The Next Housing Crash is Coming
Make sure to thank both the Democrats and the GOP when it explodes.
Party labels, Liberal or Conservative. It does not matter. The liars and hacks in Washington D.C. join ranks to protect their jobs and pump endless cash into the system to "stimulate" the economy.
Inflation? Debt crisis? Housing bubble? Who the fuck cares . . . as long as it happens after the election day 2014.
You heard it here first. A new, improved and maybe BIGGER housing bubble is building up. If history is any guide the exploding bubble should be a real clusterfuck.
“We’re deep into uncharted territory: Amazingly low mortgage rates, a razor-thin inventory of homes for sale, and the release of years’ worth of pent-up demand. Plus there’s a seemingly endless stream of investors and non-investors who pay cash and thereby avoid the loan-qualification process. How this all plays out is educated guesswork at this point. Understandably, speculation continues over whether another housing bubble is forming,” said John Walsh, DataQuick president.
Welcome to double digit home price increases funded by rivers of money printed by the Federal Reserve and Congress.
2013 California home prices when compared to 2012.
- +30.2% - Los Angeles County
- +24.1% - Orange County
- +22.9% - Riverside County
- +21.3% - San Diego County
- +28.1% - San Bernardino County
- +39.0% - Contra Costa County
- +26.8% - Marin County
- +25.7% - Santa Clara County
- +24.1% - San Francisco County
- +25.9% - San Mateo County
- +27.0% - Santa Barbara County
- +29.9% - Kern County
- +14.1% - Fresno County
- +32.9% - San Joaquin County
- +32.0% - Sacramento County
The massive run up in homes prices is not natural in an economy suffering high unemployment, under employment and job outsourcing to other nations.
What goes up must come down.
See more at DQ News.com
Some economic growth for California
- In spite of massive mismanagement by both parties and huge tax increases the Golden State still has a lot going for it. But national economic policy and the Federal Reserve is driving up housing prices and will crash them yet again just like in the 1990s and in 2006.
During the downturn, new home construction plummeted along with jobs and personal incomes. Today, a major forecast for the Sacramento region suggests these measures of economic health are poised to rise together over the next four years.
The Sacramento Bee reported that home building, an economic powerhouse in the region when it's in full swing, will return in force, rising to levels in line with population growth by 2017, according to the latest forecast by the University of the Pacific's Business Forecasting Center.
Still, Michael Strech, president of the North State BIA, said most builders agree the new home market is on track to recover.
"Collectively, the industry feels very confident that demand will continue and that this is a sustainable recovery," Strech said.
The latest projections from UOP's Business Forecasting Center provide a basis for guarded optimism.
Its May report for the four-county Sacramento region predicted sizable job growth over the next four years, along with falling unemployment. Personal incomes, adjusted for inflation, will eventually rise again at a rate faster than during the boom years, it said.
And population will increase by rates from 1 percent to 1.6 percent annually. In a region with about 2.2 million residents, that means adding 22,000 to 35,000 people a year.
Demand from those newcomers will help drive single-family housing starts from a low of about 2,000 a year in 2011 to a historically healthy level of 11,500 annually by 2017, the center predicts.
Michael said he also expects that many families who doubled up in the recession will strike out on their own and seek newly built homes. "Household formation has been slower than what it might have been because of the economy," Michael said. "As it improves, we should see people moving out of their parents' houses."
As home prices rise, and current homeowners regain equity, many will move, industry leaders said. Some might need a bigger house because their families have grown; others will want to downsize because their children have left.
"There are people stuck in homes," Norman said. "They've been waiting. Their life has changed. They want something different. Now they're free to make other choices."