Agree, ER, it’s not as bad as having everyone and their gardener qualify for multiple $500K+ houses without any income or asset documentation. Still, there are too many “investors” in the market, IMHO. Many of them are not the “mom and pop” landlord types who plan to hold onto these homes in retirement.
I just think that high interest rates will not only make traditional, owner-occupier buyers want to pay less, it will also likely draw all of these institutional players out of the housing market. It’s entirely possible that they will want to sell around the same time. Everything I’ve seen and heard shows a 5-7 year disposition plan. What if all of the people behind these investment groups decide to cash in at the same time that interest rates go up?
It just seems like there is an awful lot of leverage still out there, and too much money going after too few investments that offer too-low returns for the risks that lurk when/if something goes wrong.
Of course, I could certainly be wrong about all of it, and we could see long-term massive inflation, instead. It would be nice if the Fed would step back for a bit so that we could all see what the markets would look like without all of the central bank interventions. It’s incredibly distorted right now, IMHO.
