recent post by Charles totally nails the nature of this new housing bubble.
The world is utterly awash in capital, restlessly in search of a return. Whenever something new shows the promise of safe, profitable returns, a shortage of that something soon follows.
During Housing Bubble 1.0 (2004-2008), that something was not actually housing, it was borrowers. As the global capital supply flooded into the mortgage industry, new borrowers were deployed en masse, a hopeful corps of the financially insecure, then students and retirees, then bums, and finally just figments of bankers' imaginations, mere ink on pages with just enough life breathed into them that a loan could issue.
This new Housing Bubble 2.0 is different. This time, the global capital supply is bypassing mortgages, and looking straight to the properties themselves for those great returns.
Pity the yuppie who buys into this bubble. When this bubble finally exhausts the supply of affluent homebuyers, it too will burst, and it's the techies, who just happen to be the last holdout group of Americans who can still (barely) afford to buy homes in cities with jobs, who will be bankrupted when the bubble finally bursts.