The housing price conundrum
Why did housing prices go up so much from 2000-2006 even though classical supply/demand would not have called for it
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25 Responses to “The housing price conundrum”
Housing Bubble (Song is now on iTunes!)
by admin on August 19, 2010 - 25 Comments
A musical commentary on the current real estate situation in the US of A. Get a copy of The Housing Bubble Song on Amazon!: www....
The housing price conundrum
by admin on August 20, 2010 - 25 Comments
Why did housing prices go up so much from 2000-2006 even though classical supply/demand would not have called for it...
Pushy Real Estate Agent
by admin on August 20, 2010 - 25 Comments
from the Peter Serafinowicz Show Christmas Special...
Krugman on the US housing bubble
by admin on August 20, 2010 - 25 Comments
Paul Krugman from Princeton University predicts the biggest housing bust in history....
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The Natural Economic Order
By Silvio Gesell
Translated by Philip Pye M.A.
CHECK THAT OUT, SERIOUSLY!
Hi Sal….hats of to you !!!!!!!!!!!!!!!!!!!!!!!!!!!!!
You are awesome !!! Your explanation is “SIMPLE” and to the earth. You are giving this hard-earned knowledge to public for free!!!!!!!
YOU will find yourself in heaven when it’s time for GOD to decide where HE relocates you!!!…
ALL the BEST!
I learned a whole set of new Mathematics and Logic…thanks to your VIDEOS!!!
I am already subscribed and eagerly waiting for anything new from your end!!!!
GOD BLESS YOU !!!
When the housing bubble was growing I owned homes but I was not educated on how to react, what strategy to use when, you own an asset and it is involved in a bubble, you should sell into a bubble, and buy when it burst,I didnt understand cds,or cmo I gained a painful and costly education, great vids thanks for posting………
Sal!!!! I am studying your Dif Eq videos, so I had to laugh a little when you pulled up the calculator to figure 1.8 * 4. Haha, you’re doing a great job my friend. Keep up the good work.
7:20
well some Hurricanes such as Katrina destroyed a lot… but compared to 1.8mil a year, still negligible i imagine.
Just heard you on KCRW… Great interview! you have gained a fan!
.
Good day mouth pieces of Leviathan, the day is coming when all of you will eat your money and credit cards; you will go outside to eat grasses and you will drink waters in canals. You will become paranoid, trembling day and night, you will die insane, hopeless because you cannot hear this simple word: REPENT!
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if you want poeple to buy houses give us the frigen means to! LOWER HOUSING AND RENT COSTS!
i call on poeple to revolt against housing price increases and land tax! if people dont, then wallstreeet and gov will do what it can to make society go mass homeless. we need to revolt against housing price hikes, and demand price freezes on housing! Wallstreet has to be banned from manipulating peoples right to shelter and wellbeing! price hiking on housing must stop now!
its ben bernaki. he when in office on jan 2006 and then it fell.
People already there who rent; trust funds; corporations; the shadowy central bank sheisters that create our currency out of thin air and then have the gall to charge interest on it – lots of people can buy houses not just newcomers. Get you thinking don’t they these vids; very good khanacademy!
The powers that be dropped the lending criteria the mortgage interest rates and the lemmings streamed in. I know I was one of them; naive aspirational morons. They deliberately don’t teach you finance at school! Then the overlords repackaged high risk mortgages to look low risk (by CDOs and DCSs as khanacademy explains in other vids) and cashed in on that side as well; the clever greedy destroyers.
Debt consolidation can be a really useful tool for many people, the key is of course to do a little homework and make sure you’re not dealing with a rip off merchant.
consolidationnetwork . com
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Well said, good tips in your videos. But to me it doesnt make sense how demand is higher w/forclosures and job losses on the rise? Because then wouldn there be less demand and more supply? And homes get more expensive every year why? So we can continue to lose them and not be able to afford them? This is why i think a lot of people nowadays just live w/parents till their like 25 and save their money cuz without any job security, whos gonna want to take out a 30 year loan??
Good presentation. You are the first person that I have heard that has Mentioned the law of “Supply and Demand”. The US population increases 1.2 million per year which means that per year less than 1 million homes can be sold. Yet they built 1.8 million homes per year.
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Nice work. keep it up. mean time come for social media marketing for esteembpo**com ghjgh
I didn’t see your next video yet, but it seems to me that the other demand factor that you should have listed was credit availability. For the time period that you mentioned, credit standards became extremely lax, and mortgage backed securities flooded the market with cheap capital to fuel demand.
fascinating. thanks for sharing your thoughts.
…More – Here’s a novel though. Maybe the world doesn’t need the Billionares’ money. If we needed it, it would be used effectively and markets wouldn’t get distorted. It sounds like the billionares need a place to invest their money more than the world needs to use their money. Hmmm, too much money in the system, I think I’ve heard that before.
I think Sal nailed it. You make a good point about community increasing value. I bought an empty lot in Andahuaylas, Peru and the value tripled because they built a university next door. No buildings just an empty lot.
However, that happens always and everywhere but it sounds like this happened because these HUGE hedge funds needed places to stick their money. These securities got hot and it spiraled out of control. Hedge funds are dangerous in this way.
jgposner: what I did not have space to say before is that the increase of the price of housing was an increase in the price of land since houses themselves do not appreciate beyond the relatively modest increase of the cost of building. The so-called housing price run up was land speculation which everyone in the know knows busts about every 18 years. The point is that land value is created 100% by the community and taxing it would be economically just, end speculation and drive down prices.
Well said. All the things you said go into bottom line of the price of a house, including artificially low interest rates. Even without speculators, the prices would rise because houses are normally sold on the basis of what kind of monthly payment one can afford. Once rates go up to fight inflation, America will be hit again. Of course, like you mentioned, speculators made the problem worse.
In addition, the media and realitors and the make money in realestate get rich quick programs all said housing prices will continue to rise. So people saw it as a money making opportunity.
Yes there was more money out there. It was created by the FED. And they made it irresponsibly easy for us to get it. We were willing to go into debt because we thought we had equity in our homes and the media and realitors and the make money in realestate get rich quick programs all said housing prices will continue to rise. Boy, you serries on banking was so good and the central bank model seemed so effecient. But now I’m seeing them more as a threat.
What do you mean “if you buy the supply and demand argument”. Isn’t supply and demand common sense? Another thing that would drive demand is peoples willingness to dip into savings. Or in this case dip into equity which was a mirage thanks to the Fed generated housing bubble. Sorry, corrupt politics makes the central bank design unworkable.