The World In Pictures {06.29.17-Housing}

For much of the next month  I'm going to take a look at some charts or graphs that I think are important to understanding not just the investment markets but also the modern economy and the current state of the world.  These bigger picture views let us develop a broader interpretation of where things stand in a world that is rapidly changing.  Sometimes I'll have commentary and other times all let the charts talk for themselves.  Note that some of these, especially in the beginning of this series come from some of the brightest minds in the investment business today.

Today's chart takes on housing and is from Svenja Gudell, the Chief Economist at Zillow.  The chart comes from an article over at BusinessInsider.com.  The commentary under the chart comes from the article linked below.

"There are big differences between the market then and the market now: Then, loose credit, speculation, and overbuilding were ingredients in a recipe for disaster. Now, healthy home buyer demand is being driven largely by a stable economy and demographic tailwinds, which is exactly what we would expect in a healthy market. Supply has been slow to catch up to this demand, which is causing home values to grow at a faster clip than we might otherwise expect. 

Beyond that, the market's fundamentals look largely healthy. Homes are largely more affordable in most markets today than they were prior to the bust, and will remain so for the foreseeable future, even if mortgage rates rise. Americans clearly continue to see the value in homeownership, especially young Americans, which bodes well for the future."

My comment:  I largely agree with Svenja's view on housing.  There's a whole pent up generation of millennials that are starting to form families and will need to look for a home.  However, I'll note that she might be a bit biased since she works for a company that advertises homes for sale on the web.

Back Monday.

Link:  Business Insider: "PRESENTING: The most important charts in the world from the brightest minds on Wall Street"