Great time to buy a house … again

From Bloomberg:

Housing Market’s Comeback Is Poised to Accelerate

Housing was the epicenter of the last recession. From the peak in 2005 to the end of the contraction in mid-2009, U.S. residential investment declined at an unprecedented rate of about 20 percent a year. In normal business cycles, sectors that overshoot to the downside tend to rebound sharply. Given the significant oversupply of homes and tightening of credit, housing enjoyed no such recovery. Residential investment was essentially flat for almost two years after the recession ended. Since then, a slow recovery has been underway and we suspect the housing market will pick up in the year ahead.

Although residential investment has been expanding since 2011, recent growth has been sluggish, rising just 1.1 percent over the last year, compared with about 7 percent in the two previous years. Some of this weakness can be attributed to a housing market in transition: Owner-occupied real estate is recovering as renter-occupied real estate is declining. Also, multi-family construction is ebbing as single-family building picks up. With inventories tight, home resales appear to have flattened out as new home sales take a greater share. In other words, conditions in the U.S. housing market are normalizing. That’s a good thing.

There are good reasons to expect residential investment to pick up after sluggish growth this year.

Consumer attitudes are strong, supporting housing demand. It helps that general economic conditions have improved. According to the latest University of Michigan Survey, more people say now is a good time to buy a home because of “prosperous times.” This is a notable difference from the bubble period of 2005-06 and suggests a recovery built on firmer ground.

More respondents say now is a good time to buy a home because “prices won’t come down” and because it’s a “good investment.” Price expectations matter. The improvement in household buying attitudes, helps keep user costs low. In a standard user cost of housing model, the expected value of the home offsets maintenance costs such as mortgage interest and property taxes and depreciation. No one wants to finance an asset class they believe will go down in value. Thus, it is welcome that consumers see housing as a solid investment once again.

This entry was posted in Demographics, Economics, Housing Recovery, National Real Estate. Bookmark the permalink.

82 Responses to Great time to buy a house … again

  1. Mike says:

    Good Morning New Jersey

  2. Hold my beer says:

    First

  3. Hold my beer says:

    Foiled

  4. Hold my beer says:

    If you want your kids to be independent, ignore them as much as possible

  5. grim says:

    I’m not 100% convinced that leaving your kids with nothing is the best strategy anymore. I understand the point, and I understand the negative repercussions of leaving them with wealth. But, the parent/children that can pull off effective transfer of wealth without the negatives will have a better life, period. Maybe 50 years ago, this wasn’t a consideration, but looking at wealth inequality, cost of education, cost of living, I can easily see situations where the kids with wealth transfer will be significantly better off.

  6. Hold my beer says:

    Maybe losing salt and mtg deduction won’t have much of an impact in the more desireable areas and locations.

  7. 30 year realtor says:

    In my view the tax changes will have strong, negative impact on real estate values in North Jersey. Homes with price tags in excess of $700,000 with taxes over $20,000 will feel the impact.

    As a regular bidder at sheriff sales in North Jersey I see a lot of 4000+ GLA homes in distant commuting locations with property taxes in excess of $20,000. These homes are already hard to sell with many still depreciating. The tax law change will have a large impact on these white elephants!

  8. yome says:

    True Cost of owning a House is ; Mortgage Interest plus Property Tax and Improvements. If you can buy a House that your monthly is lower than Renting. Buying a House makes sense.
    Example is My $288,000 house with a quarterly Property Tax payment of $1,800, $1,775 Mortgage 15 years at 3%. $1,300 goes to Principal Monthly and $500 to Interest. $1,800/3 + $500 Interest is equal $1,100 a month. Three Bedroom Rent around me is $2,500. I am making $1,400 a month on Rent not paid. I could sell the house at amount I paid OR sell at what I owe at time I sell and will still be ahead. I can give away the house when mortgage is paid and still be ahead. Rent goes up every year Mortgage amount stays the same

  9. Yo! says:

    Who buys a house with $20,000 taxes (going to $30,000 soon)?

  10. yome says:

    Take 25% off $1,100 from Deductions before law equal to $825 Buying against $2,500 a month Renting. $1,675 monthly gain (Plus Yearly Increase in Rent) against Renting less Improvements

  11. yome says:

    Cost of Property Tax is passed to Tennants. NO?

  12. yome says:

    My Parents is leaving 6 siblings a Building with Ancestral Home on second Floor, 1 hectare of Commercial Property and 2 Land in a Development.

    The 1 hectare is from a 7 hectares Sugar Plantation turned to Commercial Property as Years pass divided to 7 Kids from my Grandparents.

    All my sibling are doing well in Life that all their share will be pass to their Kids. My share will have to be named to my Kids before my Parents die,to avoid US Tax. I probably have 10 to 20 years to live. I can not bring this on the grave.

    My Ancestors reason for leaving next Generation properties is; if they ever need a place to stay it will be there.

  13. yome says:

    Sugar Plantation is from my Great Grand Parents 50 hectares divided to 6 Kids

  14. Bystander says:

    I know at least three people close to me who are living a lifestyle now with understanding that parents will pass on million or more in next ten years when they pass. NY metro is mostly wealth transfer babies

  15. 3b says:

    Maybe the authors of this article need to revisit this once the new tax law passes.

  16. yome says:

    Uprising in Jerusalem right now! What did the US get in declaring Jerusalem Capital of Israel?
    No News is always Good News- Not anymore

  17. 3b says:

    We paid for all of our children’s college free and clear no loans. I don’t want the time if there will be people leaving millions to their children some of course have it and will most I don’t see it. Mortgages still in their 50s home equity loans to pay for college lavish weddings that some pay for. When our kids get married each one will get a check told them use it wisely. My wife and I will spend our money not blow it and whatever is left is theirs. They did not have to pay for college. That is a huge gift right there.

  18. JCer says:

    The key is to leave your children significant assets but never really let them know what you have. Also placing assets in trust allows some level of control, the assets are there’s to use but really are intended to be perpetual familial wealth that a generation of f’ups cannot destroy…………..

  19. yome says:

    We paid for my kids College Education too, no loans. I told them, Tell me where the wedding is and I will be there. Do not expect me to pay for your wedding. I point them to my wedding picture taken by a friend. I blew up and put on a frame years later. I can not even afford a decent picture when we got married. My wife cook for the guest when we got home. We are still together 32 years later.

    My son got married last July paid for his wedding and we had a good time. One more to go.

  20. JCer says:

    Also lets face it in the right circumstance the inheritance won’t come until you are 60 or 70, so your kids will need to make it on their own…….

  21. Chuchundra says:

    The tax bill isn’t a done deal yet.

    The Senate version is riddled with mistakes, including an error in the corporate AMT rate that would cost businesses nearly 300 billion dollars.

    There’s going to be a conference bill and re-vote on both sides.

  22. chicagofinance says:

    Personally, I give Trump some credit for showing sac on this one….. the hypocrisy and anti-semitism is thick as honey on a cold morning…… fcuk all of them….

    yome says:
    December 7, 2017 at 9:02 am
    Uprising in Jerusalem right now! What did the US get in declaring Jerusalem Capital of Israel?
    No News is always Good News- Not anymore

  23. Mike says:

    As a child of ‘wealthy’ parents. They paid for my college, never charged me rent, and showed me the ‘right’ path to get a good job after school.

    I still max my 401k, stick to a frugal budget with trying to save near 20% after tax, etc.

    I may inherit millions, but I act as if I will get 0 dollars. Some bad health issues can wipe out a lot of wealth…

  24. chicagofinance says:

    Helping your kids?

    As a financial planner and a parent, you have to know your kid…… you want independence, but there is also confidence in knowing that someone has your back….. there is that point in the working world that you realize that there is no mission, no higher calling….. everyone in their own style is a mercenary…. for whatever reasons…. money, ego, their own family, power…. once you realize you are on your own, the idea that a parent is out there watching over you and rooting for you is a big deal….. some people have that parent and some don’t….. as has been noted, it is easier when that parent exists and can make things just a bit easier….

    For those that are lucky to have that parent and take it for granted…… FCUK YOU

  25. 3b says:

    Chgo I agree. My kids truly appreciate it. They really appreciated it when they got out in the working world and have conversations with co workers and friends they grew up with complain about their student loans. A few times they had mentioned that we paid for it no loans. They were shocked omg you guys are so lucky!! Some of these were the same kids who had sweet 16 parties in catering halls and all the rest. I told my kids next time a conversation on student loans come up just nod in acknowledgment and say nothing.

  26. Blue Ribbon Teacher says:

    lol, bitcoin at $15k.

  27. 3b says:

    Some of these people will still have mortgages and student loans in their 60s /70s. The inheritance will pay at least some of those off. Maybe that’s what they are hoping for.

  28. Grab them by the puzzy says:

    hopefully your kids will be independent enough to ignore you when you die

    Hold my beer says:
    December 7, 2017 at 8:10 am

    If you want your kids to be independent, ignore them as much as possible

  29. Blue Ribbon Teacher says:

    scratch that, $16. Pumps was right! Buy and hold for a few hours at most.

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  31. ExJerzy says:

    10:09. Savage AF

  32. Steamturd, Part Time Orientalist and Full Time Mysoginist says:

    I am planning on paying for my kids’ secondary educations. But don’t think for a minute that they are not helping me maintain the multi-family. Once, during a snowstorm, I called Gator Jr. to come home from a friends house to help me shovel. He refused. My punishment was that he then had to arrange rides to his next three hockey games since I wasn’t driving him nor even going. Additionally, any gift they have ever received (since birth) over $20 goes into the 529. That, combined with my Upromise money is already up to 40K. This should pay for their books. :P When I went to school, my parents had done the same for me. I blew the money saved by being a complete derelict my freshman year. I paid for college myself the rest of the way and my parents gave me the remainder of my college money after I graduated (which admittedly wouldn’t have paid for more than one semester). I understand that working and paying one’s way through college is nearly impossible today. But if my kids make the same mistake I did, they can take out loans like all of the rest. Gator Junior is fiercely independent. I’m very proud of this.

  33. Hold my beer says:

    Grab,

    Impossible. I am immortal.

    I am surprised you can post something besides tweets from brainwashed hypocrites

  34. ExJerzy says:

    Brainwashed…? Ever talk to a die-hard republican? Lol

  35. Blue Ribbon Teacher says:

    lol, now approaching 18k…is a few hours up yet?

  36. Blue Ribbon Teacher says:

    $0000 – $1000: 1789 days
    $1000- $2000: 1271 days
    $2000- $3000: 23 days
    $3000- $4000: 62 days
    $4000- $5000: 61 days
    $5000- $6000: 8 days
    $6000- $7000: 13 days
    $7000- $8000: 14 days
    $8000- $9000: 9 days
    $9000-$10000: 2 days
    $10000-$11000: 1 day
    $11000-$12000: 6 days
    $12000-$13000: 17 hours
    $13000-$14000: 4 hours
    $14000-$15000: 10 hours
    $15000-$16000: 5 hours
    $16000-$17000: 2 hours
    $17000-$18000: 10 minutes
    $18000-$19000: 3 minutes

    we’ll be at 50k in a few hours

  37. Steamturd, Part Time Orientalist and Full Time Mysoginist says:

    I hear real estate in Cali is on fire. Literally!

  38. Hold my beer says:

    Franken to resign in a few weeks. The senate loses a comedian. Retains 99 clowns.

  39. Grab them by the puzzy says:

    @ezraklein

    It’s true: if Al Franken should resign, so should Donald Trump.

    But the fact that Trump won’t resign doesn’t mean Franken shouldn’t.

    Democrats holding themselves to higher standards is a step towards everyone being held to higher standards.

    It doesn’t happen all at once.

  40. Hold my beer says:

    Grab still copying and pasting drivel

  41. D-FENS says:

    Oh Man this is huge…the implications for the NJEA and the State of NJ cannot be understated…

    https://www.reuters.com/article/us-usa-court-unions/trump-administration-sides-against-unions-in-high-court-fees-case-idUSKBN1E108I

    WASHINGTON (Reuters) – The Trump administration on Wednesday said it would oppose public sector unions in a major case currently before the U.S. Supreme Court, reversing the view taken by the Obama administration in an identical dispute.

    The Justice Department filed a friend-of-the-court brief against the unions in a case brought by a non-union government employee in Illinois that targets fees his state and many others compel such workers to pay to unions in lieu of dues to fund collective bargaining and other organized labor activities. He is arguing that such fees violate the free speech rights of non-union members.

    The high court heard a similar challenge out of California in January 2016 and had appeared headed toward ruling the fees unconstitutional. But conservative justice Antonin Scalia died a month later and the short-handed court ended up with a 4-4 split in April 2016 that left the law intact but set no nationwide precedent. In that case, the Obama administration filed a brief backing the unions.

    Addressing the change of position, Solicitor General Noel Francisco said in the court filing that after the Supreme Court agreed to hear the new case “the government reconsidered the question and reached the opposite conclusion.”

    The Trump administration has already adopted opposing positions to those taken by the Obama administration in other major cases pending at the Supreme Court, including another labor case on whether employers should be able to require workers to sign contracts that prevent them from making class action claims.

    The administration also reversed an Obama administration stance by supporting Ohio in its bid to revive a state policy of purging people from voter-registration lists if they do not regularly cast ballots.

  42. Steamturd, Part Time Orientalist and Full Time Mysoginist says:

    Why don’t blacks take free cruises?

  43. Steamturd, Part Time Orientalist and Full Time Mysoginist says:

    They’re not falling for that again!

  44. D-FENS says:

    @mikehtrujillo
    Follow Follow @mikehtrujillo
    More
    SOURCES: @CNN and @washingtonpost working on exposing 20-30 congressional members 4 sexual harassment. #DC

  45. The Great Pumpkin says:

    It’s funny. Die hard republicans think workers are the problem, not the owners taking a big sh!t on society with their extortionist ways. When a worker comes together to get better compensation and working conditions, they are evil. When business extorts local/state govt weak position, it’s okay, you cheer it on. When they extort workers who also are in a weak position of negotiation, you cheer it on. So why do you get mad at workers for coming together to try and create a better position for themselves? Why is this taboo when business does it on the regular?

    D-FENS says:
    December 7, 2017 at 12:18 pm
    Oh Man this is huge…the implications for the NJEA and the State of NJ cannot be understated…

    https://www.reuters.com/article/us-usa-court-unions/trump-administration-sides-against-unions-in-high-court-fees-case-idUSKBN1E108I

  46. D-FENS says:

    The workers are the ones suing.

  47. Daddy Deported says:

    Al Franken fully forgot about rule #1 when it comes to avoiding sexual harrassment charges:

    Rule #1: Be Handsome.

    http://www.nbc.com/saturday-night-live/video/sexual-harassment/2751966?snl=1

  48. Daddy Deported says:

    Pumps fully forgot about all of the rules when it comes to avoiding ignoramus charges:

    Rule #1: Be Intelligent
    Rule #2: Don’t lie about having 3 degrees.
    Rule #3: Don’t buy an expensive highway house near a radioactive waste dump site and claim to be a real estate genius.
    Rule #4: Pick you parents properly.

  49. Daddy Deported says:

    This is some genius-level messaging: Trump’s statement about the FBI/FBM (Federal Bureau of Matters) being in “tatters” did not refer to the hard-working field agents, but rather the FBI’s “political leaders”.

    Haha!

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  52. Daddy Deported says:

    GOP lawmakers have come forward with new allegations of political bias or interference at the FBI – this time involving the 2012 Benghazi attack. John Solomon of The Hill reports tht Rep. Ron Desantis (R-FL) recently interviewed a retired FBI supervisor who told him he was instructed by Deputy Director Andrew McCabe not to call the 2012 Benghazi attack an act of terrorism when distributing the FBI’s findings to the larger intelligence community – despite knowing exactly who conducted the attack.

    http://www.zerohedge.com/news/2017-12-07/fbi-deputy-director-mccabe-told-agents-lie-about-benghazi-investigation-says-gop-law

  53. Blue Ribbon Teacher says:

    The fact that the NJEA gets to force me to pay dues even though they don’t collectively bargain for me is criminal.

  54. yome says:

    Franken resignation opens an opportunity for GOP to have a tighter hold on Senate
    +1?

  55. Blue Ribbon Teacher says:

    the idea that Dems are patting themselves on the back for asking for Franken’s resignation is laughable. It wassn’t like we discovered he was a scumbag yesterday. This was weeks ago. He initially scoffed at the idea of resigning. Dems waited a long amount of time before taking this position. Why? They figured they would see if they could get away with ignoring him. Bill Maher and his cohorts even went on a PR blitz about why he should resign. Pelosi initially tried to take the same approach with Conyers until it blew up in her face. She then pulls an immediate 180.

  56. Libturd sporting Tiger Wood says:

    I actually see Franken resigning as the high road here. Potentially, a turning point for the Dems.

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  58. Daddy Deported says:

    Lib – I don’t see it that way, I see it as two things:

    0. Conyers and Franken both get replaced by equivalent voters (probably minority women for further effect).
    1. Last ditch attempt to derail a Roy Moore victory – which would gain Dems a critical seat for the cost of absolutely nothing.
    2. Set the narrative for 2018 and beyond that the Dems are the only party that cares about women as more than puzzies teed up for grabbing (even thought the majority of puzzy grabbers are Dems).

    Without the upcoming Moore election they would have done nothing.

    BTW, ever notice how every major network except Fox *never* talks about the economy?

    I actually see Franken resigning as the high road here. Potentially, a turning point for the Dems.

  59. The Great Pumpkin says:

    Agreed. About time someone in govt starts acting like an adult and taking responsibility for their actions.

    Libturd sporting Tiger Wood says:
    December 7, 2017 at 5:24 pm
    I actually see Franken resigning as the high road here. Potentially, a turning point for the Dems.

  60. The Great Pumpkin says:

    Now if the President could only do the same instead of yelling fake news at any report that points out his irresponsible actions. Dude is so sick, or just believes his own bs. Maybe he just really cons himself into believing his own lies. His most recent bs, stating that the “grab them by the puzzy” audio was made up. This after admitting he said it a year ago. Definition of insane and this guy is running the country. Really can’t make this stuff up.

  61. D-FENS says:

    No it doesn’t. The Democratic Governor will just fill his seat with another Democrat.

  62. D-FENS says:

    The above was for yome

    yome says:
    December 7, 2017 at 4:15 pm
    Franken resignation opens an opportunity for GOP to have a tighter hold on Senate
    +1?

  63. Chi says:

    Franken resignation is 100% about Moore. Conyers & Franken will be replaced by like minded successors. Tactically Moore has to become center stage for the next phase.

  64. yome says:

    Opens a Minnesota Special Election in 2018. GOP just needs a good Candidate. +1

  65. joyce says:

    Mars Wrigley has said it plans to move 113 jobs from Chicago and 370 jobs from Hackettstown to Newark. The Hackettstown location will retain about 1,000 jobs, the company said.
    http://www.nj.com/essex/index.ssf/2017/12/candy_giant_to_open_new_hq_in_newark.html#incart_m-rpt-2

    $31 million tax incentive (over 10 years) to bring 113 jobs to NJ… the ROI is ___?

    only an idiot could read the above and below article and thing NJ is gaining 1500 jobs
    https://patch.com/new-jersey/wayne/s/gay3k/major-company-to-move-hq-to-nj-1-500-new-jobs-expected?utm_source=alert-breakingnews&utm_medium=email&utm_term=weather&utm_campaign=alert

  66. joyce says:

    and think*

  67. abeiz says:

    “It’s not a lie if you believe it!” – G. Cantstandya!

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  69. chicagofinance says:

    Another Pumpty First:
    An Unfortunate Memento of the Total Eclipse: Eye Damage
    Stunning evidence of harm that can come from staring at the sun during an eclipse: It’s burned into one patient’s retina

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  71. Daddy Deported says:

    Santa Claus (rally) is coming….to town!

  72. Daddy Deported says:

    Highway House near a radioactive dump site…..is fu.cked!

  73. Daddy Deported says:

    I shouldn’t be so hard on poor Pumps. He’ll never leave because he only knows loving the spanking.

  74. Daddy Deported says:

    Well my daddy left home when I was three
    And he didn’t leave much to Ma and me
    Just this old guitar and an empty bottle of booze
    Now, I don’t blame him ’cause he run and hid
    But the meanest thing that he ever did
    Was before he left, he went and named me “Pumps”
    Well, he must o’ thought that is quite a joke
    And it got a lot of laughs from a’ lots of folk
    It seems I had to fight my whole life through
    Some gal would giggle and I’d get red
    And some guy’d laugh and I’d bust his head
    I tell ya, life ain’t easy for a boy named “Pumps”
    Well, I grew up quick and I grew up mean
    My fist got hard and my wits got keen
    Roam from town to town to hide my shame
    But I made me a vow to the moon and stars
    I’d search the honky-tonks and bars
    And kill…that sonnabitch that named me “Pumps”

  75. Daddy Deported says:

    Get ready to make money…

  76. Daddy Deported says:

    I’m going to guess 241,000

  77. Daddy Deported says:

    Woo-hoo! 228,000!

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