Pity the millionaire: Mansions in short supply
As the US housing market rebounds and confidence builds, $1 million-plus homes are now scarce.
According to CNBC, the U.S. is suffering from a mansion shortage. Housing inventory in the 90 wealthiest ZIP codes in the U.S. has fallen by 15% over the past year, according to a study CNBC cites from Atlas Research. Available homes selling for $1 million-plus have plunged by 70% in Palm Beach, Fla., and supplies are tight in Old Greenwich, Conn.
As tough as it is for the wealthy, this is good news for the overall economy. The National Association of Home Builders estimates that building an average new single-family home generates 3.05 jobs and $89,216 in taxes. Bigger homes, of course, have bigger economic footprints, as does remodeling. Applications for building permits hit a five-year high in April.
The surging U.S. real estate market is attracting investors from around the world. Americans are in a mood to buy as well, thanks to a higher stock market this year and rising consumer confidence. Housing prices soared by almost 11% year over year in March, the largest such monthly gain since 2008.
Some observers, however, are already worried that housing is in a bubble that's bound to burst.
"If prices keep going up at this rate for another six months, we will have a bubble, and people will get hurt," Dean Baker, a co-director of the Center for Economic and Policy Research in Washington, D.C., said in an interview with Bloomberg News.
People who now have to wait to find the home of their dreams should be thankful they don't have more serious problems.
Follow Jonathan Berr on Twitter @jdberr.
How can this be? Get congress on this problem, ASAP. We can't have the super rich lving in the burbs!
What a shame that they don't have enough multi-million dollar, 15,000 square foot houses in gated communities for them so that they can live peacefully away from the commoners.
As a former Lender who once worked for a major bank and GOP PAC contributor... I can tell you that "estate" housing is kited. Homes are rarely listed outside a specific circle of Realtors, rarely financed outside a specific group of mortgage originators. We already know by FACT that estates do not enter the traditional default to foreclosure to repossession to auction process. A deep pocket is contacted and the house leaves the process early on. THINK about it... big homes are generally outside of the realm of business and commerce. Those communities are gated, heavily reliant on drive time and for Elitists who collude to keep their status. So far- the administrative roles that should have gone before the workforces are rock-solid and gaining wealth AND their dreamer estate homes are in low demand while the ACTUAL economy is literally destitute. Any odd thought of WHO got all that Bernanke QE? Any odder thoughts of how far these lowlife losers will go to ensure we keep floating them?
CASH OUT, kids. Watch the "pretty" people Twit their way to Oblivion. Sell hand baskets, they will be needed.
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