they set different prices at one point with another.
If there’s another bubble with real estate, that could be another reason for the market recession and if this numbers are correct, US is really on a big trouble with their economy aside from the rising inflation, this is going to burst that could hurt many countries as well. Imagine if the properties are overprice and no buyers anymore, that could be the start of a big drop again.
https://slate.com/business/2021/06/blackrock-invitation-houses-investment-firms-real-estate.html
There are also investment firms that are buying up houses well above market rate which is creating a bubble on its own. This wouldn't be an issue if a private firm wants to incur the risk of paying above market rates except for the potential government bailout in the event of a collapse. Firms like Blackrock haven't bought up enough real estate yet to create any sort of sizeable impact on the market, but if you're living in these communities and having billion dollar corporations buy out single family homes, you don't have a way to compete.
Are they buying and renovating it and will send it again in the market way above the market price?There are also investment firms that are buying up houses well above market rate which is creating a bubble on its own. This wouldn't be an issue if a private firm wants to incur the risk of paying above market rates except for the potential government bailout in the event of a collapse. Firms like Blackrock haven't bought up enough real estate yet to create any sort of sizeable impact on the market, but if you're living in these communities and having billion dollar corporations buy out single family homes, you don't have a way to compete.
Real state is still on a bad position as I can say compare before, the bubble is still there and yes we know the possible effect of this one if the price becomes more overpriced, tendency are it will create another drop in value and even if those companies will buy many properties, they can’t still cover the whole market.
The problem is that building a new one requires a lot of money, between costs of the resources, the transportation, the worker's salaries, and many other smaller stuff, all of that comes down to more expensive than just 2 years ago before the pandemic started. So, when the building of a new one is costly, that means the new homes will cost a lot more, and that makes the people who own older ones increase their prices as well.
Combine that with the fact that majority of the houses are owned by people who own 2 or more houses, that means people are buying houses even if they will not use it, even if it means they won't rent it to someone, they just do it as investment and hold it there. Both these cause it to go up a lot.
Combine that with the fact that majority of the houses are owned by people who own 2 or more houses, that means people are buying houses even if they will not use it, even if it means they won't rent it to someone, they just do it as investment and hold it there. Both these cause it to go up a lot.
There is a school of thought which claims real estate can serve as an inflation protected asset due to market prices scaling to match or exceed inflation. The APR on home loans can also appreciate at a rate slower than inflation if 8% is maintained. Which could actually make the loan cheaper over time.
Moody's by contrast is bearish on real estate and recommends waiting a few years before buying. There was also a big property tax hike for the united states in 2021, which makes buying and HODLing real estate more difficult. Immigration numbers suggest demand for living space should continue to increase, which could drive markets higher.
Its difficult to get accurate predictions and information, in ways we're in uncharted waters and no one is really certain what to expect.
It's always interesting to see how different markets are performing and these are some good insights into how America is doing right now. It seems kinda inevitable that a bubble would grow again with all the super cheap money that government policy introduced into the market, it's obscene to think that people were getting one percent mortgages as recently as a year ago - you'd have to be stupid not to take advantage and stretch to the limits. However it is just "easy" and populist policies that continued through Covid but should have been cut back years ago.
The fact is it's a problem, people recognize it but no one is going to do anything to correct it because the land owners are going to be benefited heavily after they sell their property, the management is dying and people have to either rent or find other alternatives which again is super expensive as well. The well developed countries are seeing such problems but the countries which are still developing are not seeing that much increase in the price, therefore I do think it might lead to reverse immigration because having a house is important for some people, this could create probelms not just for us but for the future generations as well if not resolved on time.
It's a global problem right now. Home prices are becoming unaffordable due to the high demand, high inflation and limited supply. Same situation in Singapore, Hongkong, Mumbai, Shanghai etc. Every major city is facing the issue.
This madness increase by manifold during the covid time because the loan was quite cheaper everywhere. Now that the prices are rising and the rental yield is stagnant, it's highly likely for many people to give us the properties to lending companies. That may cause another 2008 like crisis.
Yes, this isn't with USA alone. It is an universal problem, every cities experience similar problem. The major reason why properties were overvalued, all because of the demand. Almost in every country the development is stagnant over the cities.This madness increase by manifold during the covid time because the loan was quite cheaper everywhere. Now that the prices are rising and the rental yield is stagnant, it's highly likely for many people to give us the properties to lending companies. That may cause another 2008 like crisis.
Stagnant development makes people from the rural regions move towards the cities for employment and other needs. This makes the increase in demand for the limited availability of living space. This should not happen, corporate networks should widen the employment opportunities to the rural regions. This will make people to be in their homeland than moving to cities.
https://slate.com/business/2021/06/blackrock-invitation-houses-investment-firms-real-estate.html
There are also investment firms that are buying up houses well above market rate which is creating a bubble on its own. This wouldn't be an issue if a private firm wants to incur the risk of paying above market rates except for the potential government bailout in the event of a collapse. Firms like Blackrock haven't bought up enough real estate yet to create any sort of sizeable impact on the market, but if you're living in these communities and having billion dollar corporations buy out single family homes, you don't have a way to compete.
There are also investment firms that are buying up houses well above market rate which is creating a bubble on its own. This wouldn't be an issue if a private firm wants to incur the risk of paying above market rates except for the potential government bailout in the event of a collapse. Firms like Blackrock haven't bought up enough real estate yet to create any sort of sizeable impact on the market, but if you're living in these communities and having billion dollar corporations buy out single family homes, you don't have a way to compete.
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Moody's by contrast is bearish on real estate and recommends waiting a few years before buying. There was also a big property tax hike for the united states in 2021, which makes buying and HODLing real estate more difficult. Immigration numbers suggest demand for living space should continue to increase, which could drive markets higher.
I think that the term "HODLing'' must be referred to the cryptocurrency world only(especially Bitcoin).We must not use this term,when it comes to other financial assets and real estate.
American real estate used to be the original HODL.
Prior to the 2008 subprime mortgage crash, many believed the price of real estate could never diminish. Due to no one in the industry remembering a time when prices declined.
They call it a "real estate crisis". But the actual issue has much to do with lack of wage growth making it difficult for consumers to afford becoming home owners. It may more accurately be defined as a crisis of wealth and wage inequality as CEO wage growth has consumed the pay raises which would traditionally go to average workers.
I also don't think that illegal immigrants can apply for a mortgage.
There are government programs which offer home loans to those who cannot qualify for a typical mortgage.
Government student loans were offered to homeless living on the streets to inflate the earnings of for profit universities. (Part of how the student loan bubble became so big)
There are many immigrants in the country illegally who work and pay taxes sufficient to qualify for a home loan (I would guess) although I haven't seen stats on it.
It's a global problem right now. Home prices are becoming unaffordable due to the high demand, high inflation and limited supply. Same situation in Singapore, Hongkong, Mumbai, Shanghai etc. Every major city is facing the issue.
This madness increase by manifold during the covid time because the loan was quite cheaper everywhere. Now that the prices are rising and the rental yield is stagnant, it's highly likely for many people to give us the properties to lending companies. That may cause another 2008 like crisis.
This madness increase by manifold during the covid time because the loan was quite cheaper everywhere. Now that the prices are rising and the rental yield is stagnant, it's highly likely for many people to give us the properties to lending companies. That may cause another 2008 like crisis.
Quote
Moody's by contrast is bearish on real estate and recommends waiting a few years before buying. There was also a big property tax hike for the united states in 2021, which makes buying and HODLing real estate more difficult. Immigration numbers suggest demand for living space should continue to increase, which could drive markets higher.
I think that the term "HODLing'' must be referred to the cryptocurrency world only(especially Bitcoin).We must not use this term,when it comes to other financial assets and real estate.
Waiting a few years before buying won't change anything.The real estate bubble in the US won't burst soon.Even if it does,this will be temporary and a new real estate bubble will begin to accumulate.
I don't think that immigration has anything to do with pumping the real estate prices.Most immigrants are lacking enough money to buy a house and I also don't think that illegal immigrants can apply for a mortgage.The real reason behind the real estate bubble is the Federal Reserve's monetary policy.The interest rates have to go up.This will cool down the real estate market for sure.
I think there is one more factor that is not considered in the analysis above which can affect the conclusion. With few years, per capita population is also rising. Most of the time people tend to move or reside near to the existing colonisation or to the costal areas. This creates more and more demand in that area leading to hiked prices.
Definitely, they might be little over the government valuations but market rates will always demand far more because that’s also one sort of business.
We know that already inflation is at its peak, that affects the whole market stream whether it’s health care or real estate!
Definitely, they might be little over the government valuations but market rates will always demand far more because that’s also one sort of business.
We know that already inflation is at its peak, that affects the whole market stream whether it’s health care or real estate!
we know that the real estate sector is already in a bubble and waiting to burst.. most of the developers offer their property prices above normal prices and coupled with the declining American economy as a result of the pandemic and also the ukraine war, this has further aggravated the condition of the real estate sector in the country
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Home values in 97% of U.S. cities are overvalued, and real estate in some of the most overpriced regions could fall by 10% over the next few years, according to Moody's Analytics.
The pandemic has boosted home prices in parts of the country far beyond the typical coastal hot spots, Moody's chief economist Mark Zandi said in a new analysis. The most overpriced city in the nation is Boise, Idaho, which became a magnet for technology workers who wanted to relocate from pricey California cities when their offices shut due to the pandemic. By Moody's reckoning, Boise's homes are 73% overvalued, making it the most overpriced city in the nation.
The analysis may raise concerns for homebuyers, especially in regions where real estate prices have enjoyed rapid gains during the pandemic. At the same time, buyers face a double-whammy of high housing prices and rapidly rising mortgage rates, with the latter adding thousands of dollars to the annual cost of a home.
Cities in the South and Mountain West, which have seen an influx of buyers during the pandemic, could suffer a 10% drop in housing prices during the next several years, Zandi predicted.
"It probably makes sense to wait a year or two if you are able," he said in an email to CBS MoneyWatch. "House prices will be lower in the most overpriced markets, and there will be more housing inventory to choose from."
Zandi added, "Of course, it won't be a slam-dunk better market to purchase a home if you need a mortgage, as mortgage rates will likely be higher."
The economist said a given housing market is considered overvalued if property costs in the area are "well above" the historical relationship between home prices and incomes, rents and construction costs.
That may explain why smaller cities like Boise are at the top of the list of overvalued home markets, rather than notoriously expensive cities like New York. Housing may be pricier on a per-foot basis in New York or San Francisco, but workers there typically have higher incomes and can support higher costs.
Locals in Boise are now competing with buyers from San Francisco and other big cities, who often have more money to spend on housing. That is driving up prices beyond the reach of many people earning a typical salary in those regions.
Nashville, where Moody's estimates homes are 48% overvalued, is one of those cities experiencing the pain of rapid price escalation. Realtor Shane Tallant told CBS News that new property listings under $700,000 generate frenzies, with often more than a dozen offers within 24 hours.
Soaring real estate prices in Nashiville are forcing out some businesses and consumers. The Little Pantry That Could, which provides food assistance to people in need, was forced to close because its five-year lease wasn't renewed in a neighborhood where investors are buying properties.
"I don't feel like it's my fault, but yeah, of course, it's clear we're letting them down," Stacy Downey, the executive director of the pantry, told CBS News.
"Rock and a hard place"
The nation's most overvalued cities aren't the usual suspects. After Boise, the second-most overpriced market is Sherman-Denison, Texas, near the Dallas-Fort Worth area, where homes are valued 60% above what fundamentals would suggest. Its population has grown by double-digits for two decades as people relocated to Texas from other regions. The third most overpriced city is Muskegon, Michigan, where housing is 59% overvalued, Moody's found.
Homebuyers are "stuck between a rock and a hard place," especially first-time purchasers, noted Jeff Tucker, senior economist at Zillow.
On the one side are surging home prices and mortgage rates, but on the flip side are skyrocketing rents, he pointed out. The monthly rent in the nation's 50 largest cities rose an average of 14% in 2021, adding to the financial pressure facing many Americans. That's fueling an interest in buying because purchasers can at least lock in a stable monthly mortgage payment, even if they'll be paying more than a year ago, Tucker noted.
The nation's high housing valuations are raising questions about whether the housing market is facing another bubble, like the one in 2006 that fueled the Great Recession. Yet such concerns are likely misplaced, Tucker said.
"There are a lot of stark differences with the mid-2000s," he said. "For one thing, rents are rising very rapidly, and the credit of all the recent homebuyers is really strong."
That might protect against a repeat of the housing bust, but it may not assuage homebuyers' fears of overpaying. House-hunters should examine their budgets to figure out if they can afford the purchase, with the guiding principle being to spend no more than one-third of gross income on housing costs, including mortgage, property tax, insurance and maintenance, experts say.
Tucker also recommends asking whether a prospective buyer would be happy to live in the home for several years.
"The classic rule of thumb is five years" to hold onto a property, he said. "If the answers to those questions are yes, then I think there is a good argument for forging ahead to buy that house."
He added, "The other important question is 'Where else would I be living, and how much would that cost?'"
https://www.cbsnews.com/news/home-house-prices-mortgage-rates-moodys-mark-zandi/
The pandemic has boosted home prices in parts of the country far beyond the typical coastal hot spots, Moody's chief economist Mark Zandi said in a new analysis. The most overpriced city in the nation is Boise, Idaho, which became a magnet for technology workers who wanted to relocate from pricey California cities when their offices shut due to the pandemic. By Moody's reckoning, Boise's homes are 73% overvalued, making it the most overpriced city in the nation.
The analysis may raise concerns for homebuyers, especially in regions where real estate prices have enjoyed rapid gains during the pandemic. At the same time, buyers face a double-whammy of high housing prices and rapidly rising mortgage rates, with the latter adding thousands of dollars to the annual cost of a home.
Cities in the South and Mountain West, which have seen an influx of buyers during the pandemic, could suffer a 10% drop in housing prices during the next several years, Zandi predicted.
"It probably makes sense to wait a year or two if you are able," he said in an email to CBS MoneyWatch. "House prices will be lower in the most overpriced markets, and there will be more housing inventory to choose from."
Zandi added, "Of course, it won't be a slam-dunk better market to purchase a home if you need a mortgage, as mortgage rates will likely be higher."
The economist said a given housing market is considered overvalued if property costs in the area are "well above" the historical relationship between home prices and incomes, rents and construction costs.
That may explain why smaller cities like Boise are at the top of the list of overvalued home markets, rather than notoriously expensive cities like New York. Housing may be pricier on a per-foot basis in New York or San Francisco, but workers there typically have higher incomes and can support higher costs.
Locals in Boise are now competing with buyers from San Francisco and other big cities, who often have more money to spend on housing. That is driving up prices beyond the reach of many people earning a typical salary in those regions.
Nashville, where Moody's estimates homes are 48% overvalued, is one of those cities experiencing the pain of rapid price escalation. Realtor Shane Tallant told CBS News that new property listings under $700,000 generate frenzies, with often more than a dozen offers within 24 hours.
Soaring real estate prices in Nashiville are forcing out some businesses and consumers. The Little Pantry That Could, which provides food assistance to people in need, was forced to close because its five-year lease wasn't renewed in a neighborhood where investors are buying properties.
"I don't feel like it's my fault, but yeah, of course, it's clear we're letting them down," Stacy Downey, the executive director of the pantry, told CBS News.
"Rock and a hard place"
The nation's most overvalued cities aren't the usual suspects. After Boise, the second-most overpriced market is Sherman-Denison, Texas, near the Dallas-Fort Worth area, where homes are valued 60% above what fundamentals would suggest. Its population has grown by double-digits for two decades as people relocated to Texas from other regions. The third most overpriced city is Muskegon, Michigan, where housing is 59% overvalued, Moody's found.
Homebuyers are "stuck between a rock and a hard place," especially first-time purchasers, noted Jeff Tucker, senior economist at Zillow.
On the one side are surging home prices and mortgage rates, but on the flip side are skyrocketing rents, he pointed out. The monthly rent in the nation's 50 largest cities rose an average of 14% in 2021, adding to the financial pressure facing many Americans. That's fueling an interest in buying because purchasers can at least lock in a stable monthly mortgage payment, even if they'll be paying more than a year ago, Tucker noted.
The nation's high housing valuations are raising questions about whether the housing market is facing another bubble, like the one in 2006 that fueled the Great Recession. Yet such concerns are likely misplaced, Tucker said.
"There are a lot of stark differences with the mid-2000s," he said. "For one thing, rents are rising very rapidly, and the credit of all the recent homebuyers is really strong."
That might protect against a repeat of the housing bust, but it may not assuage homebuyers' fears of overpaying. House-hunters should examine their budgets to figure out if they can afford the purchase, with the guiding principle being to spend no more than one-third of gross income on housing costs, including mortgage, property tax, insurance and maintenance, experts say.
Tucker also recommends asking whether a prospective buyer would be happy to live in the home for several years.
"The classic rule of thumb is five years" to hold onto a property, he said. "If the answers to those questions are yes, then I think there is a good argument for forging ahead to buy that house."
He added, "The other important question is 'Where else would I be living, and how much would that cost?'"
https://www.cbsnews.com/news/home-house-prices-mortgage-rates-moodys-mark-zandi/
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There is a school of thought which claims real estate can serve as an inflation protected asset due to market prices scaling to match or exceed inflation. The APR on home loans can also appreciate at a rate slower than inflation if 8% is maintained. Which could actually make the loan cheaper over time.
Moody's by contrast is bearish on real estate and recommends waiting a few years before buying. There was also a big property tax hike for the united states in 2021, which makes buying and HODLing real estate more difficult. Immigration numbers suggest demand for living space should continue to increase, which could drive markets higher.
Its difficult to get accurate predictions and information, in ways we're in uncharted waters and no one is really certain what to expect.
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