buying a home

Blog

The Unsafe Foundation of Our Housing 'Recovery'

Overdependence on subsidies, debt, and unfounded optimism
Monday, February 25, 2013, 5:55 PM

What could go wrong with the housing 'recovery' in 2013?

To answer this question, we need to understand that housing is the key component in household wealth. And, that Central Planning policies are aimed at creating a resurgent “wealth effect,” as follows: When people perceive their wealth as rising, they tend to borrow and spend more freely. This is a major goal of U.S. Central Planning.

Another key goal of Central Planning is to strengthen the balance sheets of banks and households. And the broadest way to accomplish this is to boost the value of housing. This then adds collateral to banks holding mortgages and increases the equity of homeowners.

Some analysts have noted that housing construction and renovation has declined to a modest percentage of the gross domestic product (GDP). This perspective understates the importance of the family house as the largest asset for most households and housing’s critical role as collateral in the banking system. » Read more

Blog

Real Estate: Is the Bottom In, or Is This a Head-Fake?

The housing recovery is no sure bet
Thursday, December 6, 2012, 11:32 AM

Everyone interested in real estate is asking the same question: is the bottom in, or is this just another “green shoots” recovery that will soon wilt?

Let’s start by reviewing the fundamental forces currently affecting real estate valuations. » Read more

Podcast

Patrick Killelea: What Every Homebuyer (and Homeowner) Should Know Now

Beware today's investor-led 'recovery'
Friday, November 2, 2012, 10:14 PM

For many, the collapse of the housing bubble was the trigger that began the era of economic slowdown Americans find themselves mired in.

But recently there have been growing reports in the media of a housing "recovery." So we've invited Patrick Killelea, founder of the popular housing site Patrick.net and author of The Housing Trap: How Buyers Are Captured and Abused and How to Defend Yourself, to clarify the situation.

The short answer is this: While there are some markets where home prices are back in line with both fundamental and historic norms, buyers still need to exert caution when making a purchase. » Read more