11/25/2023 0 Comments Boise housing bubble 2021With a scarcity of available homes and intense competition among buyers, home prices witnessed another surge in May. Some old-line VC firms are now feeling more pressure to move quickly, "cutting back on audits and customer checks, and taking a startup's word on profit and losses. In order for that to happen, Boise would not only have to lose all of its 2022 gainswhich is already starting to happenbut also fall under its December 2021 price. Jby Marco Santarelli The Boise housing market has experienced significant changes and trends in recent months. Three-quarters of it has been invested by "hedge funds, mutual funds, pensions, sovereign-wealth groups, and other nontraditional venture investors" who have been left with "massive pools of capital" thanks to the IPO boom. Most of that cash has not come from traditional venture-capital firms. In total, $150 billion was invested in startups in the first half of 2021 - more than the amount in any full year before 2020. Giant money-management firms are on pace to double last year's record in startup financing, said Heather Somerville at The Wall Street Journal. The swift inventory spike explains why there's no shortage of national research firms predicting that. Reining in the Fed's spending because of housing specifically, however, could "slow the overall economy" and lead to job losses. In July, Boise inventory was 141 above July 2021 levels, and 34 above July 2019 levels. Some feel that the central bank's big purchases of mortgage bonds "could be helping to inflate" the market by keeping mortgages cheap, "inspiring people to borrow more and buy bigger." That's leading to bidding wars and frustration among buyers eager for more space. "Several of Kaplan's colleagues harbor similar concerns." Home prices are rising at a double-digit pace this year. Robert Kaplan, president of the Federal Reserve Bank of Dallas, said last week that he was becoming "nervous" about the conditions of the housing market. Some Federal Reserve officials are concerned that the housing boom is beginning to look like a bubble, said Jeanna Smialek at The New York Times.
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