Had to double check the article date on this one. Reads like its straight out of 2000-2006 but alas it is not.
http://online.wsj.com/article/SB10001424127887324338604578327982067761860.html
Wouldn't get too excited. Sales are off a historically low base.
WE have the lowest interest rates around for yonks, the Fed buying $40 odd billion in RMBS every month, a juiced up economy and builders cutting every corner in the book along with lenders.
Sounds like a recipe for another property disaster.
Again I think it depends on where you are. I was in America a few months ago and I met with a developer in San Antonio Texas and asked him what were the greatest challenges and he stated housing blocks.
Now I said this is Texas plenty of land but he pointed out that there was a shortage of building blocks, because the banks will not fund land subdivision. The building companies will not do it because they do not have the funds in place to carry the subdivisions on their books.
States like Texas are very interesting, virtual no fall in prices since the GST they have the strongest jobs growth in America and a lot of people are moving to cities like San Antonio and Dallas. This is creating more demand in these sectors.
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Not excited. Government created bubbles don't do much for capitalism as a whole. Great for banksters though.
Why the heck are you two up at such ungodly hours, go to bed!
Freckle wrote:WE have the lowest interest rates around for yonks, the Fed buying $40 odd billion in RMBS every month, a juiced up economy and builders cutting every corner in the book along with lenders.Sounds like a recipe for another property disaster.
Absolutely.
Funny though as the article above points to a disparity between new builds and existing property. At least for the moment. The excess will spill into other markets in time.
I guess the observation is that the banks have finally started to lend out the stimulus money they were given. They had been holding it in reserve (and getting a spread on it for NOT lending it out) at the fed. Got too tempting it seems.
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