The housing market has slowed for one simple reason: Prices are simply too high for most investors to find any value in the housing market
NEW YORK, NY (PRWEB) March 14, 2006
There’s no question about it: the U.S. housing bull market has turned into a bear. New home sales have dropped to 2004 levels and are continuing to decline. Price hikes have slowed. Buyer cancellation rates are up 30% in some areas.
What’s more, many potential homebuyers can’t afford the price of a new home; they’re opting to rent until the market bottoms out.
This may sound like grim news, indeed. But is the housing market bubble about to burst? No. “It’s a slowdown, not a collapse,” says Dr. Mark Skousen, Chairman of http://www.investmentu.com
“The housing market has slowed for one simple reason: Prices are simply too high for most investors to find any value in the housing market,” Skousen says. Investors who flocked to real estate just a few years ago have curbed their appetite for rental units because cash flow from rents doesn’t cover exorbitant mortgages.
But Skousen is among a small cadre of economists who think the real estate trend will be helpful to investors.
He says that within the next two years, the real estate market could reward patient investors with some great deals.
“This doesn’t mean buying a foreclosure,” he says. “It means taking the time to uncover real bargains, below their current market price.”
In fact, Skousen remains a long-term bull on real estate, for the following reasons:
- Superior tax advantages
- Unstable geo-politics
- America is for sale. Foreign investment continues to grow.
http://www.investmentu.com, an educational investment e-letter, brings dynamic market information to more than 300,000 subscribers each day. For more information about our editors, or to set up an interview, please contact Juan Muñoz at 410.223.2693 or visit http://www.investmentu.com.