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Housing prices have set new records in the US and other parts of Europe as more and more money and resources help domestic markets continue to tackle the coronavirus epidemic.
The average price of existing US homes rose 23.6% year-on-year and $ 350,300 last month as all regions of the country increased, the National Association of Realtors said on Tuesday.
The European housing market continued to rise despite the challenges of the Covid-19. In the Netherlands, existing home prices have risen by 12.9% in May since last year, the highest increase since 2001, the Dutch Statistics Office said.
The number of real estate units has dropped in the US and the Netherlands, although prices continue to rise, indicating a growing demand for supplies. The Dutch Land Registry reported 16,126 vacancies in May, down 12.1% from last year.
Real estate sales in the US dropped by 0.9% between April and May to an annual rate of 5.8m. The total number of U.S. 1.2m housing units was 20.6% compared to May 2020, the NAR said, although it has risen 7% since April.
Some economists say the decline in sales could be a sign that the US real estate market is booming, with last year’s rise from a record high since 2006.
“The decline in sales and inflation means that the sharp rise in prices is likely to disappear soon,” said Ian Shepherdson, chief financial officer at Pantheon Macroeconomics.
Some see another rise coming, which is encouraged by the point in the central bank. Adam Slater, an economist at Oxford Economics, said: “Lack of funding could lead to a sharp rise in commodity prices, which threatens its recovery.” “For central banks, this is not going well because of rising prices or constant inflation.”
Rising house prices have attracted the attention of US Federal Reserve officials, mainly due to its $ 40bn a month to buy of mortgage lenders, who make up a $ 120bn mortgage program.
Robert Kaplan, President of the Dallas Fed, recently warned prices were on “old” rates and indicated the purchase of more real estate with investors. Blackstone, a secret fund management unit, Tuesday he agreed $ 6bn agreement to acquire a Home Partner of America, a buyer and seller of family homes with a history of more than 17,000 homes.
“More and more, single-family consumers are being lured into the market,” Kaplan said at a ceremony held Monday with the Official Monetary and Financial Institutions Forum, a think tank. “At the moment, we are skeptical if the housing market really needs the Fed’s $ 40bn a month subsidy.”
James Bullard, President of the St Louis Fed, said it would immediately be time to consider whether to retire from MBS.
The European Central Bank said reports this week that in the fourth quarter of last year house prices euro rose 5.8% last year – the highest interest rate since mid-2007.
It added that Germany, France and the Netherlands accounted for about a third of the country’s gross domestic product last year.
Rising prices and declining affordable housing have caused public outrage among many homeowners in several European countries. Ireland forced a 10% fine for anyone who buys a house 10 or more for 12 months to prevent the financiers from buying more property.
In Germany, what was planned Including € 18bn Among Vonovia, the country’s largest landowner, as well as its Deutsche Wohnen counterpart have raised calls for loans to repatriate companies and even set them up abroad.
The issue of pricing has also become a hot topic in criticism of the ECB’s immutable policies. Their president Christine Lagarde was questioned about this in the European Parliament this week.
“Young people and middle-class families are being forced to take part in rats’ competitions, which are rampant in the hot house market,” said Michiel Hoogeveen, MEP for Eurosceptic Dutch. “These are just some of the consequences of coming home without money and low interest rates so that poor countries can operate more effectively.”
In response, Lagarde said “there are no strong signs of [a] a house with a lot of money in the whole euro zone ”but added that there were” real estate problems “in some countries and in other cities.
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