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RTC vs. the current housing crisis. Huge profits were made in the wake of the RTC crisis two decades ago. Will residential real estate experience a similarly dramatic turnaround?
I was only a whipper snapper back then so what’s RTC?
No doubt there'll be a lot of opinion on this, but my opinion is that it won't be anything like what we had in the recession. You can have a look at the economic outlook pieces available with ANZ to see what they have to say about the matter.
My thoughts are it won'r be as worse because:
- Monetary policy very different now to what is was 20 years ago.
- Government has seen what has happened in the past and will do what it can to avoid this situation again.
- Population growth vs Home construction and there is a massive undersupply in homes, whereas 20 years ago it was almost an oversupply
- Higher rates are slowing the market but rates are still at what we would call long range “normal levels”.
- Even though clearance rates are low, we're seeing investors take up the slack from the drop-off in first time buyers.
- Home “upgraders” are still active and should remain so.
Viewing 3 posts - 1 through 3 (of 3 total)
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