Real Estate Crash thread

[Kevo]

Wealthy don't have that much stock. They don't need it. Old rubes are the ones getting hurt badly:

August 2019

Members of TIGER 21, an investment club for high-net-worth individuals, reduced their stock allocation to 21% from 22% during the second quarter, according to the group’s quarterly report.

TIGER 21, a group of about 700 people with at least $10 million to invest, stands for The Investment Group for Enhanced Results in the 21st Century.

“They are concerned about the fact that the markets were priced to perfection; they thought they reached real highs,” said Michael Sonnenfeldt, founder of TIGER 21.

They are putting people into PE funds, which is it's own kind of scam (high management fees and general underperformance in comparison to equities. PE had an OK run recently because of cheap money for leveraged buyouts, but that could come to an end.

[Benny Profane]

I’d basically agree with that.

But people with really deep pockets, due tend to buy in down turns.
Lots of people think they’re rich, until the shit hits the fan.

Pockets are a whole lot less deep, in general, today, than a month ago. And it's just started.

[Benny Profane]

Strange times. Average 30yr mortgage rate.

[liv2ski]

With FED liquidity (buying MBS) rates are coming back down again.

[iceman]

Got a viewing request for the house today. Told them to beat it. wtf like we want some coronavirus-unworried people traipsing through the house? And where exactly were we supposed to go while they walked around coughing on our shit? The state is basically locked down, nothing's open, not to mention that it's pouring out and 45 degrees. We don't need to sell the place that bad.

[AdironRider]

Buddy of mine listed his place last week and got an all cash offer for 1% under list with a 14 day close. Thought that was pretty solid in a tourist town.

I personally wouldn't sell now. If the resulting recession is short but deep RE will be fine and continue its trend. 18 months and sustained periods of unemployment will change my tune.

[liv2ski]

It's all good as long as payments are backstopped by the gubermunt or deferred. Once that shit is gone and people/businesses are not back to work and open, shit will get real in 6 months.

[Toadman]

Strange times. Average 30yr mortgage rate.

Cross posting from the Stock market thread. But basically the mortgage folks don't have a clue right now where mortgage rates are going to go. The two I have talked to this week have gone from the busiest ever since they have been in the biz, to stone cold zero activity.

FWIW, I'm seeing price drops on some 7 figure houses for sale here in Central Oregon. I don't think that will entice anyone to buy though.

[skaredshtles]

<snip>
FWIW, I'm seeing price drops on some 7 figure houses for sale here in Central Oregon. I don't think that will entice anyone to buy though.

"Hey, Biff - how long can you sustain that $6K/mo mortgage payment on savings alone?"

[mcphee]

"Hey, Biff - how long can you sustain that $6K/mo mortgage payment on savings alone?"

At least 3-6 months if they've done what they've chastised poor and regular folks for not being able to do.

[Rideski]

Hey page 333 same hour as rat flu. Strange days.

[Benny Profane]

"Hey, Biff - how long can you sustain that $6K/mo mortgage payment on savings alone?"

A lot of that market is floated by rentals. That's gone to zero and will be there for awhile. Big summer markets, like Summit County, are looking grim.

[Name Redacted]

A lot of that market is floated by rentals. That's gone to zero and will be there for awhile. Big summer markets, like Summit County, are looking grim.

Based on what?

[Benny Profane]

Based on what?

Based on most towns are a massive seasonal weekly rental market, and many buying decisions are based on that income. Summit has an as big, maybe bigger market in summer.

[AdironRider]

I thought I heard about it here, but for example, the Bay Area has seen a 50% uptick in weekly long term rental listings year on year as Airbnb and short term rentals get posted up for long term leases now.

[fastfred]

The short term rental market in Breckenridge and summit was over saturated with rentals anyways everyone thought they were original and going to kill it needs a correction to bad this one is pretty ugly

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[Toadman]

A lot of that market is floated by rentals. That's gone to zero and will be there for awhile. Big summer markets, like Summit County, are looking grim.

How about the Hamptons?

[Benny Profane]

How about the Hamptons?

That's a really bizarre market, the .1%. They were flocking there last week, escaping the city, but that might not continue, since they have no hospital beds or markets. I did read that some realtors are getting incredible offers for all summer plus March to June.

[Toadman]

That's a really bizarre market, the .1%. They were flocking there last week, escaping the city, but that might not continue, since they have no hospital beds or markets. I did read that some realtors are getting incredible offers for all summer plus March to June.

I would think the rich and famous and not so famous would be hiding out on Long Island these days. I suppose if things get bad, they can always hire a private heli to get somewhere quick and avoid the LIE

[4matic]

The short term rental market in Breckenridge and summit was over saturated with rentals anyways everyone thought they were original and going to kill it needs a correction to bad this one is pretty ugly
]

I checked out Marriott cleaning protocol vs Airbnb. Airbnb is a suggestion.

[kokomas]

listings are way up in utardia north of slc, though buyers seem to be still on point and enjoying the increased inventory, for now

[Name Redacted]

Based on most towns are a massive seasonal weekly rental market, and many buying decisions are based on that income. Summit has an as big, maybe bigger market in summer.

We make enough to pay for our place for the year over the winter. We hardly rent at all in the summers anyway. I also haven’t seen a massive increase in inventory or drop in prices yet. People aren’t panicking. Many aren’t stupid enough to not have a backup plan at least to get through a few months without income.

[Benny Profane]

We make enough to pay for our place for the year over the winter. We hardly rent at all in the summers anyway. I also haven’t seen a massive increase in inventory or drop in prices yet. People aren’t panicking. Many aren’t stupid enough to not have a backup plan at least to get through a few months without income.

Dude, I'm sure that, if you've been listening to or watching media the past few weeks, you've heard about the oft told quote from the Fed last year, that 40% of Americans can't come up with 400 dollars cash in an emergency. Now, you may scoff and think, oh, that's the Deplorables, which it is, of course, but don't kid yourself that that scales up to the other half, minus the top 1%, who have built a nice house of cards out of their financial life, based on credit and probably dual salaries, that could disappear in the matter of months if spending isn't reeled in pronto. I mean, the entire, the entire fucking restaraunt industry didn't just vanish in '08, just to mention one business. Poof.
Now, I'm more surprised than anybody that mountain RE bounced back after 08. I thought I'd have the pick if the litter at closeout prices. Nope. Just the opposite. We'll see what happens now. Maybe, in white privilege land, mom and dad save the kids from harm, and the economy bounces back, and its back to the races to an even more unequeal society. Maybe not. But, there has to be a ton of mountain RE people who are in the edge of affordability, and will liquidate out of necessity, especially if they are jobless for a while. Deals may only last a few years, if at all, so, I'm watching.

[liv2ski]

I have seen 2 homes in my little hood bought in the last 12 months and now listed. Looks like someones income got fucked up?

[klauss]

I know a nice young family that recently upgraded/closed on a very expensive house and see that their old house just went on the market. They must have some good coin in the bank to get approved for the new place before selling the old one but I cringe at the timing.