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One Simple Reason House Prices Are Skyrocketing

 What The Real Estate Industry Won’t Tell You [An earlier version of this piece appeared in Forbes.com and got over 300,000 views!] For more than two years house prices have been increasing faster in metro Phoenix than in any other city in the S&P/CoreLogic Case-Shiller Home Price Index. The median single-family house price in metro Phoenix increased $100,000 in 2021 and is continuing to increase crazy fast in 2022, according to Phoenix MLS data.  #1 Reason For Skyrocketing House Prices Almost everyone agrees the main culprit causing our skyrocketing house prices in Phoenix and the United States is the extremely low number of houses for sale. What we don’t agree on is…

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Ivy Zelman: “I Think We’re at a Peak”

 “I think that there’s risk that these investors are being misled.” Ivy Zelman became famous on Wall Street when she correctly called the housing market top in 2005… and almost lost her Wall Street job because of it. She created her own company and then correctly called the housing market bottom in 2012. After that, she was bullish on housing until last year.  Last summer, her housing market research and investment banking firm, Zelman & Associates, came out with a bearish report that cemented her reputation as one of the most independent – and sometimes most contrarian – housing market analysts in the U.S. housing industry. Her disagreement with the…

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Real U.S. House Prices Up 10% in 12 Months – Case-Shiller

 Note. November 2021 data is the latest available from Case-Shiller as I write this on January 25, 2022. The data is a 3-month moving average so what they call November is really the September-November average. Click on images to see full-size, interactive versionsSee all 20 Case-Shiller graphs. USA – Up 19% U.S. 12-month house price appreciation peaked at 20% in August, the highest since at least 1988 which is the earliest Case-Shiller data. The 12-month price increase in November at 19% was still way above the 14% gains in September 2005 which was the peak of the Great Real Estate Bubble. New Record Home Price Appreciation (12-mo. Nominal) 3 metros set new appreciation records – at…

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Far Faster Free-and-Clear Home Ownership Proposed by 5 Democratic Senators

 Five U.S. Senators introduced a bill in September to create a new program to help lower-income, first-generation, first-time home buyers. Instead of giving first-time home buyers a $15,000 tax credit like the Biden campaign proposed last year, this new proposal would make mortgages 10 years shorter. Home buyers in this program could borrow the same amount of money but they would pay off their mortgages in 20 years instead of 30 years – with roughly the same monthly payments. The program would not drive up house prices for all future home buyers like a $15,000 tax credit would. The Democratic senators call it the Low-Income First Time Homebuyers Act, or…

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House Prices Up More Than In 2005!

 Case Shiller Home Price Index – August 2021 Update Note. June 2021 data is the latest available from Case-Shiller as I write this on August 31, 2021. The data is a 3-month moving average so what they call June is really the April-June average. See all 20+ Case-Shiller graphs.

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Why Did Condo Prices Skyrocket?

 If Covid permanently shifted housing demand toward larger houses with more outdoor living space, shouldn’t condo price increases have lagged far behind single-family house price increases? Metro Phoenix Median Sale Price in April (YoY) That doesn’t support the theory that Covid changed housing demand and caused the Spring 2021 real estate mania. Covid may certainly have triggered the mania but it certainly wasn’t because Covid shifted demand away from condos and toward single-family houses. Market Disruption Followed by Price Inertia Maybe Covid mainly just temporarily disrupted the market and that triggered sharp price increases. The temporary sharp price increases, however, made people think there would be more sharp price increases…

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