Treating homes like ATMs is back in fashion: Home Equity Withdrawals rising at fastest pace since Great Recession.
ByI love getting tips from Uber drivers especially when it comes to buying real estate. We are now back at that level where real estate can do no wrong, the house humpers are confusing luck with investment acumen, and of course the sheep dive in head first at the most frothy time. It is clear that we are in a mania and hot money is flowing everywhere. Credit card offers are soaring and lending is booming across all areas: credit cards, auto loans, student debt, and housing. With housing, we are now seeing one of our favorite past-time events in treating a home like an ATM. Home equity withdrawals are now moving up in a direction that is not exactly positive if you believe in actually keeping your equity locked in instead of cementing your belief in the bubble and adding more debt. You do need to pay those loans back by the way which many tend to forget. Home equity withdrawals are simply one of the final steps in the delusional mania.
The housing ATM is back
Real estate is blistering hot. It is fully disconnected from incomes or any sane measure of valuation. The only thing beer belly house lusters can say is that “well comps are selling for this so therefore the market has spoken!” Cult chasers were also buying tulip bulbs, beanie babies, and itching to get a piece of Bernie Madoff’s investment sauce. Now the hot thing of the day is buying a crap shack at all costeven if it means you are living on rice and beans to pay the mortgage…
