Posts filed under “Real Estate”
U.S. homeownership falls to the lowest levels in almost 20 years, blared the headlines. Lots of articles explained “Why Your Home is Not a Good Investment” and why Americans think owning a home is better for them than it is. It seems that America’s former love affair with real estate is over.
Blame the recency effect. People have a disconcerting tendency to give more weight to what just happened than long-term trends. This is why the monthly jobs report, a very rough estimate, has such an outsize impact on the markets. This same effect is what is driving people toward renting over buying.
A little context is needed.
Let me preface this by noting I was very bearish on U.S. residential real estate in the last decade. All the metrics — median income to median home price, cost of renting versus owning, residential real estate value relative to gross domestic product — showed an extremely overvalued market by two to three standard deviations. Before it was all over, economists Carmen Reinhart and Ken Rogoff argued that we were in a credit bubble and housing was due for a 35 percent crash. Continues here
This week, the New York Times launched The Upshot, combining aspects of the Washington Post’s Wonkblog with Nate Silver’s 538. Edited by Pulitzer Prize winner and former economics columnist David Leonhardt, we linked to the inaugural piece “America’s Middle Class Is No Longer the World’s Richest.” This morning, I want to direct your attention to…Read More
Hoisington Investment Management – Quarterly Review and Outlook, First Quarter 2014 John Mauldin April 23, 2014 In today’s Outside the Box, Lacy Hunt and Van Hoisington of Hoisington Investment have the temerity to point out that since the Great Recession officially ended in 2009, the Federal Open Market Committee (FOMC) has been consistently…Read More
Source: Calculated Risk I have heard a fair amount of chatter about the awful winter weather’s impact on home sales. Let’s clarify the different measures in use for New and Existing Home Sales to see what we can find. U.S. Census Bureau and the U.S. Department of Housing and Urban Development jointly release the…Read More
If you want to know what someone’s views of society are, ask what they believe is the best long-term investment. I am fascinated each year when Gallup Poll asks Americans to choose the best option among real estate, stocks and mutual funds, gold, savings accounts and CDs, or bonds. The results are a pop psychologist’s…Read More