House prices will rise historically in 2022.

Great news... :(

Bubble will burst eventually. Coupled with a struggling economy, leading to foreclosures, failure to pay mortgages, emerging lack of buying interest. They will go down. The institution intends to rinse a bunch of people who are holding onto money and keep the broke people struggling. It's all a system of class division. Sure the rich can still get richer, but the institution requires the vast majority to be either lower or middle class for their scheme to thrive. They don't want everyone getting rich amd thus you see economic recessions periodically.

Except people in America aren't the only ones driving in the strong real estate market. And there is still a lot of demand and limited supply. So, yeah, prices won't keep rising astronomically forever, but there will be no bursting bubbles.

We need to come up with reasons it will crash 40% in one year so that Jamin and Steve can buy at the price they want

Just like Millennials spending money on expensive avocado toast, if Jamin would give up overpriced beer in local pubs and Steve would stop paying for rub-and-tugs, then they could afford the down payment for a house.

They should combined their resources and buy a home together. Jamin can show Steve the the best Seattle dives where a cheap rub-and-tug can be had in the back alley. Not that jamin would ever partake of such a thing, but beer is less overpriced at dives.

There is no housing bubble. In order to have a housing bubble, you have to have excess supply. In 2008, housing starts had been over 1.5 mil a month for almost an entire decade with the last two years before the crash seeing housing starts at over 2 mil a month. Since 2008, it has taken a decade for housing starts to get back to 1.5 mil a month. During the same time frame (2008 to present), there has been a significant migration from small cities and rural areas to about two dozen major metro areas. Texas has added about 5 million people during that time frame. Unless there is a massive exodus from these major metros back to smaller cities and rural areas, you will not see any huge swings in real estate prices. In fact, what has been happening is sort of a pressure relief valve exodus from markets that have zero new inventory due to land barriers (San Fran, Sea, etc.). People are taking advantage of remote work to leave these massively expensive and inaccessible real estate markets and are going to places like Boise and Spokane. This is not causing a big drop in real estate prices in the overheated markets. Instead, it is causing prices to skyrocket in Boise, Spokane and even sleepy mountain towns like Grand Junction, CO.

There will definitely be a break in the run up on real estate prices due to higher interest rates, a lousy stock market, consumer inflation and probably a recession. But it won't last. As soon as the economy turns back around, prices will shoot up again. And there are so many people who have been pushed out of the market that any drop in prices will just bring people off the benches and into the market, meaning that prices will not be able to fall far.

Ok, fine. I'll play along. If I had to list what I think are the most convincing arguments for house prices continuing up at a much faster pace than their historical average, my list would be

* Baby Boomers with millions of dollars in retirement money will be shadow-funding their kids' home purchases (already happening).

* House prices in the U.S. are already quite affordable in comparison to other major Western nations. For example, median income to median house price in Canada is 1-to-8.

+1

A bubble implies there is actual supply (pro hint: there isn't)

Lol. Quantitative tightening hasn’t even started yet and the Fed must continue to raise rates (Wall Street current consensus is 8 more times) and Zillow thinks prices will rise? Talk about economically challenged.

You sound like the jerk off boomers who put $900 down on a home in CA in the 80s. Times have changed, old man 🖕

Not true at all. In the 1980s Tokyo had a real estate bubble where the price per squarefoot went to 135x the price in Manhattan.

Except for in a few markets, there is no bubble to burst.

The USA is awash in cash and thats not going to change.

House prices are still limited by the buyers ability to afford them.
And most people put a max 20% down and then have a mortgage payment that is a certain percent if their income or take home pay.

Rising interest rates will reduce affordability.

I realize a limited supply will push prices up.
But if people can’t afford to compete for houses, that will temper demand, which pushes prices down.
Unless there are more wealthy investors buying homes to rent them out.

Then there will be fewer owner occupied homes and more renters.
Or people staying out.
Or people renting out the house they own in order to move, and paying rent for the house they live in.
Or selling and using that equity to buy, but they lose a lot on selling fees.

In all ways, it looks rough for first time home buyers for a while.

As usual I agree with Precious Roy.
There is not enough housing build in the US for a very long time.

Keep in mind that the country is growing in population and everybody has to live somewhere.

npr.org

There's never been such a severe shortage of homes in the U.S. Here's why

Home prices rose nearly 20% last year, in large part because the U.S. is several million homes short of demand. Builders say the pandemic is partly to blame, but the problem goes deeper than that.

Link:www.npr.org/2022/03/29/1089174630/hous...

This guy is pretty smart:

reasons (my opinion) home prices will be flat/slight declines:

1) purchasing power w/ mortgage rates at 5-6%. e.g. a 3500/mo mortgage payment used to be able to afford $1M worth of house in January, 2022. Now that same monthly mortgage payment can only afford about $850K worth of house. Note: In some markets buyers (investors) are not all that sensitive to interest rates since they can pay cash (e.g. entry level fixer upper homes in San Francisco or Seattle or another uniquely expensive market. lower end of the market homes tend to hold value well even during downturn)

2) Rents going up during inflation period makes buying (instead of renting) more attractive, whether you're a renter (if you can afford to buy that is) or an investor

3) Cost of construction/labor and cost of building materials is still very high. Jamin may not understand why this matters, but this is important because developers have to profit from the housing they build somehow. Developers are not just going to build something and put it for sale at a discount/donation because they feel like Mother Theresa. Even when building new public housing developments they need to get paid somehow so it is worthwhile .

4) Land use and zoning is still a challenge in many areas - this restricts supply a great deal. I understand Minneapolis did away with single family zoning but expensive cities are not following their lead.

5) When most people buy a house, they plan to live there at least 5 years. They are buying it with the long term in mind, and to ride out any recession before they ever sell (unless they are forced to). Buying and selling real estate is not like day trading investments such as crypto where you're in and out in days and trying to time sh*t. Transaction costs in real estate are expensive.

the good news: historically recessions only last like 2 years

Who are the people that are buying these homes? Am I really that poor in my mid-30s still living in a 1brm apartment with my gf? Depressing.