OT: Why the real estate market is not in a bubble: Q1 2023 update video added to OP

[Knight Shift]

Trump Cuts Legal Immigrants By Half And He’s Not Done Yet

Donald Trump has reduced legal immigration by an estimated 49%, which will have a significant negative impact on U.S. economic growth.

www.forbes.com

The National Foundation for American Policy projects that the number of legal immigrants will decline by 49% (or 581,845) between FY 2016 and FY 2021 due to Trump administration policies. (From the FY 2016 total of 1,183,505 down to 601,660 in FY 2021.) How did the Trump administration reduce legal immigration by 49% without changing U.S. immigration law? The answer is by using executive and administrative authorities, some of which are being challenged in court.

Below is a review of the impact of administration policies on legal immigration categories since Donald Trump became president.

Immediate Relatives of U.S. Citizens: The Immediate Relatives of U.S. Citizens category is projected to decline by over 50% between FY 2016 and FY 2021, meaning about 300,000 more spouses, children and parents of U.S. citizens would have been reunited in FY 2021 absent Trump administration policies

Refugees (including the Cuban Adjustment Act):The number of refugees gaining permanent residence (a green card) is expected to decline significantly from FY 2016 to FY 2021.

For FY 2020, the Trump administration established an annual ceiling for refugees 84% lower than the final year of the Obama administration (from 110,000 down to 18,000), and as of July 17, 2020, only 7,848 refugees have arrived in the United States in FY 2020.


Forbes Magazine owned by Steve Forbes, very conservative.

Trump is proposing to limit student visas to two years for citizens of 59 countries

The countries affected include Vietnam, Nigeria, Nepal, and Iran.

www.vox.com

You people are funny. Straight from DHS website. No meaningful decline 2016-2019 vs. 2011-2015. Before you all wet your pants of 2020, we all know what happened that year.

PERSONS OBTAINING LAWFUL PERMANENT RESIDENT STATUS BY TYPE AND MAJOR CLASS OF ADMISSION: FISCAL YEARS 2011 TO 2020

PERSONS OBTAINING LAWFUL PERMANENT RESIDENT STATUS BY TYPE AND MAJOR CLASS OF ADMISSION: FISCAL YEARS 2011 TO 2020
Type and class of admission	2011	2012	2013	2014	2015	2016	2017	2018	2019	2020
TOTAL
Total	1,062,040	1,031,631	990,553	1,016,518	1,051,031	1,183,505	1,127,167	1,096,611	1,031,765	707,362

Yearbook 2020 | OHSS - Office of Homeland Security Statistics

www.dhs.gov

 

[fg7321]

You people are funny. Straight from DHS website. No meaningful decline 2016-2019 vs. 2011-2015. Before you all wet your pants of 2020, we all know what happened that year.

PERSONS OBTAINING LAWFUL PERMANENT RESIDENT STATUS BY TYPE AND MAJOR CLASS OF ADMISSION: FISCAL YEARS 2011 TO 2020

PERSONS OBTAINING LAWFUL PERMANENT RESIDENT STATUS BY TYPE AND MAJOR CLASS OF ADMISSION: FISCAL YEARS 2011 TO 2020
Type and class of admission	2011	2012	2013	2014	2015	2016	2017	2018	2019	2020
TOTAL
Total	1,062,040	1,031,631	990,553	1,016,518	1,051,031	1,183,505	1,127,167	1,096,611	1,031,765	707,362

Yearbook 2020 | OHSS - Office of Homeland Security Statistics

www.dhs.gov

The real interesting thing about immigration is in 1924 the National Origins act severely limited the amount of immigrants from countries that were seen as undesirable. Quite interesting reading . google Johnson -Reed Act

 

[mdk01]

The real interesting thing about immigration is in 1924 the National Origins act severely limited the amount of immigrants from countries that were seen as undesirable. Quite interesting reading . google Johnson -Reed Act

Are we changing the subject? And wasn't that act actually repealed about 50 years ago and effectively repealed after WWII?

 

[Knight Shift]

Back to the topic at hand, the bubble is bursting.

A housing market reset has become 'a bit more than that': Morning Brief

Here's what to watch in the markets on Friday, June 17, 2022.

finance.yahoo.com

 

[anon_0k9zlfz6lz9oy]

Back to the topic at hand, the bubble is bursting.

A housing market reset has become 'a bit more than that': Morning Brief

Here's what to watch in the markets on Friday, June 17, 2022.

finance.yahoo.com

That article says nothing of that sort haha.

but for all the bubble boys I ask the same questions
1) what do you define as a bubble bursting. Aka how far would prices have to fall?
2) what data do you present to support your claim
3) depending upon your answer to number one how much would you be willing to wager youre right?

 

[theRU]

That article says nothing of that sort haha.

but for all the bubble boys I ask the same questions
1) what do you define as a bubble bursting. Aka how far would prices have to fall?
2) what data do you present to support your claim
3) depending upon your answer to number one how much would you be willing to wager youre right?

I live in my own little bubble because its all I care about. I'm seeing prices down in orange county CA 5-10% off the highs already.

I define bubble as 20-25% range drop.

If the 2mm homes are going to start going for 1.5 or close to it I will deem myself as being correct

There will also need to be some suddeness to the decrease, perhaps once all the elements are in motion we'll see a strong decline over a 3-6 month period.

Not a gradual decrease over 1+ years

 

[anon_0k9zlfz6lz9oy]

I live in my own little bubble because its all I care about. I'm seeing prices down in orange county CA 5-10% off the highs already.

I define bubble as 20-25% range drop.

If the 2mm homes are going to start going for 1.5 or close to it I will deem myself as being correct

There will also need to be some suddeness to the decrease, perhaps once all the elements are in motion we'll see a strong decline over a 3-6 month period.

Not a gradual decrease over 1+ years

Very fair definition. Some try to set the bar super low to 2012 as the technical definition of a bubble is prices go back to beginning of run up which has been in this case since 2012. Ill define bubble here as losing 2 years of price gains and going back to 2020 which would be a 30% decline. With that said, i personally see price appreciation cooling from 20% YOY nationwide to 0-3% price appreciation nationwide over next 12-18 months or so

 

[koleszar]

It’s all about degree. Don’t see GFC crash but 10-15% likely. More acronyms for @Knight Shift and company.

You got to stop man. I'm starting to feel really fvcking old over here. Plus I spend about 5 mins. trying to decipher what your hieroglyphs mean.

 

[theRU]

You got to stop man. I'm starting to feel really fvcking old over here. Plus I spend about 5 mins. trying to decipher what your hieroglyphs mean.

Hey @koleszar lmgtfy..... 🤣

Gfc Meaning

For those who think it's easier to annoy you than to Google 'Gfc meaning' themselves.

letmegooglethat.com

 

[bostavan]

Every year the real estate market becomes more and more popular, and no wonder because real estate is one of the most stable assets, the value of which is constantly growing. I have been working in real estate for a long time, and it is the only source of income for me. There is a global crisis, so I think all markets are going down. I have read the background information on the real estate market crash here https://timthomas.co/signs-of-a-housing-market-crash/, and I think many of the signs are the same.

 

[bob-loblaw]

I've personally found this to be one of the more enjoyable subs on Reddit

Reddit - Dive into anything

www.reddit.com

 

[CERU00]

Rea

I'm not sure why you are not sure why I am giving him that feedback. But it's OK. I give up.

And on his being incorrect, I agree with you (at least I think I do).

BTW, what do people consider HNWI? From Investopedia: "People who fall into this category generally have at least $1 million in liquid financial assets."

That seems like a really low bar these days?

Really low bar? Seems like a reasonable number to me. I would guess most of the middle class have vast majority of assets in home and retirement account.

 

[Wolv RU]

I live in my own little bubble because its all I care about. I'm seeing prices down in orange county CA 5-10% off the highs already.

I define bubble as 20-25% range drop.

If the 2mm homes are going to start going for 1.5 or close to it I will deem myself as being correct

There will also need to be some suddeness to the decrease, perhaps once all the elements are in motion we'll see a strong decline over a 3-6 month period.

Not a gradual decrease over 1+ years

In this inflationary environment, prices won't even have to go down in a year to have the value drop 10%. For example, 300k 10 years ago is equivalent to over 380k in current dollars.

300k in 2020 is equivalent to almost 340k in current dollars. If prices even go back to 2020 levels, that is actually going to be an enormous loss for people. If prices stay the same or drop slightly with 10% inflation, that is going to be a big loss in value.

We haven't lived in an era with this level of inflation in more than a generation. Thinking will need to be adjusted to account for it. A dollar yesterday is going to be worth a lot more than a dollar tomorrow.

 

[tom1944]

Bloomberg has an article that builders are slashing prices in areas of the Sun Belt

 

[anon_0k9zlfz6lz9oy]

Bloomberg has an article that builders are slashing prices in areas of the Sun Belt

Yup. Builders kept trying to push and push. Market is going from gangbusters to normal. People have a weird belief that normal means collapse though lol. 0-3% appreciation rates annually next couple years after 20%+ YOY

 

[theRU]

Yup. Builders kept trying to push and push. Market is going from gangbusters to normal. People have a weird belief that normal means collapse though lol. 0-3% appreciation rates annually next couple years after 20%+ YOY

You can keep saying this but it doesn't mean it's true. The economy is about to get it's ass kicked

 

[anon_0k9zlfz6lz9oy]

You can keep saying this but it doesn't mean it's true. The economy is about to get it's ass kicked

Stock market isnt housing. Whats your prediction on housing price drops and over what period of time? And how much are you willing to wager on the prediction?

 

[tom1944]

Stock market isnt housing. Whats your prediction on housing price drops and over what period of time? And how much are you willing to wager on the prediction?

I always thought every housing market was unique to itself

So while one market might collapse another could boom.

That could even apply within an individual State

 

[anon_0k9zlfz6lz9oy]

I always thought every housing market was unique to itself

So while one market might collapse another could boom.

That could even apply within an individual State

Agree. Which is why my basis metric here is using national numbers. Every market is different

 

[theRU]

Stock market isnt housing. Whats your prediction on housing price drops and over what period of time? And how much are you willing to wager on the prediction?

The stock market isn't the economy either. I've already stated what's going to happen.

You keep repeating 0-3% yoy/ appreciation.

 

[jtung230]

NJ transit strike. All trains canceled. Maybe more people will move back into the city again.

 

[anon_0k9zlfz6lz9oy]

The stock market isn't the economy either. I've already stated what's going to happen.

You keep repeating 0-3% yoy/ appreciation.

You think 25% nationwide?

 

[theRU]

You think 25% nationwide?

Not sure what national metrics are available but certain expect the news in the headlines to be about how the market burst

 

[anon_0k9zlfz6lz9oy]

Not sure what national metrics are available but certain expect the news in the headlines to be about how the market burst

Case shiller index, most objective metric. https://fred.stlouisfed.org/series/CSUSHPISA

 

[MulletCork]

Just a small sample of a tenuous situation to me….

Own a 2 BR / 2 BA condo in SWFL. Neighbor bought hers for maybe $350K in early 2019. Pretty affordable!
Low taxes and decent HOA

Sold for $645K this spring. Awesome for her. Do not want to be that buyer holding this bag at $645K. Been down here off and on for 17 years. My coworker for 39 years.

Neighbor did no improvements whatsoever to the place. Flipped it furnished too. That’s not a sustainable market by any metric.

 

[jtung230]

So much for the bubble. My neighbor’s house sold after 1 open house.

 

[Section124]

So much for the bubble. My neighbor’s house sold after 1 open house.

If we weren’t in a bubble it would have needed no open houses. 😃.

 

[Plum Street]

Unemployment is 3.6%.

The same people railing on immigration are the same ones in the diner complaining the service is too slow. We need more people here. Any business from small to big will tell you.

What about the drain on natural resources and environment that more people put on the country and system ? I think people can be for more people here , but then they are basically anti environment.
Can’t have it both ways

 

[theRU]

Crypto keeps crashing... Will be interesting to see which forces win out

 

[Plum Street]

Cmon @kyk1827 . You know this is a “bubble market at best”

 

[Morrischiano]

If you didn’t have a realtor how would you know what a bathroom is

Or a master bedroom?

 

[Morrischiano]

Cmon @kyk1827 . You know this is a “bubble market at best”

He’s real estate’s Baghdad Bob.

 

[rurichdog]

Or a master bedroom?

They're called "primary bedrooms" now.

 

[Knight Shift]

They're called "primary bedrooms" now.

Did Metallica rename the title of the third album too?

 

[koleszar]

Bloomberg has an article that builders are slashing prices in areas of the Sun Belt

That's why I said earlier in the thread, "now is not the time to do home renovations". I got hit real hard at the beginning of the year with a Pole Barn and farm fencing. It's only gotten worse. I said to my wife, "that's it for this year, prices right now are through the roof ". We'll see where things are at this winter. Monmouth county right now is a contractors dream.

 

[anon_0k9zlfz6lz9oy]

He’s real estate’s Baghdad Bob.

You not willing to wager on this one says all you need to know. Ive merely defined bubble as prices reverting to 2020 prices (even though true bubble definition would be prices go to 2012 prices). I will give you 5 to 1 that doesnt happen up to $10,000. In other words I’ll allow you to wager up to $2,000 to pay $10,000. This would have to happen by 2024 so that you cant keep it open forever as I want my money. You in?

 

[jtung230]

My current observations:

beach towns are slowing. Mostly due to unrealistic prices.
desirable NJ towns are still hot.

 

[NotInRHouse]

What about the drain on natural resources and environment that more people put on the country and system ? I think people can be for more people here , but then they are basically anti environment.
Can’t have it both ways

Very simple. The birthrate in the US and most developed countries is extremely low, and not close to replacement level, meaning there are not 2 people for each married couple as the marriage and birth rates wane.

If we were over replacement level you would have a point. But look at Japan and Italy...their retirement systems could turn insolvent over the next few decades, and their elderly don't have enough people to look after them.

 

[T2Kplus20]

You not willing to wager on this one says all you need to know. Ive merely defined bubble as prices reverting to 2020 prices (even though true bubble definition would be prices go to 2012 prices). I will give you 5 to 1 that doesnt happen up to $10,000. In other words I’ll allow you to wager up to $2,000 to pay $10,000. This would have to happen by 2024 so that you cant keep it open forever as I want my money. You in?

One thing kyk is right about.....the risk of ARMs is much, much lower now than compared to 2007/2008:

Here's why this housing downturn is nothing like the last one

The housing market has cooled off a bit after an incredibly hot stretch fueled by the pandemic. That doesn't mean it's about to be 2007 all over again.

www.cnbc.com

Not as many risky loans
There are currently 2.5 million adjustable-rate mortgages, or ARMs, outstanding today, or about 8% of active mortgages. That is the lowest volume on record. ARMs can be fixed, usually for terms of five, seven or 10 years.

In 2007, just before the housing market crash, there were 13.1 million ARMs, representing 36% of all mortgages. Back then, the underwriting on those types of loans was sketchy, to say the least, but new regulations following the housing crash changed the rules.

ARMs today are not only underwritten to their fully indexed interest rate, but more than 80% of today’s ARM originations also operate under a fixed rate for the first seven to 10 years.

Today, 1.4 million ARMs are currently facing higher rate resets, so given higher rates, those borrowers will have to make higher monthly payments. That is unquestionably a risk. But, in 2007, about 10 million ARMs were facing higher resets.

 

[NotInRHouse]

I have definitely had my disagreements with OP over the years, but at least relative to NJ I don't believe there is a bubble.

There may be some softening but I'm looking to buy a second home and nearly anything I pull up on Zillow is gone in days for over ask.

The other thing with the constant railing about stocks and crypto is that the average person doesn't give two craps about that in their day to day purchase decisions. Most people don't hold crypto. Something like half the country has a 401 and most use it for retirement. If you're 22-50 do you really care all that much? Our entire lifetimes stocks have fluctuated.

Lastly, many companies are still developing WFH/hybrid plans. People are still moving around and considering buying homes based on these plans.

People wishcasting 2008 need to realize that through most of this boom the rates were very low and you're not going to have the subprime issue and people upside down like they were then.