It’s the brave new world of real estate by robot. A new crop of companies is introducing technology they say will reshape how property is rented and sold. By using robots to do some of the tasks that people normally handle—such as showing properties, creating floor plans and shooting video of homes—these firms hope to
In 2000 we had an internet bubble. In 2007 we had a real estate bubble. What might be the next bubble?
The next bubble will be due to cheap money… meaning that there may be multiple industries that are currently in bubble territory.
Ever since the Fed (and other money printing entities throughout the world) started to print money at record pace after the 2008 crisis, there has been a lot more money in the economy (duh!).
What the central banks were trying to do (and it has worked a little) was stimulate economies by injecting money into industries that were hanging on by a thread.
Unfortunately, this has caused many assets to be inflated in price because of the larger volume of dollars (or whatever currency you use) in the market. Notice I said volume of dollars, not value of dollars.
This large volume of money allowed people to pay higher prices for things like homes, businesses, cars, education, or really anything that can be bought with borrowed money.
As we continue down this road of more money printing, we are just like a drunk at the bar, who is drinking more and more. We think we are getting better and better at dancing all over the tables, and hey, maybe we are! But… the next morning we are going to have a mean hangover.
So, anything that is financed through borrowed money is at risk of being in a bubble. Real assets that cannot be financed are the few things that wealthy people will start transitioning into as this bubble gets larger. Things like metals, art, collectibles or foreign real estate.