Have Home Prices Reached Their Peak?

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Dec. 31 (Bloomberg) –- S&P Managing Director David Blitzer discusses the state of the housing market and if we are in a housing bubble with A&G Capital President & CIO Hilary Kramer, Julie Hyman and Matt Miller on Bloomberg Television’s “Street Smart.” (Source: Bloomberg)

Highest gain since 2006. they say the boom could beginning to fade.

We saw this game but you think perhaps that they are going to be gained -- began to moderate.

We will not see the magnitude of the deceleration in the housing prices, correct?

That is correct.

Everyone goes around saying bubble, bubble, bubble.

Suppose someone suspects the worst, 2014 for housing prices comes out looking a little bit like 2008 or something like that.

There is a huge difference the way the economy looks now and the way it looks in 2006 2006- 2007. back then, there were all of these people that bought their houses with no money down.

In fact, they bought them at inflated vices.

They really bought them at 100 20% of value.

All of those folks got washed out.

If you go to buy mortgage yesterday or today or next year, if you get 80% loan-to-value, that is the most you will get.


In fact, they will probably give you a hard time without qualifying.

If the worst happens in a bubble, we are not sitting on this huge mountain of debt which means that everybody's mortgage won't be underwater.

Let me ask you, it is a great point.

We are watching interest rates creep up.

Do we see people rush out and try to get outages?

Is this one of the reasons why people are looking to lock in these prices as they worry about them spiraling up?

I am sure there are many people looking to lock in and a lot of people worried about it but go back to may when the fed sort of spooked us all with quantitative easing and mortgage rates.

Since then, mortgages for purchase, the applications are down.

I get the down applications for refinance performed but for purchase came down somewhat.

Clearly people are nervous about it but some of them are getting squeezed out of the market.

As they watch mortgage rates go up and home prices are probably squeezing a few people out.

We have a 13% increase in home prices in 2013, how much of that was private equity and real estate consortiums coming in and buying?

I do a lot of investing in real estate.

We buy condos and three family homes in the tri-state.

I don't bother to even ask about a mortgage.

It is impossible to get a mortgage even if you have 100 times, literally.

I would love to know.

How much of it as investors and how much of it is people buying residential houses in which to live?

The numbers vary hugely from city to city.

Atlanta has seen by most reports more than any other city.

Most of that is by the rent, by institutional investors which usually means they are buying more than 10 houses the year.

The rest of it is individuals that decide they don't like the stock market for whatever reason and they think a much better investment is to buy a house six blocks away so that they can keep an eye on it.

That is what i would call minimum diversification by people like it as investment nevertheless but there is a lot of that.

My guess is if you go to some place like san francisco which has prices sharply rising you will not find too much of it.

This text has been automatically generated. It may not be 100% accurate.


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