World equities are now in a bear market. The most excessive speculation has already been washed out of the system. Those warning of bubbles in bitcoin and other cryptocurrencies, meme stocks, or the growth tech companies have been proved right.
If there is one asset that should come under scrutiny, it is real estate, whose life blood is credit. For a double whammy of higher rates and the lasting effects of the pandemic, look to office property. Remarkably, Bloomberg’s index of US office property real estate investment trusts, or REITs, is slightly lower now than it was 20 years ago, and almost back to the lows it hit during the worst of the pandemic in 2020.
That brings us to housing. Rates in the mortgage-backed bond market are surging, as would be expected given the move in Treasuries, while the rates actually offered to US borrowers are even higher. Typical 30-year mortgage rates are now a whisker below 6%, and approaching the pre-crisis high of 2006
A world economy already contending with raging inflation, stock-market turmoil and a grueling war is facing yet another threat: the unraveling of a massive housing boom.
As central banks around the globe rapidly increase interest rates, soaring borrowing costs mean people who were already stretching to buy property are finally reaching their limits. The effects are being seen in countries such as Canada, the US and New Zealand, where once-hot residential real estate markets have suddenly turned cold.
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Caveat Emptor! Note: this is NOT financial or property advice!!
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When the students dont come thats 500000 rentals not needed.
Immigration was neagtive in 2021
for australia
NAH mate, we are not spam… You got promoted on Youtube front page,,, enjoy,,, you are telling the right story,,,, enjoy your temporary influx of newbys.
Do you think I could sell someone else's house if I promised to buy it back for them later?
I remember 7 years ago rock bottom rates were 5%, people should shop around and get ready for 5-6% rates soon
Love your channel, but after listening to so many north American channels, I have to put you on 1.5x playback speed.
dude is perma bear. makes valid points but bearish lens for them all. plus Australia is bigger than Sydney. far more markets out there
Gr8 Show, Martin…..Glad U r getting rid of the Crypto Spammers too….Cheers from Damo.😊
There’s a very good chance nz will see it’s largest crash ever just by losing the gains made over the pandemic period . Just going back to early 2020 would be worse than crashes in the 70s and 80s . And that’s very likely . Wellington is probably half way there now in only 7 months. Eve’s realestate yesterday in Tauranga had a auction. 0 out of 12 sold and only 1 bid . And thats the same over the hole country more or less. Listings are skyrocketing. By the end of the year even if inflation started improving the damage won’t be able to be reversed because equity to leverage against will be totally gone
Don't worry about us over here in NZ. The market is just in an itsy-bitsy little gully right now, that's all…,..
No I think that is a good idea. I didn't know you could limit comments to those who are subbed.
You’re a star. Thanks Martin
Another great video Martin.
The amount of people who have contacted me to move back to Japan with their spouse in the last month is off the charts. There is definitely panic especially in the US. They all say they see a 1990’s Japan style crash coming their way. These are people who experienced it first hand. It’s not looking good.
Fear Of Missing Out (FOMO) has turned into Fear Of Not Getting Out (FONGO)!!!
Cardboard House Building Quality Products………..slightly overpriced acknowledged to be the financial safety net for your pension.
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Check NZ's net migration for 2022, about 70,000 more people have left than arrived…
Well done Martin on hitting 60k subscribers. Should be far more for the fantastic work you do. Regards Steve, UK.
thnx martin…….IM SUBSCRIBED! SO LONG TO THAT SUKKER YAYYYYYY!
Great video! So much knowledge and education.. thank you so much
Keep an eye on NZ closely
Here in the Netherlands we are also in the top 10 housing bubbles. Still lot of people in disbelief that there will be an implosion in prices once the new rates will work its way through the system. People are already not able to pay their energy bills. I here people saying there is a housing shortage so prices will not drop 😂😂
Hi Martin, I enjoy the channel and find it really useful so thank you.
I wonder however whether you should be making it clear in videos such as these that you're reading the Bloomberg article almost verbatim so should cite and credit/link to the article and author in the video itself or the description?
Do not do so feels a bit misleading to me and potentially infringement of copyright. With it being a paywalled article there's an additional element of providing subscription based content for free which is a risk.
87th
Safest country for ww3
God defend New Zealand
Jesus is the only way
I was watching Bloomberg yesterday and about 90% of the comments were crypto spam.
Congrats on getting to 60,000 subs Martin, I have been with you since under 2000, where your main concern at the time was the colour of your shirt!
This is what happens when freedom is locked down
Net zero prosperity
Love your work as always Martin . Good idea getting rid of the spammers , so annoying.
As I have always said, NZ is a Petrie dish to study how a bubble ends and how this growth regime dies. Just wait for economists to dust off financial ‘catastrophe theory’ and start playing with mathematics they never understood in the first place. One-hunga, is On-e-hunga 🙂 but your not the first Englishman to butcher this place.
See you in September Mr. North.