Property
Published on December 16, 2023
Updated December 16, 2023, 4:08 p.m. ET
A real estate investor is witnessing the start of the industry's “biggest” correction he has ever seen.
“I just want to say we're facing the biggest real estate correction of my lifetime,” private equity fund manager Grant Cardone told “FOX & Friends” on Thursday while discussing the state of the industry.
“It is [real estate correction] It will be a great opportunity for individuals, everyday people, to actually secure trophy properties from institutions. This has never happened in the country,” Cardone said.
“It will reach an epic level,” he said.
Despite Cardone's assertion that the industry is in uncharted territory, the current real estate market poses significant problems for any buyer or seller as interest rates and housing costs remain high.
As sellers stay away from the market, low inventory exacerbates the problem and causes property prices to rise.
“Today, it is unaffordable for people to own a home,” Cardone stressed, while accusing the Federal Reserve of “single-handedly” destroying the real estate market by raising interest rates.
“He [Fed Chairman Jerome Powell] did not control inflation. He failed miserably. “What he actually did was create the housing industry and now stop it,” the real estate investor said.
A real estate investor is witnessing the start of the industry's “biggest” correction he has ever seen. Getty Images “I just want to say we're facing the biggest real estate correction of my life,” private equity fund manager Grant Cardone told “FOX & Friends.” FOX NEWS
To stimulate the housing industry, Cardone calls on Powell to “stand back” and let the market correct itself.
“To bring prices down, interest rates have to come down. This is actually a contradiction to what most people think. But if interest rates go down, mortgage applications will go up and people will start selling their homes,” Cardone told co-host Rachel Campos-Duffy.
As first-time buyers' dreams of owning a home have been dashed by high costs, those renting are experiencing similar economic struggles.
The current real estate market poses major problems for any buyer or seller as interest rates and housing costs remain high. Christopher Sadowski To boost the real estate industry, Cardone is urging Federal Reserve Chairman Jerome Powell (pictured) to “step back” and let the market correct itself. Xinhua/Shutterstock
Moody's Analytics found that the U.S. rental-to-income ratio (RTI) fell slightly by 0.5% in the third quarter, ending at 30% – a level that represents the threshold for rent burden.
Tenants are considered “burdened” if their rent payments are 30% or more of their gross (or pre-tax) income.
““The Fed will attract more renters in this country in the next two years than in the last 50 years because mortgage applications are at historic lows,” Cardone said.
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