Boom, Bubble or Bust?

With plenty of buyers and not enough sellers, the real estate market is making investors nervous. [Shield] AN OXFORD CLUB PUBLICATION [Profit Trends]( [View in browser]( SPONSORED [David Fessler Called Tesla at $8 (Split-Adjusted). His New 5G Recommendation Could Be Even Bigger...]( [5G]( This 5G company has EVERYTHING going right for it: a top-shelf management team... scores of patents... dirt cheap shares... partnerships with ALL the big telecoms... and a technology that could fast-track 5G in a MAJOR way. [Get the scoop here.]( Editor's Note: Nationwide 5G coverage has been in the works for years... But at the end of the day, we won't ever see it completed without one company's patented device. This means that investors who get in on this mystery company have the potential to see their profits SOAR. But if you're interested in investing, you need to move quickly... A watershed event on December 22 could spark a surge in this company's stock. [Click here to learn more.]( - Kaitlyn Hopkins, Assistant Managing Editor --------------------------------------------------------------- [Is the Real Estate Boom a Bubble Ready to Burst?]( [David Fessler | Engineering Strategist | The Oxford Club]( [Dave Fessler]( Buying a house or condo is a great way to diversify an [investment portfolio](. But for the past several years, the real estate market has been a challenging place for buyers. The lack of available homes was a problem even before the pandemic hit. And COVID-19 has only made it worse. Home prices are at all-time highs, and the market has never been more competitive. So now we have to ask this: Is a [housing bubble]( imminent? And if it is, when will it pop? A Recipe for Trouble Many of today's buyers are purchasing properties to take advantage of ridiculously low interest rates on mortgages. Others see the pandemic-induced [work-from-home culture]( as a reason to invest in their homes. This increase in demand has driven prices higher. Bidding wars are more common than they've ever been, especially in desirable areas. This has led some buyers to waive home inspections, which is something that never happens in a normal market. And some buyers are making offers in cash - for above the list price! Now, there's a simple reason this is happening. In the U.S., the supply of available homes is 5.24 million houses short of what is needed. Workers haven't been able to build houses fast enough. And [supply chain issues]( have also hit the homebuilding sector. In fact, contractors are paying 23% more for materials than they did last year. That makes it more difficult to build. To top it all off, builders are facing a lack of labor. So far, only 80% of homebuilder jobs lost during the pandemic have been refilled. 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He claimed that when the next bubble bursts, new buyers would lose all the equity in their homes. Now, if there were a bubble and it burst, that would be true. But this isn't a bubble. Demand is slacking off a little, but it's still there. And [the shortage]( of available homes isn't going to improve for years. It's hard to find others who share Boockvar's view that a housing crisis is just around the corner. (In his defense, no one could have predicted what happened in 2008 either.) Still, there are a few concerns to keep an eye on. Back in 2005, before the last bubble burst, housing prices saw a 14.4% year-over-year gain. Year-over-year price increases today are at 19.9%. They've been setting [new records]( every month since April. And Goldman Sachs forecasts prices will rise another 16% by the end of next year. There's no question that [higher prices]( will eventually slow demand, even with today's low interest rates. To Buy or Not to Buy? As I said above, I don't believe we're in a housing bubble. But I certainly believe that we are in a housing boom. Now, housing prices will eventually [correct and drop](. This could even happen in the latter part of next year. If you are a first-time homebuyer and can wait, you'll likely get a better deal a year from now. The downside is you might pay a mortgage with a higher interest rate. But as the old saying goes, when it comes to real estate, they're not making any more of it. Remember, things are different from how they were in 2008. Prices will eventually correct, and we could see a drop of 5% to 10% going into 2023. But prices won't be dropping anywhere close to the dramatic 26% they did back in 2007. So don't panic... I don't think we're in for a real estate crisis anytime soon. Good investing, Dave P.S. I have found a company that is perfectly positioned to spearhead the 5G revolution. In fact, its 5G revenue is already up a whopping 182% year over year! 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