Reply to Is there another "housing bubble"?

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Reply to "Is there another "housing bubble"?"

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[quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous]I don't think there's a bubble per se, but I do think flippers are essentially stripping the equity out of some neighborhoods by charging up to the very limit of what the market will bear. [/quote]

That's what always happens, what do you suggest, they lower prices?[/quote]

why does that strip equity?[/quote]

Because A) they are raising prices by having a monopoly on the cheap housing stock and b) raising those prices further by doing "renovations" that may be unnecessary, that then mean that you are not going to be able to have the same appreciation that you might have had. Basically, the equity is going into the pockets of the developers rather than homeowners. [/quote]

Sorry, that is an illogical argument - and certainly does not "strip" equity or create an asymmetrical market dynamic.

-Wharton MBA[/quote]

Ok Wharton MBA.  What's your definition of "stripping" equity?  Maybe mine does not conform exactly to the current definition, but you know very well what I mean.  It's a market failure pushing up prices, but not providing value.  Flippers are controlling the market of unrenovated houses, and now you have to pay practically a 100% markup to buy into those neighborhoods.   I believe this could result maybe not in a bubble per se, but in over-valuation of houses in some DC neighborhoods. [/quote]

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