US Housing Market: Following 15 Years Of Boom-And-Bust, Is It Getting Back To Normal?
By Angelo Young | March 5, 2013 5:56 AM EST
The U.S. housing market has been in stabilization mode for only the past year or so following an eight-year run-up to the peak of the housing bubble in 2006 followed by what most homeowners who bought in that period know: a bursting of a massive speculative bubble that sent the nation into recession and millions of homebuyers into foreclosure.
But, according to a recent analysis of more than 380 U.S. housing markets, home prices have in recent months begun to resemble “something recognizable as normal,” said David Stiff, chief economist of Fiserv, Inc., a global provider of financial services technology. “For the past 15 years, home price changes and sales volumes have either been boosted by a bubble mentality or crushed by crash psychology.”
But the worst appears to be over – at least for this latest boom-and-bust cycle – and home prices are expected to grow 0.6 percent between the third quarter of last year to the third quarter 2013, according to an analysis by Fiserv based on the Case-Shiller Indexes and data from the Federal Housing Finance Agency. This growth is expected to pick up afterwards, by 3.7 percent in the following 12-month period and 3.3 percent on average between 2012 and 2017.
By comparison, from 1998 to 2006 home prices grew on average about 5 percent every year. Housing starts are at a historic low as bank-owned inventories remain high, something that also weighs on house prices. In essence, houses are cheaper now than they were in the run-up to the last speculative bubble, so it will take longer before homes reach double-digit appreciations that were a symptom of the last housing market collapse, according to Fiserv.
Global Luxury Real Estate Market At Record Highs
Christie’s International Real Estate recently looked at 10 of the world’s top property markets and found that the price for the world’s priciest homes has risen toward historic highs, fuelled by a scarcity of quality inventory coupled with a high demand from the world’s richest property buyers.
“With financial markets providing a limited return on investment, high-net-worth individuals are recognizing the intrinsic value of investing in non-consumable assets such as prestige real estate and fine art,” says Bonnie Stone Sellers, CEO of Christie’s International Real Estate, the world’s leading luxury real estate network and a subsidiary of Christie’s auction house.
London and New York continue to top the list of the key luxury real estate markets while Hong Kong has the world’s second-largest average price per square foot. Côte d’Azur recorded the highest percentage of international buyers and the highest percentage of second-home buyers. Paris ranked above average on many of the luxury real estate categories, such as number of sales over $1 million.
To contact the editor, e-mail:
Most Popular Slideshows
Join the Conversation
- 5 Cities With The Highest Cost Of Living In 2014
- Lamudi’s Top 5 Tourist Close-To-Nature Destinations In The Philippines
- 3 Key Changes The Real Estate Industry Is Expecting With ASEAN Integration In 2015
- $2B Lease By American Investor On Philippine Island For 25 Years
- Australia Second Highest Overpriced in World in Housing Prices
- Chilling: New ISIS Video Addresses Australia; Aussie Teen Delivers Message
- The Pirate Bay Blockade: Cost Of Blocking Websites Like TPB Is Ridiculously High
- Xiaomi Mi4 And MiPad Prices Likely Slashed, Thanks To Rivals Oppo, OnePlus And Meizu
- Virginia Woman Who Posted Naked Image Of Ex-BF’s New Partner 1st Person Charged Under Revenge Porn Law
- Meizu MX4 Pro To Arrive In November In Black And White Colours, Features Higher Than QHD Display, Exynos 5430 SoC And 3 GB RAM
- Israel Loses A Friend in UN Security Council As New Zealand Replaces Australia
- Severe iPhone 6 Supply Shortage Will Last Until Q1 2015 as Apple Grapples to Meet Heavy Demand