California housing enjoys strong fundamentals but faces potential headwinds

Housing fundamentals are strong, but if they get too strong, rising mortgage rates will spoil the fun.


Signs of a strong economy are all around us. U.S. retail sales rise, and inflation posts largest gain in four years. Unemployment is near historic lows, and Trump plans to dump fuel on the ...

California housing enjoys strong fundamentals but faces potential headwinds

Some homeowners wisely take a step down the property ladder

Escaping an onerous mortgage can be the best thing for a family’s financial and mental health.

I feel bad for loanowners (AKA underwater borrowers). When I started blogging in February of 2007, I felt a sense of urgency to convince as many people as I could they shouldn’t buy a house. I k...

Some homeowners wisely take a step down the property ladder

Consumer debt is a deadly parasite

Warning! Don’t read today’s post if you have a weak stomach or a strong affinity for consumer debt.
This is your only warning.

Hang on, Alice, as we bolt through the rabbit hole on an adventure to financial Wonderland. Come with me on a fantastic journey to the Great Lakes to save fish falling p...

Consumer debt is a deadly parasite

Low house prices provide an economic boost

Low house prices make for lower debt service payments that benefit the economy as money is liberated to circulate and buy goods and services.

Low house prices benefit everyone because low house prices make for low loan balances and less debt-service. When borrowers carry excessive home debt,...

Low house prices provide an economic boost

Will rising mortgage rates lead to housing stagflation?

Lower house prices due to higher mortgage rates still result in a higher cost of home ownership.

Everyone shopping for a home wants to see lower prices. For most products, paying less for it means the buyer keeps more money to purchase other goods and services, but with houses, this isn’t n...

Will rising mortgage rates lead to housing stagflation?

Nine percent of US homeowners lost their homes over the last decade

The homeownership rate is plunging because the housing bust tarnished the American Dream dream, and a new generation chooses to rent instead.

For nearly 100 years, US government housing policy maximized the homeownership rate and the rate of growth in house prices. Politicians characterized...

Nine percent of US homeowners lost their homes over the last decade

Government policy should better accommodate renting as a lifestyle choice

We need policies that help stabilize tenancy and facilitate renters saving for retirement.

The US government treats renters like second-class citizens. Our current policies make it very difficult for renters to stabilize their housing costs or save for a comfortable retirement. Perhaps in an...

Government policy should better accommodate renting as a lifestyle choice

Nearly 75% of loan modifications fail within two years

Loan modifications always had high failure rates, but modifications since 2014 fared worse than bubble-era loan mods.

Every attempted loan modification delays a foreclosure, keeps an overextended borrower in a state of debt servitude, artificially props up home prices, and keeps much-needed...

Nearly 75% of loan modifications fail within two years

Mortgage rates will rise when the Federal Reserve stops buying mortgage bonds

The Federal Reserve’s oft-forgotten policy of buying mortgage-backed securities helped keep mortgage rates low over the last several years.

The monthly housing market reports I publish each month became bullish in late 2011 due to the relative undervaluation of properties at the time. I...

Mortgage rates will rise when the Federal Reserve stops buying mortgage bonds

The real estate negotiation technique Trump uses as President

Donald Trump uses executive orders like land acquisition professionals use letters of intent.

When I first saw the headlines touting Donald Trump’s repeal of Dodd-Frank by executive order, I literally laughed out loud. I wondered, who does he think he is, Emperor Trump? Does he really...

The real estate negotiation technique Trump uses as President

Affordability is the major housing market headwind of 2017

Home price affordability will be the biggest issue in housing in 2017, particularly if mortgage interest rates rise.

Over the last 40 years, California inflated three different housing bubbles. Starting in the 1970s with regulations like CEQA, California began to restrict growth. This inhibited...

Affordability is the major housing market headwind of 2017

California"s housing policies hurt the working poor the most

Californians embraces housing policies that benefit high wage earners and homeowners over the working poor.

House prices in California surpass most of the rest of the United States both in real terms and relative to local income. Residents offer many bogus reasons for high house prices —...

California"s housing policies hurt the working poor the most