MarketWatch has done something recently that few have ventured to do in the past. They have reported potential future risks of the housing market that seems to be even more in flux as of late.
We?re all familiar with the housing market crash of 2008. Unfortunately some of us are too familiar; some having to file personal bankruptcy or have their homes go into foreclosure in the bad economy.
This new report shines light on future risks to an already unstable market.
The report, officially done by a group aptly named The Counselors of Real Estate, outlined the risks of the market for the next 10 to 30 years.
Baby Boomers
The aging population of America is something to keep an eye on in regards to the housing market. Increases in demand for retirement homes and commercial real estate will be affected with storefronts turning to healthcare facilities to facilitate their elderly health needs.
Student Loan Debt
High ratios of debt to income levels are already making their mark on the housing market. Young graduates don?t have the ability to purchase a single family home and are moving in with their parents at an alarming rate. If this continues, many won?t be able to purchase a home of their own until years down the line; affecting the housing market negatively.
Public Funding
Retirement programs, led by government spending (or lack thereof) are causing a problem for the housing market. Infrastructure costs will also be a burden as roads and storm drains will need to be updated accordingly.
Office Space
Many people are choosing to work form home now in an increasingly digital world. This causes the demand for physical office space to go way down.
Retail Space
Just as the prospect for office space has been dwindling, retail space has suffered on account of the Internet shopping habits of Americans. Brick and mortar stores are falling victim to the online shopping boom.
Liquidity in the Real Estate Markets
Many commercial real estate loans are in need of refinancing. Hundreds of thousands of dollars in loans are at risk because there are fewer brokers to offer the capital to service the loans.
Globalized Factors
In the wake of the technological divide, the world is connected and each country affects the other when drastic things happen. The European crisis and China?s economy has had an effect on companies who occupy retail and commercial space.
Sustainably Green
As more and more companies fight to keep their heads above water, many are turning to sustainable energy and other green tactics to ensure their survival. Experts say to expect this trend to continue in the competitive real estate market.
Overvalued Property
Properties that are seemingly in the best locations and have the best value are actually becoming overvalued due to the influx in investors to ?sure thing? properties.
Never Talk Politics
To solve dire needs in the housing market, a political agenda needs to be established and bipartisanship is the key that opens that door. When both sides can?t agree on a call to action, we all lose according to the experts.
Source: http://www.clearbankruptcy.com/blog/the-future-of-the-housing-market-10-high-risk-variables/
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