Mid-Year Housing Bubble Predictions
What's your housing bubble prediction for the second half of 2022? Six months ago: " 2022 will be the year the Fed’s Everything Bubble bursts."
"A reader sent me some quotes he’s collected over the year: “Coming back down to earth” “Reverting to a normal market” “Reached a plateau” “Going from 100 mph to 80 mph” “Sanity is returning” “Instead of 30 offers, maybe 5 or 6” "It is still a seller’s market over a buyer’s market,’ Winder said, adding that it’s still hot – just not ‘habanero hot. We’re back down to chili sauce hot.” “But buyers are starting to say ‘Whoa, wait a minute, what are we doing here?”
From one year ago: "Over a decade’s worth of rate suppression from the Fed, without their ever having ended the policy after the 2007-2009 financial crisis, has left market fundamentals dessicated by the hunt for positive yields."
"What’s left at this point is a Hobson’s choice between safe investments with a negative expected return, after factoring in current and expected future inflation, and risk assets that everyone agrees are in a bubble which may generate stellar returns for a bit longer until a point of future collapse, which nobody could foresee, takes them back down to earth."
A reply: "Sometimes there is no safe investment or no hedge against loss by inflation. The political circumstances can be so high risk that anything could happen."