In assessing the big city real estate markets, at CNBC Claudio Saputelli observes:
In a world in which more than a third of all government bonds offer negative yields, investing in tangible assets remains popular. So it is hardly any wonder that major urban housing markets are again overheating, just a few years after the last major wave of global correction. We see a significant overvaluation of housing in some key financial centers, with six markets in bubble risk territory.
Although cities at risk of a bubble may not experience a crash, investors should still bear in mind the significant chance of a correction over the medium term.
You will be relieved to hear that Mr. Saputelli does not list any U. S. city among the six most at risk of a bubble. Those would be Vancouver, London, Stockholm, Sydney, Munich, and Hong Kong.
What about Chicago? He attributes Chicago’s tepid real estate appreciation to the fiscal incompetence of Chicago and Illinois politicians and its “comparatively weak local economy”, which is basically another way of saying the same thing.
If one must be long real estate, attempt to be in a demographically and growth advantageous locale, recognize that shelter is a consumable, not an asset, or hold the asset as an income producing entity.
Point A disqualifies Illinois.
There’s about to be a massive correction to real estate prices along the Florida coast.
And if he hasn’t already, Andy needs to get the fuck out of
DodgeMelbourne. They’re talking about 130 mph sustained winds there by sunrise Friday morning.