The U.S. housing market is gearing up for a double dip according to recent numbers from S&P/Schiller, and experts believe that “the carnage isn’t over” thanks to rising foreclosures and falling home prices[1]. In fact, some economists are actually predicting a “new cyclical low,” says Alistair Bentley, an analyst at the Toronto-Dominion Bank, adding that the 4.6 percent of the country that is in foreclosure will likely continue to “skew the performance of the overall market.”
However, these falling numbers, while not such great news for nationals, are spurring international interest in the United States, where most foreign investors believe that ultimately, their investments will remain sound. In fact, commercial property in the United States remains particularly attractive, with “U.S. real estate delivering the strongest investment performance for 5 years in 2010” according to one international investing firm’s literature[2]. And foreign investors are beginning to dabble in residential real estate as well, snapping up rental properties at low prices that will enable them to generate solid, monthly incomes for relatively low initial costs.
There is a lot of “doom and gloom” out there right now about the housing market, but many investors believe that this is just the part of the process that was artificially delayed by government interference over the past two years. Do you think that this double dip could have been avoided? Is it a necessary evil now?
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[1] http://www.theglobeandmail.com/report-on-business/economy/economy-lab/daily-mix/carnage-not-over-in-us-housing-industry/article1916366/
[2] http://www.eprop.co.za/news/article.aspx?idArticle=13389
