Best of the Week
Most Popular
1. Investing in a Bubble Mania Stock Market Trending Towards Financial Crisis 2.0 CRASH! - 9th Sep 21
2.Tech Stocks Bubble Valuations 2000 vs 2021 - 25th Sep 21
3.Stock Market FOMO Going into Crash Season - 8th Oct 21
4.Stock Market FOMO Hits September Brick Wall - Evergrande China's Lehman's Moment - 22nd Sep 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
7.AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
8.Why Silver Price Could Crash by 20%! - 5th Oct 21
9.Powell: Inflation Might Not Be Transitory, After All - 3rd Oct 21
10.Global Stock Markets Topped 60 Days Before the US Stocks Peaked - 23rd Sep 21
Last 7 days
CATHY WOOD ARK GARBAGE ARK Funds Heading for 90% STOCK CRASH! - 22nd Jan 22
Gold Is the Belle of the Ball. Will Its Dance Turn Bearish? - 22nd Jan 22
Best Neighborhoods to Buy Real Estate in San Diego - 22nd Jan 22
Stock Market January PANIC AI Tech Stocks Buying Opp - Trend Forecast 2022 - 21st Jan 21
How to Get Rich in the MetaVerse - 20th Jan 21
Should you Buy Payment Disruptor Stocks in 2022? - 20th Jan 21
2022 the Year of Smart devices, Electric Vehicles, and AI Startups - 20th Jan 21
Oil Markets More Animated by Geopolitics, Supply, and Demand - 20th Jan 21
Fake It Till You Make It: Will Silver’s Motto Work on Gold? - 19th Jan 22
Crude Oil Smashing Stocks - 19th Jan 22
US Stagflation: The Global Risk of 2022 - 19th Jan 22
Stock Market Trend Forecast Early 2022 - Tech Growth Value Stocks Rotation - 18th Jan 22
Stock Market Sentiment Speaks: Are We Setting Up For A 'Mini-Crash'? - 18th Jan 22
Mobile Sports Betting is on a rise: Here’s why - 18th Jan 22
Exponential AI Stocks Mega-trend - 17th Jan 22
THE NEXT BITCOIN - 17th Jan 22
Gold Price Predictions for 2022 - 17th Jan 22
How Do Debt Relief Services Work To Reduce The Amount You Owe? - 17th Jan 22
RIVIAN IPO Illustrates We are in the Mother of all Stock Market Bubbles - 16th Jan 22
All Market Eyes on Copper - 16th Jan 22
The US Dollar Had a Slip-Up, but Gold Turned a Blind Eye to It - 16th Jan 22
A Stock Market Top for the Ages - 16th Jan 22
FREETRADE - Stock Investing Platform, the Good, Bad and Ugly Review, Free Shares, Cancelled Orders - 15th Jan 22
WD 14tb My Book External Drive Unboxing, Testing and Benchmark Performance Amazon Buy Review - 15th Jan 22
Toyland Ferris Wheel Birthday Fun at Gulliver's Rother Valley UK Theme Park 2022 - 15th Jan 22
What You Should Know About a TailoredPay High Risk Merchant Account - 15th Jan 22
Best Metaverse Tech Stocks Investing for 2022 and Beyond - 14th Jan 22
Gold Price Lagging Inflation - 14th Jan 22
Get Your Startup Idea Up And Running With These 7 Tips - 14th Jan 22
What Happens When Your Flight Gets Cancelled in the UK? - 14th Jan 22
How to Profit from 2022’s Biggest Trend Reversal - 11th Jan 22
Stock Market Sentiment Speaks: Are We Ready To Drop To 4400SPX? - 11th Jan 22
What's the Role of an Affiliate Marketer? - 11th Jan 22
Essential Things To Know Before You Set Up A Limited Liability Company - 11th Jan 22
Fiscal and Monetary Cliffs Have Arrived - 10th Jan 22
The Meteoric Rise of Investing in Trading Cards - 10th Jan 22
IBM The REAL Quantum Metaverse STOCK! - 9th Jan 22
WARNING Failing NVME2 M2 SSD Drives Can Prevent Systems From Booting - Corsair MP600 - 9th Jan 22
The Fed’s inflated cake and a ‘quant’ of history - 9th Jan 22
NVME M2 SSD FAILURE WARNING Signs - Corsair MP600 1tb Drive - 9th Jan 22
Meadowhall Sheffield Christmas Lights 2021 Shopping - Before the Switch on - 9th Jan 22
How Does Insurance Work In Europe? Find Out Here - 9th Jan 22
Effect of Deflation On The Gold Price - 7th Jan 22
Stock Market 2022 Requires Different Strategies For Traders/Investors - 7th Jan 22
Old Man Winter Will Stimulate Natural Gas and Heating Oil Demand - 7th Jan 22
Is The Lazy Stock Market Bull Strategy Worth Considering? - 7th Jan 22
What Elliott Waves Show for Asia Pacific Stock and Financial Markets 2022 - 6th Jan 2022
Why You Should Register Your Company - 6th Jan 2022
4 Ways to Invest in Silver for 2022 - 6th Jan 2022
UNITY (U) - Metaverse Stock Analysis Investing for 2022 and Beyond - 5th Jan 2022
Stock Market Staving Off Risk-Off - 5th Jan 2022
Gold and Silver Still Hungover After New Year’s Eve - 5th Jan 2022
S&P 500 In an Uncharted Territory, But Is Sky the Limit? - 5th Jan 2022

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

The Tiny House I Grew up Just Sold for $430k

Housing-Market / US Housing Aug 11, 2021 - 03:11 PM GMT

By: Stephen_McBride

Housing-Market  “$430,000 for THAT?”

My colleague nearly spat coffee on his laptop when I showed him the house my mom just sold.

It’s the white door on the right:

This was the house I grew up in. It gets damp and moldy in the winter. The walls have water damage. The paint is peeling.

And it’s tiny—with two rooms upstairs and two rooms downstairs. It measures just 678 sq. ft.

It’s not in some swanky Beverly Hills-style neighborhood, either. A few murders take place on the surrounding blocks every year. It’s the type of place where “the Pitbulls go around in pairs,” as my grandad would say.

Yet… it sold for close to half a million bucks!
  • Is housing a giant bubble again?

Housing isn’t only booming in Ireland. US housing is on fire too.

In June, US home prices rose at their fastest rate in 34 years, according to S&P Global. The average home for sale was snapped up in just 17 days, a record low.

This boom won’t come as a surprise to longtime RiskHedge readers. We started talking about it and investing in it back in early 2019.

But now, Americans are getting nervous that home prices are rising even faster than before the 2008 crash.

The ‘08 bust was one of the most financially disruptive events of the century. Housing is what I call a “hot stove” investment. It burned a whole generation of Americans, and they’ll be damned if they ever touch that stove again.

  • But this boom is nothing like ‘08...

Remember NINJA mortgages?

Banks handed out roughly $3 trillion to folks with no income, no job, and no assets leading up to 2008.

You don’t see any of this silliness today.

This year, three in every four mortgage borrowers have super-prime credit scores. In other words, FICO scores above 760.

Unlike last time, this boom isn’t built on sand. It’s built on granite. And it’s being driven by a historic housing shortage that won’t be resolved for years...

New analysis by the National Association of Realtors (NAR) shows we need 6.4 million new homes just to meet current demand.

In fact, NAR data shows there are just 1.25 million homes for sale across the US. That’s one of the lowest readings since it started tracking data 40 years ago. It would take just two and a half months to sell every home on the market.

The CEO of Tricon Residential, who runs one of the largest pools of US rental homes, recently told the Wall Street Journal“We get 6,000 calls a week for a home and we’ve only got 200 available.”

  • Now a record number of house hunters are rushing into the market.

Today’s young adults, as you probably know, are called Millennials. They’re the largest generation in US history, bigger even than Baby Boomers.

And they’re hitting prime homebuying age right now.

Take a look at what I call “the most important chart in housing.” It breaks down homeownership in America by age:

The percentage of “kids” who owned a home collapsed to record lows last decade. But now, that percentage is recovering as a tidal wave of young folks are buying their first homes.

Millennials now make up the largest share of homebuyers for the first time ever, according to NAR.

In other words, the largest generation in history is piling into the housing market... at a time when there’s a record shortage of homes to buy.

This is why US housing is smashing every record in the books.

Millennials alone could snap up at least 15 million homes in the next decade, according to mortgage specialist First American Financial.

  • Let me be clear: this is the healthiest housing boom ever.

It’s nerve-wracking to watch home prices rise at their fastest pace in decades.

After living through ‘08, we’re all waiting for it to crash again.

But this isn’t another debt-fueled binge. As housing expert Barry Habib told me last year, ”The most important driver of home prices is supply and demand.”

Today, supply is tighter than it’s ever been. And with record numbers of house hunters entering the market, it all but guarantees the housing boom has years left to run.

  • I’m pounding the table on homebuilder stocks.

My research suggests you can at least double your money in builder stocks in the coming years.

Many homebuilders went bust when the market turned in ‘08. Many more had near-death experiences. This seared one thing into their minds: Don’t overbuild EVER again.

The number of new home starts recently jumped to their highest level since 2006. But builders are still being super cautious. They’re putting up just enough homes to meet demand rather than risk flooding the market.

New data from top real estate analysis firm John Burns shows the number of finished homes collapsed 82% over the past year.

Builders are in control of the most sought-after good in America today: homes.

This is frustrating buyers, but it’s great for homebuilders. A record shortage of homes at a time when millions of first-time buyers are rushing to buy… all but guarantees housing will boom for the next decade.

The Homebuilders ETF (XHB) has doubled since I first wrote about this opportunity in early 2019.

But the best is yet to come for this group. Now is a great time to buy XHB if you don’t already own it.

The Great Disruptors: 3 Breakthrough Stocks Set to Double Your Money"
Get my latest report where I reveal my three favorite stocks that will hand you 100% gains as they disrupt whole industries. Get your free copy here.

By Stephen McBride

© 2021 Copyright Stephen McBride - All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

© 2005-2019 - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.

Post Comment

Only logged in users are allowed to post comments. Register/ Log in