As a member of Leading Real Estate Companies of the World, we are privy to global economic insights from LeadingRE’s Chief Economist, Marci Rossell, who takes complex economic issues and makes them relevant to buying and selling real estate. In this edition, we are covering Rising Home Prices and Affordability.
Home prices have skyrocketed causing an affordable housing crisis in many parts of the globe, particularly with first time home buyers. To help make housing more affordable, some governments are taking action by placing restrictions on the purchase of real estate. In addition, market-based solutions are occurring
MEASURES AIMED TO SLOW RISING HOME PRICES
- Restrictions may keep some foreign buyers from purchasing homes.
- To control home prices, some countries are purchasing property.
- New companies have emerged with creative solutions and programs to help homebuyers with a down payment or make monthly mortgage payments. In return, when a buyers sells the property, the appreciation is split.
- Another example is a start-up in Seattle, Washington, USA, helping homebuyers come up with a down payment in exchange for a share of Airbnb revenues that the property generates.
Expect to see more innovative market-based solutions occurring, providing a better answer to affordable housing without causing home values to decrease or be suffocated in the long run.