When Will the Next Housing Crash Happen?
If you’ve paid any attention to real estate in the past couple of years, then you’ve seen a lot of disruption in supply, demand, and pricing—as well as a lot of speculation about if (and when) another crash might occur.
The 2008 housing market crash had an echo effect throughout the American economy, with a lot of its impact still being felt today. Some of those impacts are good, including more transparency for buyers in the lending process and higher qualification requirements for optimal rates. However, we’ve also seen a stark decrease in access to home ownership, with many people wondering if another crash is in the cards.
So, is another housing marketing crash likely? Here’s what to know about housing crashes in the U.S., including why the next one might be further off than you think.
History of U.S. housing crashes
The housing market is inherently cyclical, and ebbs and flows are a natural part of that cycle. Throughout the years and decades we’ve seen a lot of predictable patterns as the market slows down, speeds up, and then slows down again. That being said, massive crashes on the scale of what happened in 2008 are quite rare, and most of the time the market bounces back from a downward swing without serious hardship.
There have been five major housing crashes in the United States, each of them preceded by a major historical event:
– A housing crash followed The Great Panic, a period of financial turmoil when banks suspended payments and loans in response to larger economic declines in the country.
– Falling stock prices once again tanked the housing market, which was eventually revived by lowering interest rates—a trend that lasted in some form until about the early 1900s.
– The crash of Wall Street and the start of the Great Depression. Property values dropped significantly and banks greatly limited their lending practices, recovering only in the boom that happened after the second World War.
– Another massive hit to the stock market and another subsequent housing crash. This crash was also preceded by record inflation, which sent home prices soaring and priced a lot of families out of the market.
– Predatory lending practices resulted in people buying homes they couldn’t afford and eventually led to a bubble when many homeowners couldn’t make their loan payments. This started a nationwide recession that was in many ways equal in scope to the Great Depression.
This quick look back at housing crashes of the past is actually a reassurance of our ability to adapt to economic changes without widespread market destruction. And while there’s no denying the seriousness of the crashes that did occur, they’re surprisingly few and far between when considering how many ups and downs the U.S. economy—and the U.S. real estate market—has taken over the years.
Is another housing crash likely?
There’s no doubt that we’re in a unique economic period right now, but whether that will lead to a housing crash is very much up for debate.
Record low interest rates and regulatory abolishment of the lending practices that were partially responsible for what happened in 2008 mean that we’re in a much better place than we were in decades’ past. Also, many people have fled the cities due to covid-19 and the ability to work from home. They, along with many retirees, continue to buy land and houses in smaller cities or rural areas. Whether a housing crash is on the horizon isn’t clear yet, and a housing boom could be just as likely.
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Whether you like it or not, we’re living in a digital world, and while the concept of Artificial Intelligence (AI) may seem like something only major tech companies use or a concept from Sci-Fi movies, the truth is many of us are already using AI in our everyday lives.
So it makes sense that AI would now be making itself present in the real estate market. Our society has an ever-evolving toolbox of digital resources, and the real estate market is no exception. Curious what AI really is and how you may see it in the real estate arena? We’ll break it down here.
What exactly is AI?
With time and advancements in technology, the concept of AI itself has evolved. However, at its core, artificial intelligence is simply “a field, which combines computer science and robust datasets, to enable problem-solving,” as described by technology giant IBM.
Many people don’t even realize that most of us are using AI in our everyday lives. Things like unlocking your phone with Face ID, using a digital voice assistant, performing a Google search, watching Netflix, or even sending an email are all actions that utilize AI. Now that you have a better idea of what AI is— how has it entered real estate?
AI and real estate
AI is a technology that can make logical conclusions on its own, and through sophisticated algorithms, analytics, and robust data sets, it can make educated guesses about future behavior. Here are five ways that artificial intelligence is already being utilized in real estate and where you can expect to see more influence:
Agents use AI to qualify leads:
Browsing through multimillion-dollar homes on Zillow that we could never purchase is a favorite pastime of many, but AI allows agents to sift through leads and connect with real potential buyers.
The advanced analytical tools from AI can be helpful in automating work throughout the design stages to ensure a property is as sustainable as possible, meets design requirements, create better security systems, and even predict the property market.
Makes for easier transactions:
Realtors are utilizing CRM systems that use machine learning to auto-fill data and generate reports which can reduce the number of errors and cut down on time in closing deals.
Improve the home search process:
Consumers can more accurately search for homes that fit their needs and requirements by using filters that organize properties by locations, square footage, price, number of bedrooms, etc. However, AI takes it a step further by analyzing your search patterns and offering more accurate results that are more likely to fit your needs.
Impact lending and mortgages:
At its core, underwriting is all about data, and the use of AI technology in this process has sped up the process and reduced the potential for human error. Additionally, AI can detect any errors early on, which can save both parties time from lengthy corrections later on in the purchasing process.
AI in the real estate sector is making processes easier for sellers, investors, and agents alike. Whether you realize it or not, you’ve likely already been using many AI functions. Have you utilized AI in your land buying or selling experiences?
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If you’re looking for a place that has it all, you may be surprised to learn that Rhode Island may be the spot you’re after. Beaches, all four seasons, tons of outdoor activities, and big-city art and cultural things to do—the Ocean state has a little bit of everything for everyone.
Rhode Island is best known for its sandy shores and Colonial seaside towns, but there’s plenty more to consider even if you’re not in the market for waterfront property.
So, what exactly can the smallest U.S. state offer? Plenty! From great weather to historical and cultural events, you may be surprised at what living in Rhode Island could look like.
Reasons to Move Rhode Island to the Top of Your List
An affordable East Coast option:
Want to settle down on the East coast? Rhode Island may be your best bet! Thanks to expanding employment opportunities and the look and feel of other East Coast cities like Boston or New Haven without the hefty cost of living, Rhode Island’s capital Providence is one of the most affordable places to live in the region.
Many uses for the land:
You may think there aren’t many options, with it being such a small state, but while small, Rhode Island has it all. Great hunting opportunities like whitetail deer, water-fowl, small game, and an impressive trout stocking program for freshwater fishing. Diverse farming prospects such as greenhouse and nursery products, dairy products, sweet corn, aquaculture (seafood), and apples are among the most common. Not to mention the 400 miles of coastline make it the perfect place for those who love being on the water. A surprising fact – homesteading has also become more popular in this tiny state over the last few years.
A paradise for the history lover:
Rhode Island was one of the Thirteen Colonies meaning when you land in Newport, you have over 400 years’ worth of history to check out! In addition to Rhode Island’s colonial past, in recent years, the state government has made it a priority to uplift and acknowledge the rich Native American history of the people who first inhabited the land.
Always something to do:
So many love Rhode Island because they get the slower pace of life outside of the big city without feeling like they’re totally isolated or living too far from the action. Rhode Island, and particularly Providence, constantly has festivals and events going on. Between the outdoor activities and social occasions, you’re unlikely to get bored.
Because the state itself is so small, you can get practically anywhere in no time! Driving between the furthest points of the state (Woonsocket to Westerly) is only an hour. Additionally, public transportation (intercity buses) is low-cost.
After reading through those facts, what do you think? Will you be looking for land in Rhode Island any time soon? Check out Land Hub’s current listings to see what properties are available and if you’re considering selling your own Rhode Island land, then be sure to use this article to help promote your property!
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By Caroline Kirby
While we’re just about to enter the winter season, it’s not such a bad idea to start preparing your farm for potential spring floods. In the last few years, farms across the U.S. have seen a spike in extreme weather and have suffered the aftermath of floods.
Tropical storms slammed the east coast, and summer rains flooded the Midwest – no matter where you live and farm, some of these tips could save you a lot of time and money.
Steps to take to minimize damage and risk from flooding
For many farms, flooding is inevitable, but there are a few things you can do that will minimize damage and downtime on your farm in the event of a flood.
Buy yourself some time and lower the potential damage with these steps.
• Take inventory: Create a photo catalog of all the things on your farm and where they’re located. This can be helpful for insurance claims after extreme weather. If you have livestock, then mark your animals so they can be easily returned if lost.
• Digitize documents: You should be storing all of your important documents (such as deeds and insurance paperwork) in a safe, dry place. However, getting digital copies can also be helpful in the case of major weather events.
• Double-check insurance: This is a great step to take before the threat of bad weather is even on the horizon. Double-check if you have flood insurance and get clear on what your current policy entails.
• Do regular checks on equipment: Throughout the year, you should perform checks on your generators to ensure they are working, secure any propane tanks, and make sure machinery and vital equipment are in a safe place.
• Discuss evacuation plans: Have a clear plan in place for extreme weather emergencies and communicate that with your employees, family, and anyone else who may be on the farm. Consider posting copies of important directions or escape routes around the property. If you have animals and livestock on the property, then you should also consider an evacuation plan for them ahead of time.
• Emergency contact info readily available: Make sure to have a list of emergency contacts in a known place so that it’s easily found.
• Identify safe spots: Look around for higher fields that may be a good place to take livestock during a flood, and be sure to ask for permission to use the field if it’s not your own.
As you can see, there are tons of different steps that you can take in advance that may have a significant impact on protecting your property during a flood. There are a few other things to keep in mind that can reduce the likelihood of flooding on your farm in the first place, like:
• Creating runoff ponds or sediment traps
• Avoid directing runoff towards roads and watercourses
• Discharge roof water into dry wells around the farm
• Loosen soil to create a rough surface after harvesting so that more water may soak in
What are your best tips to help prevent flooding on your farm? Browse through Land Hub’s blog for more farming resources.
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By Caroline Kirby
Beekeeping and leasing land to beekeepers is the growing trend for many vacant landowners and farmers. Whether you’re looking to pollinate your crops or you just have a piece of land that you’re not using, leasing to beekeepers may be a productive and sustainable option that even has some tax benefits to boot.
How does leasing land to beekeepers work?
In the last decade, beekeeping has qualified as an Agricultural Exemption that can save landowners a lot of money in property taxes. The great thing about qualifying for this special valuation is you don’t even have to be the one doing the work – you just need to lease your land to a beekeeper or a commercial beekeeping operation if you have the space.
There are many websites and online forums where you can match with beekeeping operations in your area. So, why do it?
Why should I lease my land to beekeepers?
Bees are a vital part of the environment and food supply chain in North America and across the globe, as they pollinate our crops.
Over the years, commercial bee colonies have collapsed at an alarming rate due to a phenomenon known as Colony Collapse Disorder (CCD), which has been linked to the use of pesticides on crops. Beekeepers need healthy forage land to be able to rebuild colonies after crop pollination.
When you lease your land for beekeeping, you’re helping beekeepers grow their business, making your land productive, helping farmers pollinate crops, and even contributing to supporting our global ecosystem.
What do beekeepers need on their leased land?
The most important thing beekeepers need to do their job is space. While bees can be found in urban, suburban, and rural areas, there are some specific types of land which are more suitable for bees and beekeeping than others.
Factors that may influence the productivity of land for beekeeping includes:
• Forage: Bees need diverse and abundant food sources. You’ll want an area with plenty of flowers in bloom.
• Water: : Your land should have a proper water source nearby so that the bees don’t spend too much energy flying far. Bees love small ponds or creeks but are notorious for being drawn to “dirty” water sources like hot tubs or swimming pools.
• Climate: While American honeybees have done well in adapting to their climate, the weather in your area will impact when flowers and plants bloom and if these tiny creatures can survive winter.
• Nearby beekeeping: Honeybees are known to rob other colonies, which can devastate and deplete resources as well as spread disease. Do some research to ensure that any neighboring colonies are adequately spaced out.
Each of these factors can impact how the bees live and produce. Open meadowland near wetland is the ideal location for beekeeping, while an area surrounded by forests and trees isn’t as effective and can hinder honey production and the ability to pollinate.
North Dakota, Montana, and California are the top three honey-producing states and are often associated with more productive beekeeping. Browse through Land Hub’s current listings to purchase property for beekeeping in one of these states, or put your own land up for sale!
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by Caroline Kirby
Waterfront property is a dream for many, but it’s not as straightforward a process as purchasing other types of property; in fact, there are some special considerations that many first-time buyers have never even considered.
If you’re looking for the perfect lakefront property to purchase before summer starts, you’ll want to keep a few things in mind. Lakefront property is a great investment most of the time, and having access to endless fun activities is great, but not all that glitters is gold. Here’s a quick look at the special considerations of purchasing a lakefront property.
Things to keep in mind when looking for lakefront property
Waterfront property is a dream for many, and while the price tag itself is enough to scare many away, there are plenty of other variables that can complicate this type of transaction. Don’t make these mistakes when looking for your first waterfront property!
• Consider all the fun stuff in your budgeting: A lakehouse is a lot of fun, but a majority of the activities won’t come cheap. Boating, water skiing, tubing, and all the safety equipment are separate costs that many buyers don’t consider when looking for a lakefront property. Look at the different gear costs and if that works for your budget.
• Ensure the house is built to stand up to the waterfront: Homes on the water take on much more abuse than a regular home. Extra moisture, flooding, etc., can all take a toll on these properties. Keep an eye out for homes that have features like storm shutters and taller foundations that will protect these properties from the weather. Plus, all of the amenities and hobby items will also have wear-and-tear expenses.
• Don’t forget about flood insurance: Depending on where you live, you likely haven’t considered flood insurance when purchasing regular properties. This can be expensive! Get a quote from a qualified insurance provider before making any offers on lakefront property. Additionally, there are real estate agents that specialize in waterfront property who can help put you in touch with the right insurers.
• The land may be leased: It’s pretty common that houses on the water come with a lease. Federal entities like the U.S. Army Corp of Engineers or even power companies often own the property on or around the lake, and they may lease the shoreline where lake houses are built. Buying property in these areas may mean that you’ll inherit a lease of the land.
• Start looking for loans early on: Because waterfront properties are so expensive, you’ll want to start the loan process sooner rather than later. Waterfront home loans are much more different than normal home loans.
• Consider the location: You may think you’ll just be happy to have a house on the water but think about the orientation of the home and what you want. Will you get morning or afternoon sun? Does the deck have sun protection? Does the wind coming off of the lake affect your level of enjoyment? These don’t have to be factors that make or break a purchase, but they are worth considering before making any offers.
There’s a lot to consider when buying any property, but it’s important to recognize the uniqueness of lakefront properties. Take a look at Land Hub’s current lakefront listings to see what properties are out there today!
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