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Real Estate: May 2017

By: Bob Hoye | Friday, May 19, 2017

Our last special comment on US real estate was published in August 2006, just a month after the actual peak in prices. Although not mentioned, the timing was prompted by a rare signal from our Peak Momentum Forecaster. It got over 1.20 signaling that whatever the big speculation was focused on was peaking.

The hottest phenomenon that fateful summer was residential real estate.

By anecdote and price, North American residential real estate has again become highly speculative. This time around, our "Forecaster" is not giving a signal, but the play has become very frothy. As global credit markets reverse to adversity after mid-year, the mania will begin to fail.

The link to the 2006 special study follows:

http://www.institutionaladvisors.com/uploads/9/7/9/5/9795010/bob-hoye-consequence-of-real-estate-bubbles-aug-29-2006.pdf

"U.S. Housing: Going From Good to Great"

- Seeking Alpha, May 8.

"Asian Investors Bullish On US Property"

- Bangkok Post, May 9.

"The housing market is on fire, as sales surge and prices keep rising."

- Wall Street Journal, May 15.

"It'll cost you $2.5 million to live in this mobile home in a trailer park in California."

- Money-ish.com, May 16.

 

Author: Bob Hoye

Bob Hoye
Institutional Advisors

Bob Hoye

The opinions in this report are solely those of the author. The information herein was obtained from various sources; however we do not guarantee its accuracy or completeness. This research report is prepared for general circulation and is circulated for general information only. It does not have regard to the specific investment objectives, financial situation and the particular needs of any specific person who may receive this report. Investors should seek financial advice regarding the appropriateness of investing in any securities or investment strategies discussed or recommended in this report and should understand that statements regarding future prospects may not be realized. Investors should note that income from such securities, if any, may fluctuate and that each security's price or value may rise or fall. Accordingly, investors may receive back less than originally invested. Past performance is not necessarily a guide to future performance.

Neither the information nor any opinion expressed constitutes an offer to buy or sell any securities or options or futures contracts. Foreign currency rates of exchange may adversely affect the value, price or income of any security or related investment mentioned in this report. In addition, investors in securities such as ADRs, whose values are influenced by the currency of the underlying security, effectively assume currency risk.

Moreover, from time to time, members of the Institutional Advisors team may be long or short positions discussed in our publications.

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