If your one of the people reading things like this scratching your head asking "How? Why? Who's doing this? I wanted a "crash", where's my "crash"?" let me shed some light and answers on that point, as I am one of the "market makers" actively engaged in this here & now.
I won't waste time touching on all the answers, just the ones I all but never hear anyone mention.
First and foremost, institutional $ is engaging on a level I have not only never seen before, but also never heard of ever, and that everyone I know of also says the same, never seen or heard of such epic level activity. Now, keep in mind, I am talking 1st hand knowledge, this is not from some report I read, this is the "now" activity in our brokerage, the things I see and NDA's don't allow to speak of. It's gargantuan.
Next, and this kind of touches on the first. I have a LOT of "new" Real Estate Investors starting, who have been long term Wall Street Investors. Yes, they are transferring and reallocating there investment capital. We have massive level inflation, that no it is still not done and WS Investors know exactly what I am talking about. R.E. is "the" hedge against inflation, so it's a simple risk-analysis of 1 vs the other. Next we simply have the obvious of returns, R.E. is out performing W.S., it's just that simple.
So in all this doom & gloom forecasting so many media-4-profits have done, well they were using tunnel vision and forgetting ALL the factors. Short version, there is many more forces for acquiring real estate today, than not to. From there it's simple grammar school math; if Johnny has 4 apples, and 10 people want apples, what kind of discount will Johnny give them?
As rents climb, it makes the "expensive" purchase option more affordable, because purchase affordability is PERCEPTUAL, weighted off income ADN the cost of alternative housing ie renting. When it's CHEAPER TO BUY/OWN vs renting, yeah duh, people strive to buy.
Next, as W.S. volatility grows and faith in returns decline, R.E. investments simply look all the more safe, secured and assured. Not to mention as alternative options to W.S. increase, example BlackRock via acquisition of Home Partners and the similar, YES you will see MUCH MORE activity via institutional segment.
Last but not lease, SUPPLY. Housing does not take months to create supply, it takes years, many years because production output takes years to ramp up production. These are SKILLED trades we are talking about, that again, require YEARS of training to achieve full per-head output. And right now today we have historic SHORTAGE of skilled labor in the trades. And it's not getting better, it's getting worse as avg. age of skilled trades person keep going UP.
So welcome to the new norm. It's no surprise to me, it's actually an obvious outcome in my book because we "The People" have put sock-puppets in charge of all top level decision making, and they have literally 0 intelligent experience or credentials. What would happen if put a valet in charge of Hilton? Yeah, well that's what we have, complete morons in charge of government, is it so hard to assume bad things will come of it?
Do you know why Tesla has done what Tesla does? Because a guy capable of building paypal ran it. Capable intelligent people retain capable intelligent people and down the line it goes. Circus clowns in charge tend to what, build a brain-trust team? No, they put a circus together, duh.
Why any expect prices to fall like a stone, in reaction to MASSIVE inflation event, with a leadership cast like that of a Mtv reality show........
The real "crash" is in common sense.
