Ever wondered about the changing dynamics of the real estate market? This episode offers an in-depth look at the surge in new-build homes, accounting for a third of the market, and how it's reshaping the landscape for homebuyers. We delve into the effects of high rates on existing inventory and how it's pushing buyers towards newly built single-family homes. Additionally, we unpack an alarming trend - the growing struggle of teachers to find affordable housing within commuting distance of their schools. This issue, while concerning, also presents a unique opportunity for insightful investors to provide much-needed affordable housing solutions in strategic locales.
In the second segment of our discussion, we turn our attention to the latest inflation rate update and President Biden's groundbreaking clean energy push. Billions in government funding have been unlocked for green projects, opening the floodgates for entrepreneurs to capitalize on this venture. From EV batteries to solar and wind energy equipment, and energy storage technology - the potential is immense. This episode is a trove of information not only for real estate investors but for anyone interested in making informed business decisions that positively impact society. So, are you ready to explore these market trends and the extensive opportunities they offer?
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Here's what's currently happening in the world of real estate and this week's weekly real estate market update. New builds make up one third of houses on the market. With high rates locking up existing inventory, home buyers are turning to newly built single family homes. As overall inventory sits at an all time low. Newly built homes made up nearly one third 31.4% of US single family houses in the market in the second quarter. That's the highest share of any second quarter on record, with new construction keeping the housing market afloat amid the severe shortage of existing homes for sale. The portion of new homes of all inventories is up from 30.3% a year earlier and nearly double the pre-pandemic share of about 17% in the second quarter of 2019. The second quarter share is down from a record high of 33.6% from the previous quarter, but that's the normal seasonal pattern, as the share of new homes tend to peak in the winter months. Next up, the typical teacher can afford just 12% of homes for sale near their school, down from 30% in 2019. This is bananas. According to Redfin's analysis, the average teacher can afford just 12% of homes for sale within commuting distance of their school, down from 17% last summer and 30% in 2019. Before the pandemic home buying boom drove up housing prices. Commuting distance means a teacher can drive between home and work within 20 minutes during the rush hour. To calculate the share School by metro, we average these shares affordable to each school within a metro. According to Redfin, the average teacher can afford just one quarter 27% of available renters within commuting distance of schools. Teachers are struggling to find affordable housing near their workplace, in large part because of their wages are in keeping pace with inflation. So two things here I take away. I feel for teachers. Teachers should be paid well because they're the ones educating the future of our country. This is rough for teachers. Second part here is as investors. I see opportunities. If you're an investor and you're looking for opportunities and areas to invest in this type of information, this type of data allows you as an investor, as a thinking person, to think hey, maybe investing in buying multifamily properties near 20 minutes of commuting distance to a school is a good idea. If I can provide affordable, safe, clean housing, that can be a niche for you buying those type of properties to provide housing for school teachers based on this data. I like to make business decisions based on data. This is great information to make a good decision to help and provide a service for people that are impacting the future of our country and the future of our country. Lastly, this week's inflation rate update is courtesy of the morning brew. President Biden's historic clean energy push graduated from infancy into toddler. Today it's been exactly a year since the inflation reduction act became law. All I get inflation taming names suggest the IRA is primarily about pouring an unprecedented amount of federal cash into speeding up cleaning clean tech adoption. The landmark legislation unlocks 394 billion of government funding and 367 billion in loans for environmental projects, including pay attention here Subsidies for companies that produce EV batteries, solar and wind energy equipment, as well as energy storage technology. Up to $7,500 in tax rebates for drivers willing to ditch their gas guzzling guzzlers for an EV Yikes, I drive a big pickup truck. It's for homeowners who boost the energy efficiency of their homes and for businesses and nonprofits that do the same with their spaces. Other measures aim to offset a government budget shortfall by lowering the prices Medicare Pays for prescription drugs and tightening corporate tax rules. So, as I read this bill and you got the information, there is nearly $800 billion set out. On this and this initiative, I see opportunity. If you're an entrepreneur and you're looking for opportunities, maybe spending some think time and thinking how you can create value around companies that produce EV batteries, solar and wind energy equipment, as well as storage for technology, creating a company that does that. There is a lot of opportunities here if you can get creative and figure out how to produce these things. There is almost $800 billion available for you to grab if you're smart and you can think on how to create the opportunities for yourself and create a business around this. And that has been your weekly Real Estate Market Update. I'll see you guys next week. Peace.