Yes, thats right, I said the 'S' word. The market is being flooded with foreign speculators that are once again causing prices to be driven up for Jane and John Doe. Whats peculiar about this Real Estate market rebound is that it is happening primarily in upper-middle class to high-end neighborhoods. If you pay attention to the Real Estate markets of the city, you'll notice that the lower-end neighborhoods and ghettos are not experiencing any kind of appreciation what-so-ever. As a matter of fact, there are still many abandoned and condemned houses lingering around in those areas.
If we take a trip back about a decade from 2015, you'll see that prices where skyrocketing everywhere. People in the inner city were getting rich, albeit temporarily as they'd splurge all the money they'd receive from proceeds of sales on 24's, from selling off their properties. Their clients included a mixture of people getting scammed by mortgage brokers, international investors, speculators, companies and clueless newbies. Now, just because this has all happened in the past does not mean that this same group of people don't still exist, they do, but they still don't have any purchasing power as lending is still pretty tough in this market.
Now, what we've been seeing are a lot of hedge funds coming into the market and buying properties. This is probably occurring because they're seeing prices rise due to activity from these cash-buyer speculators from Europe, Asia and South America. These hedge funds are more interested in seeing higher returns in Real Estate because the stock market has not been treating their capital very nicely in the last couple of years. Wall Street is coming back to the market again but this time its not in the form of mortgages, equity lines of credit and other kinds of loans. Now, Wall Street is pouring their money directly into Real Estate and completely cutting out the consumer.
Eventually things will cool off and wall Street will retreat to the stock market once again. In the mean time there are plenty of opportunities regardless of what is happening in the market, you just have to know what you're doing.