The Hurricane Called Housing Crisis Misses the US For Now

So, just like the hurricane missed Tampa (but hit Fort Meyers hard), it looks like the hurricane "housing crisis" may have only a limited affect in the US.

Do you remember the weather report a few years ago where the weatherman was acting like the wind was blowing him all around, and then 2 guys walk behind him seemingly unaware of the weather? (Link to the video below)

I think that describes the reporting of the housing market in the US.

For example, you may have seen reports from Case-Schiller reporting that for the 1st time their 20-city survey showed a decline in month-to-month prices.

This exaggerates the market change in one month, as it really chronicles the slowing down of the INCREASE rather than a decrease in prices. In fact, the same report shows the actual increase year over year of the annualized rate for that month to be 12%, which is a great return for any investment. 

In fact, a headline from data source Radian, while highlighting the slowing, buries the lead that the annual return of housing prices in the month of August 2022 was a 12% increase.

Now, there are danger signs, such as last week's bond market drama in London, the gas pipeline issue with Russia, the war in Ukraine, and potential war in Taiwan, but as for now, despite all the drama and whipsaw of rates, housing prices, along with all prices in our economy, continue to increase, NOT crash.

The main driver of increased prices for housing continues to be tight supply, and it shows no signs of changing. Take California for example. Our housing supply has ran behind our population for the last 40 years, and what is the answer? Well, our state government passed laws to increase the building of low-income multi-family buildings in suburbs, and the suburbs affected don't want to build that type of housing. The solution our state has it after passing laws that the cities don't want is to sue them. All this sounds high-minded, and maybe could be a good policy, but the actual result is more litigation and money to attorneys rather than housing being built at this time.
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Bill Gross, The LAProbate Expert
I am a real estate broker in Los Angeles, CA focused on probate real estate and the leader of a team of over 1,100 agents nationally probate experts.

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