by Calculated Threat on 1/09/2025 11:44:00 AM
As we speak, within the Calculated Threat Actual Property Publication: Replace: The Housing Bubble and Mortgage Debt as a % of GDP
A short excerpt:
Two years in the past, I wrote The Housing Bubble and Mortgage Debt as a % of GDP. Right here is an replace to a few graphs. The underside line stays the identical: There won’t be cascading worth declines on this cycle as a consequence of distressed gross sales.
In a 2005 submit, I included a graph of family mortgage debt as a % of GDP. A number of readers requested if I may replace the graph.
First, from February 2005 (20 years in the past!):
The next chart exhibits family mortgage debt as a % of GDP. Though mortgage debt has been growing for years, the final 4 years have seen an amazing enhance in debt. Final 12 months alone mortgage debt elevated near $800 Billion – virtually 7% of GDP. …
Many owners have refinanced their properties, in essence utilizing their properties as an ATM.
It would not take a RE bust to impression the final economic system. Only a slowdown in each quantity (to impression employment) and in costs (to decelerate borrowing) may push the final economic system into recession. An precise bust, particularly with all the in depth sub-prime lending, may trigger a significant issue.
And a significant issue is what occurred!
There’s far more within the article.
