Posts Tagged ‘housing’

Home Ownership No Longer A Safe Investment Option

Monday, August 23rd, 2010

Before the real estate bubble burst, a home was more than just a home – it was an investment.

  • For the past 50 years, homeowners have seen huge profits as their homes went up in value every year. It was relatively easy to buy low and sell high, so there was more money moving around in the housing market and the economy as a whole.
  • No more. Some experts predict that home values will now increase only by the rate of inflation – nowhere near the 10% increase many homeowners had been expecting every year.
  • Buying a home is now more of a risk than a definite reward. But not everyone has a dismal view. Housing is a necessary part of life, and in areas where there is a limited number of options, prices will have to keep up with demand.

Facts & Figures

  • Home sales are expected to have declined by 20% since last July.
  • $6 trillion in housing-related assets has been lost since 2005.
  • It will take at least 20 years for those losses to be regained, though it’s possible they never will.

Best Quote

“There is no iron law that real estate must appreciate.” – Stan Humphries, Chief Economist for Zillow (a real estate website)

Living In Walt Disney World

Thursday, June 24th, 2010

Walt Disney Co. plans to develop an expensive vacation-home real estate community – “Golden Oak” – in Walt Disney World in Florida.

  • Golden Oak homes will be priced between $1.5 and $8 million dollars, placing them at the very top of the Orlando area housing market.
  • Construction on the first homes is expected to be finished in 2011.
  • There is another real estate development next to the theme park – “Celebration” – that is more economically diverse and generally considered a successful project.

Facts & Figures

  • The average price of new home listings in the Orlando area in 2010 is about $243,000.
  • The proposed plan includes 450 homes, a 445-room Four Seasons hotel, 2 updated golf courses, a clubhouse, parks, walkways, and wetlands.

Best Quote

“This may be the first time that a kind of man-made entertainment center has generated that kind of real-estate activity.” – Elizabeth Plater-Zyberk, Dean of Architecture at the University of Miami

Housing Prices: How Low Can They Go?

Friday, June 12th, 2009

There are more markets than the stock and bonds ones and they are pretty important too. Housing markets are a key indicator of the economy’s health, so obviously you can’t pass it up.

  • Housing markets take longer to rebound after recessions even if other markets recover quickly.
  • Personal housing decisions don’t often follow the fluctuations of the housing market, but instead reflect personal and economic factors – the majority of people does not constantly sell or buy housing every time the price changes.
  • A significant upswing in the economy may reverse this downward trend, but it will most likely have little effect unless attitudes towards home ownership change significantly.

Facts & Figures

  • Prices have been declining for three years and are projected to fall 41% from 2006 through 2010.
  • Current market prices are encouraging people to sell their homes while not stimulating new demand for housing: a large supply with little demand.
  • Following the 1990-91 U.S. recession, housing prices didn’t move upwards till roughly six years later.