Manage episode 328438430 series 2814073
Where Is the New Normal?
The news is very confusing these days. There are many contradictions. We hear talk of a bubble and runaway housing costs are met with Fed tightening and the end of the stimulus. We know Millenials are starting families, experiencing record-low unemployment and rising wages. And yet record inflation, supply chain problems, rising energy prices and rising commodity prices seem to add a level of uncertainty not seen in our lifetime. Oh, and robots will take our jobs, and we could experience world war. So, we are trying to separate the signal from the noise. This week we talk to a man who has been studying housing prices since founding his firm in 1986. We'll ask him which of those headlines matter most to the real estate market, and which of those factors we can largely ignore.
Can Housing Keep Rising?
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Our guest, Jonathan Miller, Founder of Miller Samuel Inc. provides appraisal services on roughly $5 billion worth of property per year in the New York City metropolitan area.
Mr. Miller is the author of a series of market reports considered the "report of record" covering New York, Connecticut, New Jersey, Long Island, Boston, Florida, Southern California, and Aspen. His reports are relied on by the Federal Reserve, the IRS, the US Department of Housing and Urban Development, the NYC Office of Management and Budget, and others.
- "A housing crash is unlikely, but a correction could be around the corner," says Business Insider, and "talk of a housing bubble has intensified amid surging housing costs...a crash is unlikely" https://www.businessinsider.com/housing-crash-unlikely-but-correction-is-probable-2022-5
- "Post Covid, Millennial Buyers Want Larger Homes World Property Journal" and "Millenials are now in favor of a larger home and home builders are responding" (https://www.worldpropertyjournal.com/real-estate-news/united-states/atlanta-real-estate-news/real-estate-news-national-association-of-home-builders-2022-housing-reports-millennial-housing-preferences-in-2022-jerry-konter-13040.php)
- "U.S. Home Sellers Beginning to Drop Asking Prices," says the World Property Journal and "suggesting that the seller's tight grip on the market is starting to loosen" (https://worldpropertyjournal.com/real-estate-news/united-states/los-angeles-real-estate-news/real-estate-news-redfin-2022-housing-reports-are-home-prices-beginning-to-decline-in-2022-daryl-fairweather-13054.php)
- "Toronto Home Prices Drop Most in Two Years as Rates Slam Market," says Bloomberg, and "higher borrowing costs start to bite in what has been one of the world's hottest markets" (https://www.bloomberg.com/news/articles/2022-05-04/toronto-home-prices-drop-most-in-two-years-as-rates-slam-market)
- "We're Having this Long-Term and Short-Term Transition to Remote Work says UCONN professor Thomas Cooke in our conversation with him on this show regarding why people are content to stay put. (https://www.buzzsprout.com/1444222/10314347-boroughs-burbs-46-tax-the-rich-they-won-t-move-a-conversation-on-migration-and-demographics)
- "Historic Home Affordability Issues Continue in 80 Percent of U.S. Markets," says Monsef Rachid, "up from just 38% of counties in the first quarter of 2021. Houses spiked 16% while wages rose just 7%. The 26.3% of wages to buy a home...highest point since 2008." (https://www.worldpropertyjournal.com/real-estate-news/united-states/irvine/real-estate-news-attom-data-first-quarter-2022-us-home-affordability-report-home-affordability-index-march-2022-rising-home-price-data-for-2022-rick-s-13049.php)
Roberto Cabrera's New York Market Report, "Are You Feeling Locked In? was released today and can be found at http://www.RobertoCabrera.com