Tags: America's Forum | real estate | market | bubble | housing

Real Estate Expert McCabe: Bubbles Growing in Calif., Fla.

Friday, 18 Apr 2014 04:11 PM

By Aaron Stern

A Gallup poll shows Americans have renewed faith in the investment potential of real estate but the housing market could be headed for another bubble burst, says Jack McCabe.

"I personally believe that, yes, there is danger of a bubble. Not a national bubble at this point, but definitely those sand states, the southern states where we saw the greatest rise in artificial appreciation and then the rocket came crashing back to Earth," the real estate expert told John Bachman and J.D. Hayworth on "America's Forum" on Newsmax TV.

Southern California and Florida, in particular, could be in line for hard times ahead.

"California definitely is getting into that bubble territory now with the gains they've seen out there," McCabe said. "Florida, you can make a case where we've seen 21 to 28 percent increases in real estate values here in the last year may be approaching that sometime soon."

Story continues below video.

A longstanding rule of thumb has been that two-thirds of Americans owned homes, while one-third rented, McCabe said. Those proportions have shifted since the subprime mortgage crisis and economic crisis, with fewer Americans building up personal nest eggs by owning homes that appreciate in value over the course of five, 10 and 20 years of ownership, he said.

Older, more affluent Americans are more likely to view real estate as a good investment than younger generations who value mobility and don't have as much personal wealth built up yet, McCabe said.

McCabe agrees with the growing perception that real estate is a good investment, but said it should be part of a broad investment portfolio, not the only place Americans hope to gain wealth from.

"Real estate should definitely be a part of your investment portfolio, but you shouldn't put all your money into just real estate because if we have a down-turn, prices drop 30 to 50 percent and you can't unload your assets, you're in a world of hurt," he said. "Right now, it makes great sense to have real estate in your portfolio, it might even be real estate heavy right now with the returns that we're seeing from different investment classes."

Related Stories:

© 2015 Newsmax. All rights reserved.

Around the Web
Join the Newsmax Community
Please review Community Guidelines before posting a comment.
>> Register to share your comments with the community.
>> Login if you are already a member.
blog comments powered by Disqus
Zip Code:
Privacy: We never share your email.
Hot Topics
Follow Newsmax
Like us
on Facebook
Follow us
on Twitter
Add us
on Google Plus
Around the Web
Top Stories
You May Also Like

Rep. Peter King: I Can't Figure Out Why Mitt Ripped Jeb

Friday, 30 Jan 2015 14:06 PM

Mitt Romney very definitely appeared to throw a cheap jab at Jeb Bush as he announced Friday that he would not seek the  . . .

Dem, Conservative Agree: Mitt Romney Exit Boosts Jeb Bush

Friday, 30 Jan 2015 13:32 PM

Jeb Bush is the unofficial Republican front-runner for the party's 2016 presidential nomination now that Mitt Romney has . . .

Michael Reagan Pleased Romney Letting Jeb Bush Run in 2016

Friday, 30 Jan 2015 12:26 PM

Political commentator and former first son Michael Reagan told Newsmax TV that if Hillary Clinton "can't be beat by Repu . . .

Most Commented

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

America's News Page
©  Newsmax Media, Inc.
All Rights Reserved