4 ms·
These don't indicate overbuilding. It just means you are off the cliff as soon as your cash flow turns negative. Buying a house in this area is like condemning
by EternalFury 13y ago
These don't indicate overbuilding. It just means you are off the cliff as soon as your cash flow turns negative.
Buying a house in this area is like condemning yourself to walk around with a huge sword hanging above your head.
- muzz 13y agoIf declining prices-- as what happened from 2007-2010-- don't indicate overbuilding, what does? Anything?
- pchristensen 13y agoDeclining prices are much more due to changes in the economy (in this case, a recession), not the housing supply. Aggregate incomes and wealth dropped a lot during that time. If you were looking for something that indicated overbuilding, I would look for declines in the ratio of rents/sale prices to median metro income. If housing is getting cheaper compared to incomes, that means supply is catching up to or outstripping demand. This could happen regardless of boom, bust, or stagnation. See http://www.usnews.com/news/best-cities/slideshows/the-10-most-affordable-places-to-buy-a-home http://www.usnews.com/news/best-cities/slideshows/the-10-mos... and http://money.cnn.com/gallery/real_estate/2012/11/29/least-affordable-cities/index.html http://money.cnn.com/gallery/real_estate/2012/11/29/least-af... for examples.