Real Estate Crash thread

[byates1]

What say all about rfk's proposal in home ownership?

Something about uncle sam being a cosigner? Epic dumpster fire most likely.

"You will own nothing"

[climberevan]

RFK is a total clown, so that's the kind of stuff I'd expect. No one should take proposals offered by clowns seriously.

IMO pent up demand for moving and new household formation will drive things for a while until the low population growth starts to manifest. At least in my area, people are still building like crazy and others can't get enough of expensive remodels.

2 houses just went on the market on my street (like 15 houses total). One of them is by far the fanciest, and the other is probably second place. The first was on the market a year or so ago for over double what the last house on the street sold for, then it disappeared. Now it's back on for that same price. Someone might just pay $1.6M to live next door to a guy with like 10 broken antique tractors next door and my junk show down the street. People are loony.

[Toadman]

What say all about rfk's proposal in home ownership?

Something about uncle sam being a cosigner? Epic dumpster fire most likely.

"You will own nothing"

RFK is a Socialist. Or is it a Communist. No, I'm pretty sure that RFK is a Marxist. We already have enough gov't involvement in the housing market.

But there definitely is a need for more housing. With all those millions of not legal immigrants coming across the border, they will need roofs over their heads too.

Unfortunately, the majority of housing being built is high end, high dollar product.

[J. Barron DeJong]

Unfortunately, the majority of housing being built is high end, high dollar product.

There’s currently a record number of multi-family units being built in the country (though multi-family permits have dropped, so it doesn’t look like the record pace will continue).

[anotherVTskibum]

NYT gift link--article on big rental companies scooping up SFH and renting them in places that were historically owner-occupied.

https://www.nytimes.com/interactive/...smid=url-share

[J. Barron DeJong]

NYT gift link--article on big rental companies scooping up SFH and renting them in places that were historically owner-occupied.

https://www.nytimes.com/interactive/...smid=url-share

San Fran should stick it to the man by permitting a bunch of new housing to drive down prices and make those companies take a loss.

[Toadman]

No one wants to move these days. I have a former co-worker who took a job in the mid-west. Sold a home with a 3% mortgage and bought one with a 6.7% rate. Ouch. (I believe his new employer provided some moving funds that included some cash to help with the RE fee to sell his home.)

According to Redfin, 91.8% of US homeowners with a mortgage have an interest rate below 6%; 82.4% have a rate under 5%; and 62% have a rate below 4%. That’s far below last week's rate of 7.18% and a good reason to avoid selling a home and lose a much more attractive rate.

[summit]

Well the back-to-office people will have to balance the rate vs a new job. Or they'll rent a new place and rent out the old.

Anyone who doesn't face that quandary is gonna sell.

[::: :::]

That stat posted a page or two back: wages vs cost of major purchases over the last 20yrs is the main issue

No one wants inflation unless it’s their salary

RE market is going to continue to be a seller’s market because money is expensive and people can’t afford to find the next place even when the interest rates relax

[Ted Striker]

Those with equity, and those without.

[MontuckyFried]

Lots of factors. There are some good buys out there right now. Very few people are selling right now because they got themselves locked into these amazing sub 3% rates that they will maybe never see again. So, those that are selling have a real reason to that's worth them having to take on a new higher rate in a new house: In my office and my own listings its: Divorce, job relocation, having another kid and house is too small, moving to be close to grandkids, etc. Many have a timeline in mind so some sellers are getting very motivated....and like you said winter coming. Frost on the roof this AM here.

What's important to look at in MT RE right now: Since the peak of 2022 are home values are UP almost 4%. Literally everywhere else surrounding like WA, ID, WY, etc has gone down ever so slightly since last year.

Latest stat for Gallatin County shows 98% of list price received on recent sales. Inventory still low etc. It's certainly a weird market and in my opinion a great time to buy if you want to shoulder a higher rate for a bit. If you have an opportunity that pencils out go for it. If/when rates do pull back eventually there is still a ton of pent up buyer demand. Sure the rate might be better but you are gonna compete with 5+ offers when now you may be the only offer.

Interesting. Weird market indeed. FWIW, the home we were considering just went under contract, BUT with a lowball cash offer after sitting on the market for months. Lots of homes sitting with recent price drops. The higher end is completely tapped out and isn't budging. Big price drops on those. Seller of that home (relative of ours - estate sale kind of deal) said that she was in the agent's office this week and overheard a panicked co-worker complaining that TWELVE deals (in a not large market btw) have fallen through this week alone due to financing falling apart at the final hour. More deals there are crumbling than going through. That's not a good sign.

However, this makes me happy if things crash because these market do NOT reflect local wages and hasn't for years. Buncha Bay Area tech ex-pats continuing to screw everybody over with their WFH jobs. A solid correction is massively overdue. I'm truly hoping we're seeing the first pieces of this house of cards start to fall. I don't GAF if our own house halves in value if it means EVERYTHING gets adjusted to what it should be. Fingers crossed!

[not holding my breath tho cuz I've been holding out for a crash for years now and nothing seems to change]

[neckdeep]

However, this makes me happy if things crash because these market do NOT reflect local wages.

[not holding my breath tho cuz I've been holding out for a crash for years now and nothing seems to change]

Why would 2nd home STRs reflect local wages. Look around. The mountain town dirt pimps have been selling insanely priced houses based on the dream of easy passive income.

Price doesn't matter if the basic pitch is that the house pays for itself, generates some extra cash flow and appreciates faster than Tesla stock. The STR market was the best thing in decades to come along for realtors and the towns run for the benefit of dirt pimps reflect this.

[MontuckyFried]

Why would 2nd home STRs reflect local wages. Look around. The mountain town dirt pimps have been selling insanely priced houses based on the dream of easy passive income. Price doesn't matter if the basic pitch is that the house pays for itself, generates some extra cash flow and appreciates faster than Tesla stock.

That I get, but I'm not talking mountain towns or 2nd home STRs here. I'm talking historically working class towns in far less desirable regions. Things are SO out of whack.

[goldenboy]

Rates went down and prices declined for 5 years after gfc. Inventory for who?

Inventory for the people who want to buy homes. We haven't built enough homes for 15 years and there is a massive shortage across most areas of the country. That's why real estate is expensive, supply and demand 101. Right now the real estate market looks like the toilet paper aisle in March of 2020 (although that was a demand side shortage, not a supply side one).

The .1%ers aren't afraid of real estate right now, that's for sure. In the past couple of weeks a home sold for $10M (the first one ever at 10+), and another at 8.55. Those numbers might be an everyday occurrence in Aspen, but they're unheard of in Crested Butte.

The Franger buying a sub $1M ST rental with a loan though? They're still looking but they're scared. If there is even one thing slightly off they're out (not that there is much to look at anyway)

[skaredshtles]

<snip> historically working class towns in far less desirable regions.

You think tech bro's are moving to places like this? From *civilized* locations? I kind of think... probably not?

[MontuckyFried]

We haven't built enough homes for 15 years and there is a massive shortage across most areas of the country.

This is certainly true overall, BUT for the first time in a long time, I've been seeing some listings of unfinished new builds and extensive remodels. I believe the costs of construction may have outpaced the builders' original budgets, they've gone broke, and banks ain't lending out spec cash so easily anymore. I'm seeing them listed for good prices and they aren't budging. That has to mean something, right? Been following a listing nearby for a unfinished BIG home in a nice area. About 9000 sq ft on 2 acres. This should easily be 1.5-2 million dollar home given the market these last few years. It really only seems to wall texture (it's been rocked) and trim/finish work. It's mostly completed. Saw it listed for nearly 900K. Didn't budge. Dropped to 550K. Didn't budge. Just dropped to 249K and is finally under contract. I also caught wind of an entire brand new subdivision (more middle of the road prices) that is also unfinished and developer's trying to dump ASAP. Wife knows of one of the homeowners there and lady is not stoked that she just bought last Spring and now they're offering the homes for over a 100K less than what she paid. Seems to be a bit of a fire sale going on. Also a nice part of town. Hmmm......

[skaredshtles]

This is certainly true overall, BUT for the first time in a long time, I've been seeing some listings of unfinished new builds and extensive remodels. I believe the costs of construction may have outpaced the builders' original budgets, they've gone broke, and banks ain't lending out spec cash so easily anymore. I'm seeing them listed for good prices and they aren't budging. That has to mean something, right? Been following a listing nearby for a unfinished BIG home in a nice area. About 9000 sq ft on 2 acres. This should easily be 1.5-2 million dollar home given the market these last few years. It really only seems to wall texture (it's been rocked) and trim/finish work. It's mostly completed. Saw it listed for nearly 900K. Didn't budge. Dropped to 550K. Didn't budge. Just dropped to 249K and is finally under contract. I also caught wind of an entire brand new subdivision (more middle of the road prices) that is also unfinished and developer's trying to dump ASAP. Wife knows of one of the homeowners there and lady is not stoked that she just bought last Spring and now they're offering the homes for over a 100K less than what she paid. Seems to be a bit of a fire sale going on. Also a nice part of town. Hmmm......

Wait - a 9K sq ft house just sold for $249K?

That's... hilarious?

[Toadman]

I have 3 multi-million dollar homes going up within 2 blocks of me. Those with money have no issues. I'm guessing these are Cali. transplants. I've met our future neighbors but don't know their background. But they dropped some serious coin for the lot, and are bldg a mini-McMansion.

But living here in Bend, the 7 figure housing market seems to still be chugging along. Certainly not like during COVID but it is still alive and kicking.

[MontuckyFried]

You think tech bro's are moving to places like this? From *civilized* locations? I kind of think... probably not?

The billionaire tech bros? No. But the more run of the mill software engineers, absofreakinglutely. CA license plates are in abundance here and I can't tell you HOW many people I've met (often parents at my kids school or newcomers at the neighborhood pool) who have told me they're software who have recently come from CA. So yeah, they have definitely migrated to all over the country. I mean, look what happened to Boise!

I'm hearing that San Francisco office rentals are increasing, which HOPEFULLY is a sign that companies are calling their chickens back home. That would be rad for the rest of the country. Time for this RE idiocy to (hopefully) finally come to a stop.

[skaredshtles]

The billionaire tech bros? No. But the more run of the mill software engineers, absofreakinglutely. CA license plates are in abundance here and I can't tell you HOW many people I've met (often parents at my kids school or newcomers at the neighborhood pool) who have told me they're software who have recently come from CA. So yeah, they have definitely migrated to all over the country. I mean, look what happened to Boise!

I'm hearing that San Francisco office rentals are increasing, which HOPEFULLY is a sign that companies are calling their chickens back home. That would be rad for the rest of the country. Time for this RE idiocy to (hopefully) finally come to a stop.

Boise is hardly uncivilized. It's a city. And aren't you in San Antonio? Also civilized. I thought you were talking about places like Big Sandy, MT or Lubbock, TX.

[Conundrum]

Boise is hardly uncivilized. It's a city. And aren't you in San Antonio? Also civilized. I thought you were talking about places like Big Sandy, MT or Lubbock, TX.

4-5 years ago, there were three, maybe four bars with hand crafted cocktails over $12 and when you went out, you would always see folks you know in flips flops and t-shirts. Now, you can't swing a dead cat without hitting a a $20+ cocktail menu and all the people we don't know sure dress fancy. I think you and tucky are both right.

[neckdeep]

Boise is hardly uncivilized. It's a city. And aren't you in San Antonio? Also civilized. I thought you were talking about places like Big Sandy, MT or Lubbock, TX.

Yeah, Boise loves to promote that young techie story.....but the average transplant to the treasure valley had, in fact, nothing to do with tech.

Nearly two thirds are blue state refugees looking for lower cost of living retirement in a red, red state. Most identify as Republicans. Same thing here on the east side. Seems like for every remote worker there's a dozen retirees.

The funny thing about this place is its whiplash change in character. The new people don't actually do much outdoor stuff that people here used to do. For most of them, the biggest outdoor activity they've done lately was standing in line for a table at King Sushi. It's like a spoiled kid who has all the best toys but mostly just watches TV.

[Ted Striker]

The new people don't actually do much outdoor stuff that people here used to do. For most of them, the biggest outdoor activity they've done lately was standing in line for a table at King Sushi.

That's here too - except it's the shitty waterfront "seafood" restaurants with views.

[Foggy_Goggles]

Neck, gets it. I wonder if Grand County is unique in Colorado having 3 Republican County Commissioners and a major ski resort?

Real Estate isn't a commodity product. The unprecedented wealth inequality is pricing out more and more people in more and more places.

Even even remotely desirable locations, the bid is high simply because it is desirable no more no less.

Sent from my Turbo 850 Flatbrimed Highhorse

[summit]

I wonder if Grand County is unique in Colorado having 3 Republican County Commissioners and a major ski resort?

Probably.

Summit doesn't elect new commissioners. Old ones resign resign and new ones are appointed by the local Democratic party. Then they are incumbents when they run and they don't have to face a primary which is the only election that matters in this deep blue county.