The Next Housing Crash will be Catastrophic - Prepare Now!
Updated
American and international corporations are keeping a large number of properties off the market as investments. These unoccupied flats limit supply in sought locations, creating an artificial scarcity as a result of central bank policies that finally caused an Everything Bubble. The number of corporate purchases of houses has increased dramatically. This has fueled demand in market, but if rental income fall as a result of the recession, corporate purchasers will start liquidating those same assets.
As mortgage rates are rising, people are having a difficult time to allocate their income towards mortgage payments especially in times where rising food inflation is also a major problem for majority of Americans and if unemployment rates goes slightly higher then mortgage default will occur on a national scale, leading to another catastrophic housing crisis.
In one of our previous analysis we stated, how inflation will peak at 12% and in case of a recession it is certain that inflation will stay on it's trajectory to peak while, Home prices will start correcting.
Demand and Supply comparison between U.S Population growth and overall Nonfarm payroll employees against total housing unit supply
Listing count of houses actively on sale have increased significantly in June by 18.74%
According to the MBA's Refinance Mortgage Applications Index, applications for mortgages refinance fell 5.7% in June and have fallen by 70% year on year to the lowest level since 2000.
PPI for Construction material have increased by almost 50% since 2021, forcing builders to shrink margins by 10-12%
Conclusion: Since owning a home is becoming increasingly costly, it is prudent to rent one because real estate prices will soon begin to correct.
NOTE: Cost of Farmland which have adequate water supply will continue rising due to current geopolitical situation.
To leave this analysis on a positive note, We have picked an undervalued stock for you,
Unity Software Inc. (NYSE:U) Looking at the future, their is one aggressive company that should be in every tech growth investor's portfolio which have the potential to outpace market, Unity Game engine can render ultra-realistic graphics, The next decade will of The uncanny valley and unity software plays a major role in it, Unity software are down 70% this year and trading 40% below their IPO value, The stock is currently at discount and from a long-term prospective and we believe that it will provide 80% return within 24 months making it a best buying opportunity.
To this wonderful community,
Be safe and be prepared,
Thank you. ❤️
As mortgage rates are rising, people are having a difficult time to allocate their income towards mortgage payments especially in times where rising food inflation is also a major problem for majority of Americans and if unemployment rates goes slightly higher then mortgage default will occur on a national scale, leading to another catastrophic housing crisis.
In one of our previous analysis we stated, how inflation will peak at 12% and in case of a recession it is certain that inflation will stay on it's trajectory to peak while, Home prices will start correcting.
Demand and Supply comparison between U.S Population growth and overall Nonfarm payroll employees against total housing unit supply
Listing count of houses actively on sale have increased significantly in June by 18.74%
According to the MBA's Refinance Mortgage Applications Index, applications for mortgages refinance fell 5.7% in June and have fallen by 70% year on year to the lowest level since 2000.
PPI for Construction material have increased by almost 50% since 2021, forcing builders to shrink margins by 10-12%
Conclusion: Since owning a home is becoming increasingly costly, it is prudent to rent one because real estate prices will soon begin to correct.
NOTE: Cost of Farmland which have adequate water supply will continue rising due to current geopolitical situation.
To leave this analysis on a positive note, We have picked an undervalued stock for you,
Unity Software Inc. (NYSE:U) Looking at the future, their is one aggressive company that should be in every tech growth investor's portfolio which have the potential to outpace market, Unity Game engine can render ultra-realistic graphics, The next decade will of The uncanny valley and unity software plays a major role in it, Unity software are down 70% this year and trading 40% below their IPO value, The stock is currently at discount and from a long-term prospective and we believe that it will provide 80% return within 24 months making it a best buying opportunity.
To this wonderful community,
Be safe and be prepared,
Thank you. ❤️
Comment
Housing prices that significantly outpace household income growth are not feasible, nor are housing prices that climbed mainly due to historically low mortgage rates. It's also evident that individuals who had accessed temporary wealth produced by central banks, have poured trillions into property internationally as a hedge against inflation, All of these causes aggravate false demand and scarcity, pushing home prices to an all time high. All of the gains are eventually erased, and if the system gets broken by this crash, Then prices will fall considerably below their prior levels.
Related publications
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.