When Bearishness is Bullish As the 2017 housing market officially gets underway, at least a few Realtors are dealing with Buyers haunted by the post-2008 housing crash — and the fear that something like that could happen again. How warranted are those fears? Housing Market Vital Signs: Checklist Unfortunately, bubbles are usually only obvious in retrospect...Read More
(Even) Lower Interest Rates vs. Weaker Economy “It’s too soon to tell.” –Chinese leader Mao Tse-tung, when asked — in 1948(!) — about the historical significance of the French Revolution. To accurately assess the potential effect of Brexit on the housing market, one must first identify and analyze the biggest variables. Here’s my take: Positives...Read More
Weighing Three Variables Homes on busy streets typically fetch a discount. Is there an equivalent discount for homes located across from a school? (which, in a way, is really just a subset of the “busy street” discount). I’ve never seen data on this, but I’d guess “yes.” I’d further speculate that the discount varies depending...Read More
Stock “Comp’s” vs. Housing “Comp’s” If you want to buy 100 shares of Google or Amazon, what are the comp’s? How much the last Buyer paid a fraction of a second ago. After all, stock is fungible: every share (at least common) is the same as every other. Nanoseconds vs. Weeks (Months?) Now, assume you...Read More
China’s Chickens Come Home to Roost** or, Is the Opposite of the “Wealth Effect” the “Poverty Effect??” Normally, I tell prospective home Buyers and Sellers to tune out “macro” factors like the broader economy, (un)employment, etc. and instead focus on “micro” factors affecting the specific property they want to buy or sell. So, forget about...Read More
When Bigger Isn’t Better Just like the discount for a one-car garage varies, so, too, does the discount for a home with no basement (at least in the Twin Cities housing market, where single family homes routinely come with — and Buyers expect — finished basements). The biggest variable driving the discount for no basement?...Read More
