Skip to content
Trending
July 6, 2022Women could help drive Bitcoin to $250k, saysTim Draper December 15, 2021The Federal Reserve is expected to take a very big step toward a rate hike February 16, 2022‘Everyday Millionaires’ author says these are the five things that most millionaires have in common January 12, 2023American Airlines shares jump after airline hikes revenue and profit outlook July 24, 2022Twitter misses earnings expectations, partially blames revenue drop on Elon Musk takeover bid January 14, 2022Bill Ford is doubling down on Ford shares, and quietly amassing more control of his grandfather’s company in the process November 18, 2022Fed’s Collins expresses hope that inflation can be tamed without hitting jobs March 24, 2023One of the best ways to figure out what the Fed will do next is to look at regional bank stocks February 6, 2023Ford posts full-year net loss, ugly fourth quarter as ‘execution issues’ plague operations January 5, 2023Bed Bath & Beyond shares plummet after company warns of potential bankruptcy
  Sunday 4 June 2023
everydayread.net
  • HOME
  • Bitcoin
  • Business
  • Earnings
  • Economy
  • Finance
everydayread.net
everydayread.net
  • HOME
  • Bitcoin
  • Business
  • Earnings
  • Economy
  • Finance
everydayread.net
  Finance  Home affordability at 2007 bubble levels, but crash is unlikely: Blackstone’s Joe Zidle
Finance

Home affordability at 2007 bubble levels, but crash is unlikely: Blackstone’s Joe Zidle

AdminAdmin—May 17, 20220

A major Wall Street firm is drawing a striking parallel to the housing bubble.

Advertisement

Blackstone’s Joe Zidle calls homes almost as unaffordable as the 2007 peak. Yet, he believes a crash is unlikely due to a major difference: Most owners aren’t using their homes like an ATM.

“That caused so many people to go upside down,” the firm’s chief investment strategist told CNBC’s “Fast Money” on Monday. “The value of what they owed was greater than the value of their home.”

Unlike the housing bust, Zidle adds home equity is at an all-time high and household balance sheets are strong.

“You haven’t had overbuilding. You haven’t had a drop in credit or lending standards,” he noted.

More stories

San Francisco Fed leader Daly likely not a major player in SVB saga, officials say

April 3, 2023

Stocks making the biggest moves midday: First Republic, FedEx, Nvidia, Bumble & more

March 18, 2023

Stock futures rise as market attempts to extend comeback rally to a third day

December 23, 2021

Stocks making the biggest moves midday: JPMorgan Chase, Albertsons, Tesla, Beyond Meat, Delta and more

October 15, 2022

Blackstone is known for buying scores of distressed residential properties tied to the 2008 financial crisis. It’s still a major player in real estate, with investments in rentals, the rent-to-buy market and student housing.

“Because you have very little excess in housing, I think you end up having less risk,” he said.

Plus, Zidle cites a strong jobs market.

“Historically, housing ends up being more highly correlated to labor markets than it is to mortgage rates,” he said. “As long as the jobs market remains relatively healthy, I think housing will as well.”

His forecast comes as Wall Street gets ready for key reports this week on the consumer and housing. Investors will get earnings from major retailers including Walmart, Home Depot, Lowe’s and Target. Plus, numbers on homebuilder sentiment and home sales are due.

Zidle’s call reflects a 12-month time frame. Within that horizon, he sees the Federal Reserve hiking interest rates deeper into next year than the Street anticipates due to persistent inflation.

“Ultimately, the Fed is going to have to hike interest rates until something breaks,” added Zidle. “When we do get to a point where something breaks, I don’t think it’s housing.”

He expects the benchmark 10-year Treasury Note yield to hit 3.5%. It’s a level he expects the housing market to handle. On Monday, it was around 2.8%, up 90% so far this year.

“You might see home prices generally flatten out. You may have pockets of weakness where home prices in some regions might fall,” Zidle said. “But the idea of having a national and a prolonged drop in housing as the economy eventually rolls over, I think is still a relatively low probability.”

Disclaimer

Advertisement
JetBlue launches hostile takeover bid for Spirit Airlines
Chinese e-commerce giant JD beats estimates despite slowest quarterly revenue growth on record; shares pop 8%
Related posts
  • Related posts
  • More from author
Finance

Crypto bill from Republicans lays out clear roles for SEC and CFTC

June 3, 20230
Finance

Stocks making the biggest moves after hours: Lululemon, MongoDB, Five Below and more

June 2, 20230
Finance

TripAdvisor rival GetYourGuide nears $2 billion valuation as it raises fresh funds to invest in A.I.

June 1, 20230
Load more
Read also
Finance

Crypto bill from Republicans lays out clear roles for SEC and CFTC

June 3, 20230
Economy

Unemployment dropped among Hispanic men and women in May but rose for Black workers

June 3, 20230
Earnings

MongoDB shares jump more than 20% after database company beats expectations and raises guidance

June 3, 20230
Business

Buy Buy Baby draws sale interest in Bed Bath & Beyond bankruptcy, one bidder looks to save stores

June 3, 20230
Finance

Stocks making the biggest moves after hours: Lululemon, MongoDB, Five Below and more

June 2, 20230
Economy

Here’s what to watch out for in Friday’s jobs report for May

June 2, 20230
Load more
    © 2022, All Rights Reserved.
    • About Us
    • Advertise With Us
    • Contact Us
    • Disclaimer
    • Cookie Law
    • Privacy Policy
    • Terms & Conditions