A top real estate consultant’s current analysis of the U.S. housing market is bleak.
Nick Gerli, CEO of Reventure Consulting and Reventure App, claims that a “massive housing bubble has developed and is about to pop in the South,” which includes top homebuilding states like Texas, Florida, and Tennessee. His analysis shows that the last time Americans saw numbers this bad was right before the 2008 market crash, which led to millions of homeowners defaulting on their home loans.
“The number of new homes for sale in the Southern Region has spiked up to nearly 300,000. This is the highest level of all-time. Even higher than the previous bubble peak in August 2006. Before the massive crash,” Gerli said. “Many people want you to think ‘this time is different’ in the housing market. It isn’t.”
11) Make sure to pay attention to inventory and price cut levels in your local housing market. Those are two of the most important data points in terms of understanding the trends.
You can access them at https://t.co/yTZTC7FPDB.
You’ll want to see how your area compares to…
— Nick Gerli (@nickgerli1) July 8, 2024
Southern homebuilders are building homes at high rates and faster than they can offload now that new home sales have dropped below pre-pandemic levels. “The result is that the ‘Months of Supply’ on builder lots in the South has spiked to almost 9 months. This is one of the highest levels on record,” Gerli said.
The fear is that overpriced homes, coupled with the abundance of inventory on the market, will force these investors to sell their portfolios, creating a recipe “for a major housing downturn.” The biggest issue these builders have is that most buyers are still priced out of the market due to overvalued properties and high rates, meaning that selling these homes is becoming increasingly difficult without drastic price cuts. (ROOKE: Gen X And Millennials Ditched ‘Hope And Change’ For MAGA In Just 16 Years)
He doesn’t expect this bubble to hit the Northeast or Midwest, where home building didn’t reach peak numbers like the South’s. The South became a popular region for Americans to relocate from when the pandemic was raging, and Democrat-controlled states were running rampant with Covid-authoritarianism. Bidenomics made it impossible to buy a home, and now, if you could afford an overpriced property with a high rate, there is no end in sight for the financial boot on your neck, especially if homeowners were banking on being able to refinance.
