The hottest Home Prices Substack posts right now

The clampdown on mortgage lending in 2008 led to unprecedented rent inflation, reinforcing the relationship between home prices, rent ratios, and access to credit.
The natural experiment since 2008 confirmed that cutting off mortgage access lowered price/rent ratios substantially, leading to collapse in construction and significant rent increases. This situation may have reached a point where new homes could be constructed again on a larger scale.
A regressive rise in home prices occurred post-2008 due to a credit shock affecting existing home values and necessitating a rise in land rents to induce new construction. This situation highlights the impact of housing shortages on rent inflation and home values.

The divergence between the average price of new homes and existing homes signals obstructed supply in the housing market.
Changes in mortgage rates and market conditions can influence the size and types of new homes being built and sold.
Reforms allowing for more new homes to be built could lower costs and reduce the price of existing homes.

Mortgage affordability is affected by prevailing mortgage rates, which can impact transaction volume and buyer costs.
The measure of mortgage affordability must be used with caution as inflation and buyer behavior play significant roles in housing market dynamics.
The rental value of structures versus inflated land value over time can affect the dynamics of home prices and construction, highlighting the complexity of the housing market.

The rise in home prices is mainly due to obstruction of urban housing rather than urban productivity.
High urban rents have increased nationally post-2008 due to federal lending policies lowering housing production everywhere.
Rising rents explain almost all of the increase in home prices, with excess rent accounting for a significant portion of residential real estate value.

The housing market has a significant impact on the U.S. economy, representing 15-18% of GDP.
High interest rates and low inventory in 2023 caused fewer transactions and high home prices.
Predictions for 2024 include falling interest rates leading to more supply, potential modest price declines, and buyers becoming more rational.

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Bank of America analysis suggests a deficit of 4 million homes in the US due to underbuilding over the past decade.
Home prices spiked by 41% during the Covid boom with 60% attributed to the work-from-home trend.
Vacancies are a crucial part of housing supply, with a potential need for a 300% increase in supply to match demand from 2020-2022.

Mortgage rates are at historic highs, hovering between 7-8% and leading to all-time high home prices despite low affordability.
Inventory shortage persists as people with locked-in low mortgage rates hesitate to sell, contributing to the rise in home prices.
Even with rising interest rates and low affordability, US home prices show resilience with 12 consecutive years of gains, indicating a continuing strength in demand.