Real Estate Crash thread

[yeahman]

My fire insurance went up 50%. I knew it was dire after the Caldor fire, increased values, and re-rating in all of California. Add that to higher mortgage rates.

I called my insurance company and increased my coverage by 20% after reading about all the people whose homes burned in the Boulder fire who found themselves drastically undercovered due to inflation, lack of labor, etc. The insurance company already adjusts a few percent a year for inflation, and also builds in a cushion for cost overruns, but as I suspected, when I ran the numbers with them and compared it to current local building costs per sq. ft., they were way behind. And I live in a fire-prone area.

[fastfred]

I called my insurance company and increased my coverage by 20% after reading about all the people whose homes burned in the Boulder fire who found themselves drastically undercovered due to inflation, lack of labor, etc. The insurance company already adjusts a few percent a year for inflation, and also builds in a cushion for cost overruns, but as I suspected, when I ran the numbers with them and compared it to current local building costs per sq. ft., they were way behind. And I live in a fire-prone area.

never trust an insurance company

"also builds in a cushion for cost overruns" I hope you made that up and no one from an insurance company said that to you because its total bullshit I've delt with tons of insurance claims and their numbers are squeezed so tight its stupid trying to justify a cost over run or that their computer program is off by a few bucks per sq ft on a task is hopeless

only one claim I did was the adjuster and insurance company 100% on board with me

[Mazderati]

...or no apparent signs of trouble brewing but living on credit. Well the look of desperation in their eyes is a sign but pretty easy to miss behind the big smiles and bluster.

The Stanley Johnsons.

[yeahman]

never trust an insurance company

"also builds in a cushion for cost overruns" I hope you made that up and no one from an insurance company said that to you because its total bullshit I've delt with tons of insurance claims and their numbers are squeezed so tight its stupid trying to justify a cost over run or that their computer program is off by a few bucks per sq ft on a task is hopeless

only one claim I did was the adjuster and insurance company 100% on board with me

Totally agree you need to watch your ass with them. The policy has language that spells out the overrun policy, but I'm sure you're right that trying to get anything out of them is a PITA. This is why I upped my coverage beyond what they said I needed, and also did all correspondence by email so I had a record of everything. Fingers crossed I never need to use it. Insurance is the biggest fucking scam known to mankind, all you need to do is watch the endless stream of insurance commercials on TV to know they are fucking everybody over--otherwise they wouldn't have so much $$$$$$ to advertise. That said, I've also had insurance work in my favor more than once. In any case none of us has a choice but to play the game as best we can.

[Tri-Ungulate]

That's from the viewpoint of Dan the man.

* - For those that don't know the quote:

"A well-built physique is a status symbol. It reflects you worked hard for it; no money can buy it. You cannot borrow it, you cannot inherit it, you cannot steal it. You cannot hold onto it without constant work. It shows discipline, it shows self-respect, it shows patience, work ethic, and passion."

Wasatch forecast is bleak, so if self-sacrifice is a thing I'll play.

...

[climberevan]

I'm surprised it took this long for someone to post that photo. Awesome status symbol, DTM!

I'm def in the buy less house than you can afford camp. I bought a junk show and paid it off in 5 years, and I'll never borrow money again for anything. The security of always having a place to live no matter what other shit befalls me is a really great feeling. I just don't understand how so many people can live so hand to mouth.

[liv2ski]

Paid off in 5 years is amazing. Well done.

[4matic]

Toll Brothers Reno has 36 quick move in houses available and have extended the “sale event”. Two years ago they didn’t even offer the sale event in Reno.

https://www.tollbrothers.com/luxury-homes/Reno-NV

[Toadman]

Apparently there IS a lot of crying in RE.

https://www.yahoo.com/finance/news/c...191424173.html

The real estate website found that half of U.S. homebuyers cry at least once during the exhaustive process. Additionally, almost 90% of recent buyers surveyed said at least one aspect of buying a home proved stressful.

Zillow surveyed about 2,000 Americans who either bought or intended to buy a house in the past two years as housing costs became – and remains – at a premium.

What replaced the tears of joy that can come when purchasing a house? Zillow found that about 62% of potential homebuyers were stressed about being able to find a home within their budget; about 61% were stressed about not having enough houses to choose from; and 58% were stressed about finding a home in their desired neighborhood.

"I think we were surprised by the share of recent buyers who said they cried at least once, as there were some who cried at least five times while looking for a home," Zillow home trends expert Amanda Pendleton told USA TODAY.

[Toadman]

Toll Brothers Reno has 36 quick move in houses available and have extended the “sale event”. Two years ago they didn’t even offer the sale event in Reno.

https://www.tollbrothers.com/luxury-homes/Reno-NV

Some nice looking houses.

[4matic]

Some nice looking houses.

Rancharra seems a bit overpriced. I was up there last week. So much traffic in south meadows now.

[rideit]

Was just announced in the paper here that the ‘cheaper’ private housing complex (not subsidized/affordable, etc) is likely going up to a possible $4400 for a two bedroom. A small two bedroom, at that.

[Dantheman]

Not everyone is house poor that has a nice house. Sure there's a certain set of people that over-extended and bought more than they needed but I think they are in the minority. The house poor is your middle class, living in a house that they can barely keep the lights on, gas in the 15 year old beater, and food on the table.

I didn't mean to imply that everyone with a fancy house is house-poor. I'm not even making a value judgement on people who choose to buy an unaffordable house. My point was that the seemingly irrational decision to buy an unaffordable house probably has some deep roots in evolutionary biology.

I'm surprised it took this long for someone to post that photo. Awesome status symbol, DTM!

LOL, I'll never live that down.

[Kevo]

Inventory is rising and I'm starting to see some price reductions in my neighborhood.

Some mediocre house sold for $1.2mm a couple months ago. Another mediocre home that is similar just reduced their price below $900k.

Last summer every STR in Teton Valley was booked out for the month of August. I wonder if inflation and gas prices will keep people from vacationing this summer. If so I expect a lot of people to be cash flow negative on their AirBnB investments, which may lead to more inventory.

I'm seeing news stories of average 30 year rates above 6%. Can anyone in the industry (L2S?) confirm?

[up an down]

Inventory is rising and I'm starting to see some price reductions in my neighborhood.

Some mediocre house sold for $1.2mm a couple months ago. Another mediocre home that is similar just reduced their price below $900k.

Last summer every STR in Teton Valley was booked out for the month of August. I wonder if inflation and gas prices will keep people from vacationing this summer. If so I expect a lot of people to be cash flow negative on their AirBnB investments, which may lead to more inventory.

I'm seeing news stories of average 30 year rates above 6%. Can anyone in the industry (L2S?) confirm?

Business Insider website says the average is 5.45% today

[J. Barron DeJong]

Business Insider website says the average is 5.45% today

Mortgage News Daily says rates went up .28% today, to 6.13%

https://www.mortgagenewsdaily.com/mortgage-rates

[snapt]

Last summer every STR in Teton Valley was booked out for the month of August. I wonder if inflation and gas prices will keep people from vacationing this summer. If so I expect a lot of people to be cash flow negative on their AirBnB investments, which may lead to more inventory.

Hotel bookings are down 75% so far this summer in the valley, guessing STR mirrors that.

[mud]

Mortgage News Daily says rates went up .28% today, to 6.13%

https://www.mortgagenewsdaily.com/mortgage-rates

MBS shit the bed today because inflation is not going anywhere soon.

[goldenboy]

Hotel bookings are down 75% so far this summer in the valley, guessing STR mirrors that.

75%? Really? That sounds amazing as busy as things have been around here. They're saying down 5-6% here. Wouldn't be surprised if that creeps up if gas prices stay high and some front rangers choose to stay closer to home.

Inventory remains nearly nonexistent here, still seeing multiple offers in a lot of cases.

[mud]

Attachment 418794

[AdironRider]

Hotel bookings are down 75% so far this summer in the valley, guessing STR mirrors that.

They're about to get worse with the Yellowstone closures.

75%? Really? That sounds amazing as busy as things have been around here. They're saying down 5-6% here. Wouldn't be surprised if that creeps up if gas prices stay high and some front rangers choose to stay closer to home.

Inventory remains nearly nonexistent here, still seeing multiple offers in a lot of cases.

Teton Valley has a bit of a history of crashing much harder than other areas. 75% does seem pretty much unbelievable though.

[Stu Gotz]

MBS shit the bed today because inflation is not going anywhere soon.

No bids in size in MBS land. By all accounts mortgage lending is freezing up in the short-term.

[Kevo]

Hotel bookings are down 75% so far this summer in the valley, guessing STR mirrors that.

That's a pretty incredible stat. Damn.

There is currently only one halfway decent hotel in Teton county ID. The others are more like low end motels or various forms of "specialty" lodging. I believe this has increased demand for STRs.

The new Marriott in Driggs will add 107 rooms additional inventory to nightly rentals, with a 24 hour front desk and without cleaning fees and other hoops to jump through. I think it'll add some significant competition to AirBnBs.

It'll be interesting to see what happens as the tide goes out.

[mattig]

Yes, rates are over 6. But see the bottom part of today's article for the qualifications:

https://www.mortgagenewsdaily.com/ma...rates-06132022

[mattig]

MBS shit the bed today because inflation is not going anywhere soon.

5.0 coupon eh? Not quite yet, despite the fact that it makes logical sense.

Doesn't really matter as they all tanked today, but it will definitely matter if you're getting false positives on reprice risk in the coming days because liquidity is still in 4.0 and (just barely) 4.5s.