Whether you “own” or rent in the U.S. or Canada the following articles from under the radar will enlighten you on what is going on with real estate these days.
The price gap between renting and owning based on dollar amounts ranges from approximately 48% on the high end to 30% on the low end. With the data below, potential homeowners can make more informed choices on where to settle down and which states will stretch their pennies furthest.
Global home prices are on the rise, and numbers from the International Monetary Fund (IMF), the monetary policy arm of the UN, show that Canada ranks amongst the top ten of all of their housing indicators. While that sounds like a good thing, the IMF generally warns that too much growth means overvaluation. Overvaluation requires a correction, and if it goes too high, even a crash.
The United States is starting to see a surge in foreign buying according to the National Association of Realtors (NAR). These numbers are showing explosive growth in both the transactions, and dollar volume.
If you’re from Canada and the U.S., chances are you’ll never see market capitulation. However, you’ll likely see many corrections, and maybe even a couple of crashes. Here are the definitions of the meanings of the words: correction. crash and capitulation.
…The Organisation for Economic Co-operation and Development (OECD) House Price-To-Rent Index, and a linear regression model…predicts Canadian real estate prices will fall 28% by 2020. Here are the details.
There are over 552,000 multi-millionaires, and 87% of them own a second home. The wealth analysts at New World Wealth (NWW) have compiled their annual report on second home buying by multi-millionaires, those with over US$10 million in assets. Old money cites (NY, Hong Kong, etc…) top the list for the most secondary homes held by this segment of buyers, but some interesting new cities are experiencing rapid growth.
The number of homes with negative equity in the U.S. is still high, but the numbers are improving. At the end of the first quarter in 2017, 3.1 million homes owed more on their mortgage than the home was worth. This number improved from the previous quarter, with 91,000 homes regaining equity. The total number of mortgages underwater in the U.S. still stands at 6.1%.
In the past few decades, the concept of home ownership has been completely turned on its head. Previously, homes were considered a very long-term consumption good…[No one] ever considered tripling the value of their homes by retirement time and selling them to move beachside yet, somehow along the way, this became a reasonable investment expectation. Even today, home buyers still make their purchases with the hopes of escalating prices. [It begs answers to these questions: Is a house just a home? Should a house be expected to behave like an investment? Is the housing game nothing more than a Ponzi scheme where the end buyer before the market corrects becomes the “greater fool”? Let’s try and answer those questions.]
The world will soon realise that all the assets that have been inflated to bubble levels will lose most of their value. Indeed, if we look at what could happen to house prices in real money (gold), the risk is such that buying a house today is likely to be a very costly and perhaps ruining experience.
Over long periods the inflation-adjusted price of homes in the U.S. has tended to increase by a little more than 1% per year. That doesn’t mean owning a home is a good way to make a 1% real return on your money though. This article explains why.
It is clear global real estate prices are heating up again and, due to interest rates being lower now than in the previous cycle, real estate prices in the U.S. and globally may actually surprise us with several more years of growth before they peak as global liquidity searches for the few relatively safe assets (in the least dirty shirt fashion) as a way to protect against reflation and devaluation in non-U.S. countries.
Guess where the hottest and weakest housing markets in the world are? Where are home prices growing faster than disposable personal income? It’s all here.
This post provides a visualization of data* from our new True Cost of Living Tool to illustrate how the living conditions of the working class stack up across the country. It’s kind of a big deal because it lets you drill down to a specific city and search through layers of relevant information to understand exactly how much money it takes to live in any given area.
Paying off the mortgage early is an idea with obvious appeal, but not one that many middle-class home “owners” pursue. If your interest rate is so good that the bank just made a bad bet in giving you that low rate, you might want to continue enjoying the benefits as long as possible. In many other circumstances, however, paying off the mortgage can be a fine money management move indeed. [Below are 10 sound reasons to do so.]
“Buy as much house as you can,” real estate agents urged clients. “The more you buy, the bigger your tax break” is their advice using the mortgage interest deduction (MID) to explicitly promote over-investment in housing. Unfortunately, such advice fueled the previous housing boom and exacerbated its bust and could do so again.
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