A real estate investor has witnessed the “greatest” correction in the industry he has ever seen.
Grant Cardone, a private equity fund manager, spoke to FOX about the current state of the real estate industry on Thursday, said: “I’m just going to say that I think we are entering the biggest correction in the history of my life.”
It’s going to be an amazing opportunity for people, ordinary, everyday individuals to grab trophy real estate. Cardone stated that this had never occurred in the United States.
He said, “It will be epic.”
Cardone may claim that the housing industry has entered a new territory but the current market is still a difficult one for buyers and sellers alike. Interest rates are high, as are housing costs. Low inventory is a result of sellers not entering the market. This leads to a worsening problem and higher home prices.
Cardone said that it was “unaffordable” for most people to buy a house today while accusing the Federal Reserve of “single-handedly” destroying the housing market through interest rate increases.
“He (Fed chairman Jerome Powell) has not controlled inflation. He has failed miserably. The real estate investor stated that what he had done was to create and then, in the interim, stop the housing industry.
Cardone urges Powell to “step back” to kick-start the housing market.
“Pricing will need to drop if interest rates are to fall. It’s the opposite of what people believe. When interest rates drop, mortgage applications are likely to increase and people may start selling their houses,” Cardone said to co-host Rachel Campos Duffy.
Renters are also feeling the same economic pain as first-time home buyers who have had their dreams dashed by high prices.
Moody’s Analytics reported that the U.S. Rent-to-Income Ratio (RTI), which is the standard for rent burden, decreased by 0.5% in Q3. Renters who pay 30% or more in rent are considered to be “burdened”.
Cardone stated, “Mortgage applications were at an all-time low.” “The Fed will create more renters than in the past 50 years in this country,” Cardone added.
