The mere mention of a real estate crash to anybody older than 15 might trigger some very bad memories of 2008 – the worst global financial crisis seen in decades.
Despite the unwanted memories and lessons many hoped have been learned, numerous recent reports and studies have found that the U.S. might soon face a similar scenario again.
December 2023 has been particularly bad for the real estate market as sales have dropped a significant 6.2% compared to the same month in 2022 – to lows not seen since 1995 – according to a January 19 report from CNBC.
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U.S. homes unmanageably expensive
Following some well-documented precedents and well-established market logic, the dropping sales and fears of a crash are certainly not an unexpected outcome of the current state of the U.S. real estate sector.
In the final quarter of 2023, Redfin, a firm specializing in real estate, published a string of worrying figures that ultimately concluded that, on average, an American household would have to earn significantly more than the median U.S. household income – as much as $115,000 – to purchase an average American home.
The report came with several additional worrying statistics, including a rather decisive rise in home prices – 15% higher than a year before and around 50% higher than before the COVID-19 pandemic – up to approximately $420,000, as well as the fact that the average U.S. salary is only half of what would be needed to buy a house.
“Rich Dad” Kiyosaki agrees that crash is coming, says it is great for investors
Robert Kiyosaki, well-known investor and author of the best-selling personal finance book ‘Rich Dad Poor Dad,’ is an established skeptic when it comes to the viability and the sustainability of the current financial system.
As recently as January 13, the famous author opined that the U.S. real estate market is not only a bubble but also a bubble about to burst.
According to Kiyosaki, the recent crackdown on Airbnb (NASDAQ: ABNB) apartments in New York City is both a harbinger of the coming collapse and its prologue, as it demonstrates that there is an unsustainable overabundance of units available in the market.
He, however, painted the looming collapse as a major opportunity rather than a crisis, as he opined that every crash is an opportunity to make lucrative investments at a major discount. Finally, Kiyosaki recommended silver – one of his favored assets along with gold and Bitcoin (BTC) – as a hedge against the rising threat.
