Submitted by Michael Krieger of Liberty Blitzkrieg
I tweeted the following a few days ago:
I can sum up the housing market like this. Rich baby boomers with PE firms outbidding each other as they enter the dementia phase of their lives.
I firmly believe that the above statement sums up what is now the primary backbone of the latest housing bubble. Alas, there is more. On top of these boomers that know nothing other than housing and financial speculation, there is a flood of foreign money, in many cases criminal money, being laundered into U.S. real estate. We now discover that this foreign cash is now preventing regular citizens from buying or even renting in the San Francisco Bay Area. From Mercury News:
His agent, Sharmila Banerjee, said that “cash is coming from China, India, Russia, but there can be difficulties transferring money from outside the country.” When one such deal fell through, another one of her clients had his offer accepted, she said.
Real estate agent Melissa Haugh said everyone in her office was stunned at the price, paid in cash, for a Santa Clara fixer-upper. “The house had a rat infestation, there were holes in the walls, windows that leaked, mold around windows, water damage to floors. It needed $100,000 in work,” she said.
Read the rest here.