Why Barbara Corcoran’s Still Bullish on US Real Estate

Corcoran and Cisneros's Housing Talk Merits a Closer Look

(Continued from Prior Part)

The US economy’s health

In a January 10 interview with Wall Street Week, Shark Tank’s Barbara Corcoran and former Housing and Urban Development Secretary Henry Cisneros shared their views on the US economy and real estate sector (IYR) (VNQ).

Corcoran likes to judge the health of the US economy (IWM) (VOO) (DIA) and the real estate market by counting the number of cranes on the skyline—which shows that more inventories are being built. If she started seeing more, she’d increase her ad spending budgets.

For the time being, Corcoran remains bullish on the US economy and real estate market. Statistics seem to support this view. She cites inventory being down 10% year-over-year as a fact that should support home price appreciation and the growth of her business. Lower inventories help real estate prices. Prices are already up 6%. Demand exceeding supply bodes well for prices.

The Fed has helped markets recover

Moreover, the Fed has been playing its part well to assist the recovery in the housing sector by keeping interest rates low for a while. The federal funds rate had been zero-bound for seven years. “Interest rates are still cheap,” Corcoran said, explaining that the housing market should see a rosier tomorrow.

Henry Cisneros looks at the crowd at sporting events for important cues. Where the crowd is diverse, you can see that the city’s economy is working fine since you’re not seeing just the elite in the stands.

Cisneros is bullish about the future of the United States. But he shared some lingering concerns about the economy. “Keeping the economy strong enough, having an economy that employs people” are worries for Cisneros. Climate change is a real problem. Given the hope that the United States will keep its technology and higher education strong, it’s the “place to be in the world,” he said.

Our series What Are the Top Stocks and Sectors at the Beginning of 2016? may interest you.

Browse this series on Market Realist:

• Part 1 - Corcoran and Cisneros’s Housing Market Talk Merits a Closer Look

• Part 2 - Why Barbara Corcoran Credits Donald Trump for Changing Manhattan

• Part 3 - Despite a Tough Time, Homeownership Remains the American Dream