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A Repeat of the Real Estate Bubble?

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Real Estate Agent with COMPASS DRE# 01339266

Will history repeat itself again?

Will the world experience another "Real Estate Bubble"?

The Wall Street Journal has published an interesting article that raises the question about how much international real estate developers learned from the real estate bubble that burst just a few short years ago.

This week Hong Kong's biggest developer (Sun Hung Kai Properties) agreed to pay $434 Million for a 130,000 sq ft site in the suburbs of Hong Kong.

This price represented a 20% premium above the consensus price of six analysts  and 69% above the reserve price of $268 Million.

Apparently "easy credit and ample liquidity" is raising concerns of unrealistic price increases.

In an attempt to cool down excessive lending, the People's Bank of China (The Central Bank) is requiring that banks increase their cash reserves.

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Dagny Eason
Dagny's Real Estate - Wilton, CT
Fairfield County CT, CDPE Homes For Sale and Condo

I think we are in for another huge pop.....    Thanks for pointing out that great article!

Feb 24, 2010 08:29 AM
Ruthmarie Hicks
Keller Williams NY Realty - 120 Bloomingdale Road #101, White Plains NY 10605 - White Plains, NY

Great article - what goes up - must eventually come down.  But what goes down - eventually rises again from the ashes.

Feb 24, 2010 08:32 AM
Team Honeycutt
Allen Tate - Concord, NC

Yes! I hope we can get back to the full bubble and not the popped bubble that we are in right now!

Feb 24, 2010 08:33 AM
Ellen Crawford
Maximum One Executive REALTORS® - Alpharetta, GA
Alpharetta Real Estate Agents & Alpharetta REALTOR

Yes, I think there is another bubble just around the corner in luxury properties, and commercial real estate that will dwarf the sub-prime kiddie party we are having now.  In a few countries real estate is still climbing, and what happens there will be interesting to see.

Feb 24, 2010 08:44 AM
COMPASS PALM SPRINGS | Stewart Penn
COMPASS - Palm Springs, CA
COMPASS Palm Springs - Broker Associate

When Hong Kong's biggest developer commits to such a purchase one can't help wondering how they arrived at their decision to make such a deal.

Feb 24, 2010 09:02 AM
Bob Willis
Berkshire Hathaway HomeServices California Properties - Orange, CA
Orange County & L.A. County Real Estate Agent

There is little doubt that international events will have some type of effect on the U.S. economy and real estate market.  I suspect we are in for a bouncy ride in, around or on that bubble.

Feb 24, 2010 12:28 PM
Steve Shatsky
Dallas, TX

Hi Stewart... it sounds as if the Chinese government is starting to take notice.  Let's hope they can head it off!

Feb 24, 2010 01:32 PM
Terry Chenier
Homelife Glenayre Realty - Mission, BC

Stewart,

I revently did a post on real estate bubbles. The indicators are there for Canada.

Feb 25, 2010 02:16 AM
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COMPASS PALM SPRINGS | Stewart Penn

COMPASS Palm Springs - Broker Associate
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