Another article showing concern in the housing market- yet the author may have lacked critical thinking

[Rmay635703]

For some reason people think this housing correction will happen much quicker than last time, as if 2006 - 2012 was the stone age and the internet didn't exist or something. I'm inclined to think it's going to take years. People forget that the housing market is sticky as in people asking prices as if rates are still 3% when rates are 7%.

I’m inclined to believe the full crash will take years but short term there will be drops that historically would be considered a “crash” but due to volitility will get explained away as not a crash and just a bump or a dip.
These mini crashes will occur as different forms of investor and home owner have to exit or move.

Should have a graph looking like a roller coaster when we are done.

 

[zzyzzx]

 

[Vil_Riker]

The only shift we will see when the layoffs happen and people start losing their homes. But we have large institutional buyers ready to snap these properties.

 

[PimTac]

Interesting article and comments here.

Mortgage Bankers Predict Mortgage Rates to Drop to 5.4% by End of 2023. A Year Ago, They Forecast 4% by Now, but Now We’re at 7%. Wishful Thinking by Crushed Mortgage Lenders?​

Mortgage Bankers Predict Mortgage Rates to Drop to 5.4% by End of 2023. A Year Ago, They Forecast 4% by Now, but Now We’re at 7%. Wishful Thinking by Crushed Mortgage Lenders?

This raging inflation will keep dishing up a lot more surprises.

wolfstreet.com

 

[zzyzzx]

Married With Children TV show reference:

 

[Hillbilly Deluxe]

“There’s a housing demand”


“People can’t afford a house at 7-1/2%”

“Builders can’t afford to build houses people can afford”



Ok….. how does this get solved without something worse than 2009-2013?


(I know how, but the discussion isn’t allowed here and many under 50 crowd don’t like it)

 

[PimTac]

“There’s a housing demand”


“People can’t afford a house at 7-1/2%”

“Builders can’t afford to build houses people can afford”



Ok….. how does this get solved without something worse than 2009-2013?


(I know how, but the discussion isn’t allowed here and many under 50 crowd don’t like it)

It won’t be solved overnight but her is one idea I have mentioned before;

Build smaller homes. Many of us that are older grew up in houses that were 1000sf or less. Every child does not need their own bedroom. Smaller homes are cheaper to heat and cool as well as maintain. Obviously easier to build.

In my case I was in a family of six. Our house was around 900sf. We did fine. The one bathroom was the obvious choke point.

 

[tbm5690]

It won’t be solved overnight but her is one idea I have mentioned before;

Build smaller homes. Many of us that are older grew up in houses that were 1000sf or less. Every child does not need their own bedroom. Smaller homes are cheaper to heat and cool as well as maintain. Obviously easier to build.

In my case I was in a family of six. Our house was around 900sf. We did fine. The one bathroom was the obvious choke point.

I agree to a point, but climate also dictates the ability to downsize IMO. Living here 5 months out of the year you basically don't go outside...the family of 6 here living in a space that small would emerge in the spring a family of 3. Warmer climates where outdoor living can be mazimized? Sure.

 

[Rmay635703]

But we have large institutional buyers ready to snap these properties.

That is identical to the 2008 issue, while many large investors loose their hat other investors step in to also loose their hat

Many retirement and trust funds went bankrupt then got a bailout

It won’t be solved overnight but her is one idea I have mentioned before;

Build smaller homes. Many of us that are older grew up in houses that were 1000sf or less. Every child does not need their own bedroom. Smaller homes are cheaper to heat and cool as well as maintain. Obviously easier to build.

In my case I was in a family of six. Our house was around 900sf. We did fine. The one bathroom was the obvious choke point.

too bad small homes are usually illegal to build in most areas and when they are made are an overpriced gimmick that costs more than a typical full size house.

Ah well

 

[joekingcorvette]

Lots of houses are sold as VRBO's for weekly or daily rentals. With the internet at everyone's fingertips it's very easy to rent a place for a week or a weekend. I have friends that buy out of state and rent out the units and make money. It's work but it pays off. This increases the price of other homes.

 

[zzyzzx]

Lots of houses are sold as VRBO's for weekly or daily rentals. With the internet at everyone's fingertips it's very easy to rent a place for a week or a weekend. I have friends that buy out of state and rent out the units and make money. It's work but it pays off. This increases the price of other homes.

The problem is the people renting AirBnb and vbro and ruining neighborhoods in the process. I'd ban those.

 

[joekingcorvette]

The problem is the people renting AirBnb and vbro and ruining neighborhoods in the process. I'd ban those.

I totally agree. I fish on the Missouri River and one of the small towns has a ban on buying a home for VRBO or AirBnb type of rentals.

 

[zzyzzx]

 

[SC Maintenance]

Case Shiller home sales prices just reported - down -0.7%. -0.3% was expected.

Note this is for homes closing in August, so likely agreed on price in July, and locked mortgage rates in July at less than 5%. So this is essentially 3 month old data.

 

[4WD]

It won’t be solved overnight but her is one idea I have mentioned before;

Build smaller homes. Many of us that are older grew up in houses that were 1000sf or less. Every child does not need their own bedroom. Smaller homes are cheaper to heat and cool as well as maintain. Obviously easier to build.

In my case I was in a family of six. Our house was around 900sf. We did fine. The one bathroom was the obvious choke point.

For years I have flown out of IAH and witnessed the old forests cut down being replaced by 3000-4000 SF boxes in the sun - and with 2 tiny trees planted in front. A portion of them with DINKs N Dog.
Never seemed logical with 95° summers …

 

[SeaJay]

The only shift we will see when the layoffs happen and people start losing their homes. But we have large institutional buyers ready to snap these properties.

Some of the large institutional buyers have been hit hard already, with a big buying spree during the times that prices were on the upswing and ending up over paying on some properties and selling at a loss.

It will be interesting to see if they are brave enough to jump back in full steam ahead if prices go low enough.

 

[Dave Hess]

The Most Splendid Housing Bubbles in America: Biggest Price Drops since Housing Bust 1. Record Plunge in Seattle (-3.9%), Near-Record in San Francisco (-4.3%) & Denver. Drops Spread Across the US | Wolf Street

wolfstreet.com

 

[zzyzzx]

 

[PimTac]

The Most Splendid Housing Bubbles in America: Biggest Price Drops since Housing Bust 1. Record Plunge in Seattle (-3.9%), Near-Record in San Francisco (-4.3%) & Denver. Drops Spread Across the US | Wolf Street

wolfstreet.com

This has been my observation in the Seattle Tacoma area. The brakes came on suddenly. I am still seeing homes going up for sale priced like nothing has happened. Sellers denial perhaps?

 

[GON]

The Most Splendid Housing Bubbles in America: Biggest Price Drops since Housing Bust 1. Record Plunge in Seattle (-3.9%), Near-Record in San Francisco (-4.3%) & Denver. Drops Spread Across the US | Wolf Street

wolfstreet.com

Dave,

When I look at every one of the charts in the link you provided. I see one thing. Every single-family home market TODAY IS WELL ABOVE THE SIGNLE FAMILY HOME MARKED AS OF JANUARY 2021. Every single one.

I wish the article showed a meaningful situation/ trend. It does not- just hype and clickbait. This chart is directly from the article.