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The longevity of this housing market only depends mostly on the Fed and the foreign buyers IMO. While the Fed may run out of bullets sooner, we could be just at the beginning of the influx of foreign, mainly chinese, money which may at least keep the "prime locations" such as San Francisco from falling significantly. Overall though a red stock market will also depress the housing market, which is lagging a bit in decline as long as interest rates don't rise dramatically. No reason to party though ;)
Strategist
2014 Feb 1, 12:40pm
The drop in stock prices so far has been minuscule.
Large sustained drops could be a problem.
Let's hope it does not happen.
AD
2014 Feb 1, 1:02pm
A lot of the housing boom is being driven by investors especially those with cash. I think the boom continues as long as housing is not overvalued to the point that the average price to income ratios stay within the 3 to 4.5 range, and monthly rent is less than 40% of median household income.
I have heard several people on this forum and on housing blogs claim that big gains in the stock market have somewhat fueled increases in housing (especially in the higher priced markets). Although I do not know this to be true, but if it were, does anyone feel that recent plunge and perhaps greater future drops in the stock markets would bring down housing prices? Thanks for your opinions/thoughts.
#housing