When a Nobel Laureate in economics says that the housing market has been overheated since 2012, people listen.
“The market has been looking overheated ever since 2012 when we saw the upsurge that has been going on now for almost six years. And it looks like it’s still going up,” he said in an interview with Yahoo Finance.
What is Robert Shiller talking about? Home price growth in the US has been exceeding wage growth … since 2012.
As Urban Institute’s Laurie Goodman noted at an American Action Forum debate with me, the mortgage credit market is different today than in 2005. But as I responded, it terms of the ratio of home price growth to average hourly earnings growth, it looks quite similar to 2001-2005.
But Shiller adds, don’t panic.