Does the boom have room left to run? Bulls and bears both make strong cases. Buyers note that fiscal stimulus and lower consumer spending have left household balance-sheets unusually healthy; that remote work has encouraged people to prioritise their living environments; and that interest rates are near all-time lows. Sellers counter that those rates have been rising quickly; that mounting debt will force governments to tighten their belts; and that rents in big cities have fallen sharply.
Giving equal weight to each of the 16 countries for which the model has data, its central estimate is that the rally is likely to stall but not reverse. It expects appreciation to slow to 3.4% this year, and to 0.7% by 2023. Much of this deceleration comes from America and Britain. However, because prices are currently soaring in those markets, the model projects them to climb a bit further before reaching a plateau.
Elsewhere, the model does expect price declines. It is most dubious on Spain, which faces a mix of deflation, high unemployment and stagnant incomes. The most likely scenario is that prices there eke out paltry gains in 2021 and then turn south. Sweden and Canada also have unemployment rates above 8%, and the model predicts they will start facing losses in 2023.
Among big markets, the model is most bullish for the next two years on France and Germany, where solid fundamentals back up recent price increases. Yet by mid-2023, it expects annual appreciation of just 1.2% and 1.6% in those countries. The longest-lived bright spot is Ireland, predicted to lead the table in 2023 with a gain of 2.5%. The model does not explicitly count Brexit-driven relocations to the’s lone English-speaking country. Instead, it is impressed by Ireland’s healthy numbers on jobs and incomes. Moreover, household credit in Ireland is far below the rich-world average, implying that buyers have room to increase borrowing.
Housing prices are up? Mass shootings are up? I guess American is getting back to normal🤦🏾♂️
Inflation....
What’s the story of Corporations buying up the houses just to jack up the prices? Can you do an investigative story on that, please? housingmarket
There is a housing boom? When no one can work? How does that make sense?
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