11/08/2005

Is The Housing Boom Finnally Over?

It appears the while the real-estate bubble has not burst; it is starting to show signs that it is leaking. With the Fed continuing to raise interest rates and with the high price of oil, the housing market is starting to slow down. Some of the countries biggest builders have been scaling back and their stocks are starting to take a beating on Wall Street. At this point in my life the housing market is a big interest to me. I will be graduating soon and I'm wondering if I'll be able to afford a house. With the way real estate, especially here in Southern Utah, has been skyrocketing, I am hoping that by the time I am ready to buy that there will be something decent left for me. Does this concern anyone else?

5 comments:

maddy said...

I'm sure that the housing market will slowly lose steam as interest rates increase and if fuel prices stay high. Four years ago when I started at SUU I wished I had known what changes that be happening in our own backyard. I'm interested to see what the next ten years will bring, especially because it seems to me that there are many economic factors playing into the growth of our "little city". If the majority of those people moving to Cedar City are older, retired persons from more affluent coastal areas it may prove a problem as housing costs go up and up and those people don't contribute to the labor force, or support the industry already established, unless of course they happen to love Mexican food. I have already heard of one family who stayed only a short time before realizing that their dual-income in fairly good jobs could not afford the cost of building a home.

Alex said...

I've thought about this a lot as well Jasmine. What if I don't get a job right after I graduate, but my spouse and I are ready to buy a house? Can i afford it? Will I be able to make payments? I get nervous just thinking about it. Hopefully Maddy is right and the the marke does start slowing down.

Liz said...

I don't think that it will slow down for a long time. I keep up on the construction here in Cedar City and it is rated as the 10th fastest growing city in the US right now. The property values continue to go up which invites investors to invest here which will only continue the growth pattern.

Dr. Tufte said...

-1 on Jasmine's post for punctuation errors.

-1 on Maddy's comment for grammatical errors.

-1 on Liz's comment for spelling errors.

Personally, I don't think the housing boom is over at the national level. There is a lot of weak or incomplete analysis on this. I think about it this way: every person with a self storage unit needs a bigger house. I see no sign of let up in self storage.

Certainly the boom is not over in Cedar. The fixed factors that attract people to Cedar - breathing room, scenery, weather, festivals, sunshine, SUU, I-15, proximity to Las Vegas - are just not going away.

Dr. Tufte said...

-1 on Jasmine's post for spelling errors as well.