Real Estate Crash thread

[Stu Gotz]

The high end summer market, hell, the whole summer rental market is toast. A lot of real estate "entrepreneurs" near beaches should sell now.

I never really got my head around the 2nd home vacation market pricing. It's either a family has an extra $1-$3 million laying around (or an extra $10k a month) for the family beach compound, or the spread is so wide between rentals and mortgage that it doesn't make sense for an investment property. Anything under $1 million at the beach is a tear down.

[VTeton]

I tossed in an offer for 30% below ask today on a summer crib all doom and gloom to see how badly they wanted to sell. They weren't angry about the offer but broker said they cant consider it only being on the market a month. lookout below!!!

Another guy tossed up a 2 family this week and wants best offers by 2pm tuesday. estate sale, may insult him as well.

I never really got my head around the 2nd home vacation market pricing. It's either a family has an extra $1-$3 million laying around (or an extra $10k a month) for the family beach compound, or the spread is so wide between rentals and mortgage that it doesn't make sense for an investment property. Anything under $1 million at the beach is a tear down.

[skifishbum]

Well I just bought a second home. Wife and I are definite outliers, two stable incomes, high savings, but no way I’m renting or staying in hotels any time soon, so I plunked down the cash for a nice new construction 3 bedroom 2 bath abode (condo) 1400 sq ft. in the Georgetown SC / litchfield beach area. Pricing was competitive but activity was brisk. Was it the ideal time, probably not, but wife and kids were not sitting in the house anymore. The area has tons of rivers and estuary for fishing, beaches and lots of land for hunting in the fall. Charleston is 1 hour and change south.
We normally travel a lot, but she wanted something different but within driving distance.
I’m sure bunny will tell me it will be under water in 10 years, literally and figuratively but I don’t care. If I get that long out of it, I’ll be happy. I don’t care if it goes down in value or goes up either. It’s a consumable expense at this point but a definite shift in family resources from flying, renting type vacations to “owning”.
I would not have purchased if not for lock down and reassessment of future mobility.

Iceman- if you want to swap places in the winter with your soli place I’ll gladly give you details. Georgetown is authentic and the fishing is top notch.


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while not slopeside soli our crib is way roomier way and closer to the lcc epicenter of radness and my mancave is next level and you can ski anything in it your boots fit in
ill throw in the use of the 4 runner or subie
im gonna need a decent boat on your end though

[Benny Profane]

I never really got my head around the 2nd home vacation market pricing. It's either a family has an extra $1-$3 million laying around (or an extra $10k a month) for the family beach compound, or the spread is so wide between rentals and mortgage that it doesn't make sense for an investment property. Anything under $1 million at the beach is a tear down.

Well, it certainly has done well in a diversified portfolio over the past few decades. The guvment has your back with tax breaks and zero interest rates. Then there's the rental income, if location is good.

[iceman]

Our house has been for sale for the whole pandemic pretty much. It went on the market in February right before the shit hit the fan. I'm on record somewhere earlier in this thread as saying there's no way there'd be any chance of it selling, or even of people having any interest in it, until this whole thing was behind us. Well it still hasn't sold, but people have basically been beating the door down.

We've gotten at least a dozen seemingly-serious inquiries in recent weeks. I say "seemingly" because the law has been laid down here (not by me) and nobody is allowed inside the house. Apparently nobody wants to actually make an offer on a house they can't go inside and look at, go figure. But some of these people have been in touch through their agents multiple times, trying to figure out a way to get inside. I'm pulling my hair out over it but I'm in a no-win situation on that.

But if you wanted to be near Washington DC and also be a social-distancing star, this is a really really good place for it. We're surrounded by woods, and border thousands of acres of wooded parkland on three sides of a pentagon-shaped property. We can't even see a neighbor's house -one's not that far away but is hidden behind a thick evergreen screen and some woods, but nobody else is even close.

I think people are interested in this house because of the pandemic, and I kind of think it's another indication that the trend towards urbanism we've seen over the past 20 or so years may really be over. Certainly my daughter and her boyfriend, who live in Manhattan and loved it until this came along, have no interest in returning there. And their friends, by all reports, feel the same way. The people who flocked to the cities seem to be interested in space and quiet and distance now. To me it doesn't feel like a blip but more like a change in the whole zeitgeist.

Hell I'm kinda thinking about raising the price on the place.

[frorider]

another indication that the trend towards urbanism we've seen over the past 20 or so years may really be over.

Agree. Common theme in so many interviews and articles. seems that people are trying to find the unicorn places that have lowish density but good access to great health care, schools, etc.

So suburban utopia. Hello Applebees.

[Benny Profane]

Bodes well for my town. Sad, though. I like visiting cities, but they seem to be fucked for maybe years.

[MiddleOfNight]

I think people are interested in this house because of the pandemic, and I kind of think it's another indication that the trend towards urbanism we've seen over the past 20 or so years may really be over.

Your idea makes sense. RE prices out here in the sticks aren't falling either. At all. Neither is commercial RE in nearby little towns.

Hello Applebees.

Oh .. dang. They just built a Chili's maybe 40 miles from here.
So it begins.

[glademaster]

It's still too early to see much of a price drop anywhere yet. There are still people out there who think this is going to be a blip on the economic radar, and as XXX-er put it, people haven't had time to fail yet.

[Self Jupiter]

Commercial real estate hadn’t appreciated nearly as much as residential in my area (greater Boston / north of town) before the virus. Since then, many local lenders froze their lending ops on commercial property. Those restrictions are easing, but the future for ‘’common’’ commercial real estate feels pretty grim IMO.

The demand for warehouse space will likely continue to grow, and properties suitable for weed cultivation still feel like a pretty solid investment.

[ncskier]

while not slopeside soli our crib is way roomier way and closer to the lcc epicenter of radness and my mancave is next level and you can ski anything in it your boots fit in
ill throw in the use of the 4 runner or subie
im gonna need a decent boat on your end though

Thanks for the offer. Waiting on a boat survey right now as we speak.

[splat]

I can't help but think people will be selling everything, including the kitchen sink, for 30% of value when the overextended hit the bottom.

[Danno]

Commercial real estate hadn’t appreciated nearly as much as residential in my area (greater Boston / north of town) before the virus. Since then, many local lenders froze their lending ops on commercial property. Those restrictions are easing, but the future for ‘’common’’ commercial real estate feels pretty grim IMO.

The demand for warehouse space will likely continue to grow, and properties suitable for weed cultivation still feel like a pretty solid investment.

yeah, I think commercial office space has a grim future. So many office workers are now WFH, and when businesses see that they can squeeze similar productivity out of that arrangement, they're going to downsize their office space.

[Timberridge]

Iceman, if you get an acceptable offer during this period, make sure you and the buyer account for the fact that it's taking longer to close right now (by having longer mortgage lockups on their end or contract riders that allow you extra time to vacate the place.) I just sold a home and the closing was pushed out 3x already by a week each time due to an inability get the documentation from the town, inspections, appraisals done, etc.. And trying to get a moving company right now is impossible.

[Self Jupiter]

One of the only useful things our local realtor association has done ‘’in these challenging times’’ is put together a boilerplate addendum to be attached to offers / purchase agreements which essentially states all parties agree to anticipate and deal with the types of delays referenced above.

TR, you got an offer. Haven’t you been trying to sell the house for years? congrats

[Timberridge]

TR, you got an offer. Haven’t you been trying to sell the house for years? congrats

True. I had it priced a bit high as I didn't really know if I wanted to sell it or add to it so it was on the market for 1.5 yrs. Along that time, I dealt with just about every crazy realtor and potential buyer the VT real estate market could throw at me. It's an old farm and the most interesting offer I had was 3 families of hippies who wanted to buy it together and live there. I had to explain to them that their price was too low even with the hand crafted pottery and handwritten note that accompanied it, furthermore the property was deed restricted and couldn't be subdivided. Upon which they told me through their realtor they were all planning to live in a 5 bedroom farmhouse together.

The real estate market up there is unique.

[liv2ski]

I can't help but think people will be selling everything, including the kitchen sink, for 30% of value when the overextended hit the bottom.

There will be some of that for sure, but with guberment paying people $4k in UE benefits for a few months and then proposed UI of at least $2k a month + rent and mortgage payment forbearance, hopefully not to many people miss out on the once in a life time give away.

[XXX-er]

yeah, I think commercial office space has a grim future. So many office workers are now WFH, and when businesses see that they can squeeze similar productivity out of that arrangement, they're going to downsize their office space.

I agree, worker drones use an average of 200 sq' in a cube farm which is a lot of RE

[iceman]

Iceman, if you get an acceptable offer during this period, make sure you and the buyer account for the fact that it's taking longer to close right now (by having longer mortgage lockups on their end or contract riders that allow you extra time to vacate the place.) I just sold a home and the closing was pushed out 3x already by a week each time due to an inability get the documentation from the town, inspections, appraisals done, etc.. And trying to get a moving company right now is impossible.

Thanks I'll keep it in mind.

[Self Jupiter]

The real estate market up there is unique.

I had a close friend buy a place in the area a few years back and sometimes we would get on a call for a few minutes while they were on a house tour. I remember one of the agents spent the time we were on the call wandering about collecting rocks on the property to show my friend and his wife once the call was done. This rock had this energy, that rock meant this was coming.

[Toadman]

Agree. Common theme in so many interviews and articles. seems that people are trying to find the unicorn places that have lowish density but good access to great health care, schools, etc.

So suburban utopia. Hello Applebees.

The Applebees in my town closed. That was just before the pandemic hit. Maybe an early indicator? More likely there were just better options for food. And the location sucked.

[Benny Profane]

[Benny Profane]

Forbearance

https://taibbi.substack.com/p/the-ba...ion-that-could

[liv2ski]

Honestly could not read it all, such a cluster fuck, just like telling tenants, "you don't have to pay your rent". Cool Uncle Sam, then you send me the check. I am sure the servicers feel the same way. Stoopid politicians.

[CascadeLuke]

Our house has been for sale for the whole pandemic pretty much. It went on the market in February right before the shit hit the fan. I'm on record somewhere earlier in this thread as saying there's no way there'd be any chance of it selling, or even of people having any interest in it, until this whole thing was behind us. Well it still hasn't sold, but people have basically been beating the door down.

We've gotten at least a dozen seemingly-serious inquiries in recent weeks. I say "seemingly" because the law has been laid down here (not by me) and nobody is allowed inside the house. Apparently nobody wants to actually make an offer on a house they can't go inside and look at, go figure. But some of these people have been in touch through their agents multiple times, trying to figure out a way to get inside. I'm pulling my hair out over it but I'm in a no-win situation on that.

But if you wanted to be near Washington DC and also be a social-distancing star, this is a really really good place for it. We're surrounded by woods, and border thousands of acres of wooded parkland on three sides of a pentagon-shaped property. We can't even see a neighbor's house -one's not that far away but is hidden behind a thick evergreen screen and some woods, but nobody else is even close.

I think people are interested in this house because of the pandemic, and I kind of think it's another indication that the trend towards urbanism we've seen over the past 20 or so years may really be over. Certainly my daughter and her boyfriend, who live in Manhattan and loved it until this came along, have no interest in returning there. And their friends, by all reports, feel the same way. The people who flocked to the cities seem to be interested in space and quiet and distance now. To me it doesn't feel like a blip but more like a change in the whole zeitgeist.

Hell I'm kinda thinking about raising the price on the place.

I read that the property is sealed. I’d offer one suggestion that’s selling homes here sight unseen in some cases. Especially a month ago when no enter orders were active. It’s Matterport virtual home shoots - cameras make for a 3D presentation tool. Maybe you’re aware. It seems if several of the interested parties were open to writing offers after this visual. Then you could let one person in who is trained to take precautions and reach every party, including others ongoing. I’m cringing a little, as an agent, about not bridging a deal together considering days on market etc. Unless of course you now see inherent value you took for granted and want to stay. Otherwise follow the hunch and dump it before shit perhaps declines and interest wains for years.