Soaring home prices, lack of inventory and bidding wars in parts of the country are prompting some analysts and investors to start using the B-word again: bubble.
Fears that prices are rising too far, too fast have led to predictions that the market won't be sustainable. "Prices in some areas are just out of control," Scott Tamkin with Keller Williams Realty in Los Angeles told CNBC. "As soon as a good property comes on the market at a reasonable price, bam! It's gone in multiple offers, oftentimes in cash," he said.
Rick Sharga, executive vice president at Carrington Mortgage Holdings in Santa Ana, Calif., reported similar experiences in a previous interview. In parts of California, he estimates, 70 percent of the homes sold have multiple bids.
In markets such as Phoenix, Las Vegas, Los Angeles and parts of Florida, where prices plummeted during the housing bust, a lack of inventory and high investor activity has driven up home prices as buyers compete for the few properties on the market.
Meanwhile, the party appears to be ending for housing stocks, hampered by expectations of rising mortgage interest rates. In June, the index that measures housing stocks marked the largest drop in a year. The major building companies, including DR Horton, Pulte, Lennar, and Ryland, all saw losses after performing well over the past year.
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