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

[Knight Shift]

The articles I saw indicated the law was on his side

Amazon is taking the stance that the Covid rules mandating things like WFH nullified their obligation but there is nothing in the law that provides an exception

Some people in the comments feel he is a front for Amazon to force people back to the office because he is fighting for an expense which was much less than his savings

The employee is an idiot, and he/she will be dismissed in due course. Some people have no common sense or a sense of self-awareness. The case is unique to California based on California law. No wonder companies are leaving California in droves.


"Employees are currently coming out ahead.
While I believe that the engineer will win--California law is pretty straightforward--he's not considering how much money he's saved by not going to work. Pre-corona Californians spent an average of almost 30 minutes commuting one way.
Even before gas prices began to skyrocket, people probably spent far more on gas than on they were spending on increased electricity and internet costs. As of June 9, 2022, Californians are paying an average of $6.403 per gallon of gas. The plaintiff argues that he's owed expenses between $50 and $100 per month. In pre-pandemic 2019, the average American used 34.5 gallons of gas per month. If working from home cuts gas usage in half, the engineer still comes out ahead. Not to mention wear and tear on the car and the cost of pants suitable for the office."

Amazon Engineer Sues for Work From Home Costs. Employees May Not Like it if He Wins

California does, indeed, require employers to pay all business costs, but do they need to pay for your increased electricity use?

www.inc.com

 

[AreYouNUTS]

Rentals gonna keep booming imo. Too many people need housing and we are wayyy undersupplied. And when rates take a bite out of buyers purchasing power and they cant get anything they rent. All time low supply + all time high demand posted in q1 2022. Its best to be on the owner side here

As a fellow Realtor in the same area I can attest, WITHOUT QUESTION, that the rental market is still flying and won't stop anytime soon. It's astonishing, actually, in Hoboken and JC.

 

[koleszar]

The articles I saw indicated the law was on his side

Amazon is taking the stance that the Covid rules mandating things like WFH nullified their obligation but there is nothing in the law that provides an exception

Some people in the comments feel he is a front for Amazon to force people back to the office because he is fighting for an expense which was much less than his savings

I must of read the same article because they did say the law is on his side. It's always one guy who fvcks it up for the rest. How much does this idiot think he's really going to get for internet and electricity? $1200 bucks. Then he'll have to spend four times that on gas driving to the office.

 

[Knight Shift]

I must of read the same article because they did say the law is on his side. It's always one guy who fvcks it up for the rest. How much does this idiot think he's really going tot get for internet and electricity? $1200 bucks. Then he'll have to spend three times that just driving to the office.

Limited to California law. You know, the place that makes running a business next to impossible. Make NJ look like paradise.

 

[tom1944]

The employee is an idiot, and he/she will be dismissed in due course. Some people have no common sense or a sense of self-awareness. The case is unique to California based on California law. No wonder companies are leaving California in droves.


"Employees are currently coming out ahead.
While I believe that the engineer will win--California law is pretty straightforward--he's not considering how much money he's saved by not going to work. Pre-corona Californians spent an average of almost 30 minutes commuting one way.
Even before gas prices began to skyrocket, people probably spent far more on gas than on they were spending on increased electricity and internet costs. As of June 9, 2022, Californians are paying an average of $6.403 per gallon of gas. The plaintiff argues that he's owed expenses between $50 and $100 per month. In pre-pandemic 2019, the average American used 34.5 gallons of gas per month. If working from home cuts gas usage in half, the engineer still comes out ahead. Not to mention wear and tear on the car and the cost of pants suitable for the office."

Amazon Engineer Sues for Work From Home Costs. Employees May Not Like it if He Wins

California does, indeed, require employers to pay all business costs, but do they need to pay for your increased electricity use?

www.inc.com

Unless he was a shill for Amazon

 

[Knight Shift]

Unless he was a shill for Amazon

Possibly. There is a fair balance to the WFH paradigm. Come in 2-3 days per week. Offer employees flexibility to work from home, and they will reward you with extra effort. There are bad apples in every bunch that spoil it for others.

 

[anon_0k9zlfz6lz9oy]

Good point. In our neighborhood in Sedona, AZ, homes that were selling for $500-600K 2 years ago are now above $1M. The house we sold for $615K in a different neighborhood in November 2020 would now sell for over $800K. These prices will not hold up.

Was just there. You live there year round? Beautiful place

 

[anon_0k9zlfz6lz9oy]

Doing renovations to a kitchen. Was looking at builders grade cabinets in March and when I went to purchase them in early May the price increased almost 20% in just less than 2 months.

Which is why as you can imagine, paired with rise in labor costs, builders either A) have to slow building which crushes supply when were already short or B ) keep prices high. This is simply really a supply issue we have. Thats really the biggest issue we have and the main reason prices are elevated. Big supply/demand imbalance

 

[anon_0k9zlfz6lz9oy]

As a fellow Realtor in the same area I can attest, WITHOUT QUESTION, that the rental market is still flying and won't stop anytime soon. It's astonishing, actually, in Hoboken and JC.

The rivington in hoboken raised rents from 3200 to 4400 for RENEWALS and no one blinked. They bitched and moaned but renewed, their alternatives were higher. Park and garden 738 sq ft one beds $4600/month now

 

[yesrutgers01]

The rivington in hoboken raised rents from 3200 to 4400 for RENEWALS and no one blinked. They bitched and moaned but renewed, their alternatives were higher. Park and garden 738 sq ft one beds $4600/month now

The wife and I almost went for a 3 BR 1600 SF apartment in WNY on the water. Rent was crazy back in late 2019 at about $6k plus and decided on renting a home in Franklin lakes instead. 4 BR 4 Bath 3200 SF for much less. We werent ready to buy yet as we were selling our house as my wife wouldn't buy with a contingency to sell as she knows that can be such a nightmare for realtors and she didn't want to do that to anyone. But we thought we would be renting for 18 months- 2 years max.
We just had to renew our lease last month and were able to get the landlord to drop her 5% increase to 2.5% increase and very happy.
If we had gone with the highrise, what a nightmare that would have been during the pandemic and now with the rising rents. I would bet the place we looked at or similar would be well over 7k now.

 

[Knight Shift]

Was just there. You live there year round? Beautiful place

No. We have a second home there. Don't think we could be there year round, especially in the summer. It's a little too quiet too. We like it here too near the beach.

 

[AreYouNUTS]

The rivington in hoboken raised rents from 3200 to 4400 for RENEWALS and no one blinked. They bitched and moaned but renewed, their alternatives were higher. Park and garden 738 sq ft one beds $4600/month now

Buildings are straight-up offering NEW lessee rates, to current tenants, and getting away with it. You're correct. Cost of Living to-date over last year is about 5.9% right now. Smart people will know they can get past the b.s. BUT most d have no clue. They gave us the "renewal" rate of $4470 on $3650. We're resigning for $4K (2BR, 2B, balcony with city views at Cast Iron).

 

[e5fdny]

An example of market insanity. Lake Como, NJ, otherwise known as South Belmar. But hey, the property backs up to a Spring Lake park (separated by a brook that overflows during heavy storms). $2M to be surrounded by bungalows.

739 22nd Avenue, Belmar, NJ 07719 | MLS #22138349 | Zillow

739 22nd Avenue, Belmar NJ, is a Single Family home that contains 1327 sq ft and was built in 1947.It contains 3 bedrooms and 2 bathrooms.This home last sold for $475,000 in March 2022. The Rent Zestimate for this Single Family is $6,604/mo, which has decreased by $423/mo in the last 30 days.

www.zillow.com

I know exactly where that is.

West of Main/3rd, near the other ball field (not pictured) and the brook thing you’re talking about.

Good luck to the builder getting their price as it doesn’t fit (IMO anyway) with the inventory on that particular street.

 

[RUskoolie]

Started a home renovation last week. Basically the whole house. Crazy expensive for everything. First thing we bought were the appliances and I thought those were expensive. Compared to the cabinets, windows and floors the appliances look like a steal. It’s nutty. Also cabinets have a 5 month lead time, windows 5/6 month lead time, and the floors we got but not in the size we wanted. That they said wait until next year. So it’s crazy but the wife wants it done and the really good crew my designer always uses was available so we had to go for it. But yeah my initial budget is shot to hell.

I'm building my first house starting next month. Thank God lumber is coming back to earth but we did about 700k in construction last year, prices are bananas. I put 2 1/4" pre-finished red oak hardwood floors in my house in March 2020 for $2.49 a sqft. UNFINISHED 2 1/4" is $5 a sqft right now.

 

[RUskoolie]

An example of market insanity. Lake Como, NJ, otherwise known as South Belmar. But hey, the property backs up to a Spring Lake park (separated by a brook that overflows during heavy storms). $2M to be surrounded by bungalows.

739 22nd Avenue, Belmar, NJ 07719 | MLS #22138349 | Zillow

739 22nd Avenue, Belmar NJ, is a Single Family home that contains 1327 sq ft and was built in 1947.It contains 3 bedrooms and 2 bathrooms.This home last sold for $475,000 in March 2022. The Rent Zestimate for this Single Family is $6,604/mo, which has decreased by $423/mo in the last 30 days.

www.zillow.com

Belmar is such a dump compared to Spring Lake. Love me some Spring Lake!

 

[Knight Shift]

Belmar is such a dump compared to Spring Lake. Love me some Spring Lake!

IDK if that is fair. The areas bounded by 11th to 18th Ave and Main St East to about B Street in Belmar are a dump.

Inlet Drive and 1st through 10th Avenues have some very nice homes. The very South end of Belmar 19th-20th AVe and East of B Street to Ocean Ave are nice too. Spring Lake beaches suck in that they don't let you bring coolers or food on the beach.

 

[e5fdny]

IDK if that is fair. The areas bounded by 11th to 18th Ave and Main St East to about B Street in Belmar are a dump.

Inlet Drive and 1st through 10th Avenues have some very nice homes. The very South end of Belmar 19th-20th AVe and East of B Street to Ocean Ave are nice too. Spring Lake beaches suck in that they don't let you bring coolers or food on the beach.

That’s why we have no birds.🙂

You can eat up top at the picnic tables at either pavilion. Or at any bench along the boardwalk.

And you’re right, last two mayors in Belmar changed a few things.

 

[Knight Shift]

That’s why we have no birds.🙂

You can eat up top at the picnic tables at either pavilion. Or at any bench along the boardwalk.

And you’re right, last two mayors in Belmar changed a few things.

The "views" are much better in Belmar too. Plus, the few times I have sat on the Spring Lake beaches, the lifeguards have tended to be just a little too aggressive with their whistles. Kind of worse than B1G referees at a RU football game.

 

[mdk01]

Buildings are straight-up offering NEW lessee rates, to current tenants, and getting away with it. You're correct. Cost of Living to-date over last year is about 5.9% right now. Smart people will know they can get past the b.s. BUT most d have no clue. They gave us the "renewal" rate of $4470 on $3650. We're resigning for $4K (2BR, 2B, balcony with city views at Cast Iron).

Wonder if the SALT limitations combined with the lack of saving up a down payment on the part of younger upscale prospective residents have put excessive pressure on the high end rental market.

 

[theRU]

So 5.1% on a 30 jumbo in CA right now.... We're in the market to upsize In the next few years. I'm hoping timing works out.

 

[Morrischiano]

As many of you know, im in real estate. And a question i keep getting bombarded with is, is this market a bubble. I did a webinar last night going over 50+ charts on why we are not and the data that backs it up. Posting here in case its of interest to anyone

View embedded media

Based on the crap you post of the C&E board leads me to take the opposite of any self-serving take you have.

 

[Knight Shift]

Based on the crap you post of the C&E board leads me to take the opposite of any self-serving take you have.

People you disagree politically may have valuable perspectives in their area of expertise. There was a time when people did not make such exclusions based on a person's politics.

 

[Morrischiano]

I'm calling it a bubble. The rising interest rates, comtinued inflation, plus I predicy a drop in consumer confidence that is coming will bring prices down. Feel free to call me out next year at this time if I am wrong,

Don't forget the 18% decline in the value of most people's investment account this year. 6 months ago you had $250,000 for a down payment on a $1,000,000 house. Now you only have $200,000 on on house that probably won't event appraise for $1,000,000.

 

[anon_0k9zlfz6lz9oy]

Don't forget the 18% decline in the value of most people's investment account this year. 6 months ago you had $250,000 for a down payment on a $1,000,000 house. Now you only have $200,000 on on house that probably won't event appraise for $1,000,000.

Very few people pull money from 401K and IRA unrealized gains to buy homes fyi

 

[ScarletDave]

This is great news. Really looking forward to the prices dropping now when the bubble bursts so I can buy a home.

 

[Knight Shift]

Well when a person says racist and bigoted things then I exclude any professional viewpoints that person might espouse.

Fair enough. I don't have access to the CE board, and I am happier for it.
IMO, his takes on hoops and Pikiell are terrible, and he recently doubled down on them. On that basis, and his age, maturity and experience, I take what he has to say with a grain of salt.

 

[Knight Shift]

Very few people pull money from 401K and IRA unrealized gains to buy homes fyi

Is there a stat on that. I know several people who regularly pull money out of their 401Ks. We never touch ours, and dollar cost averaging helps ride out market swings.

 

[Morrischiano]

Fair enough. I don't have access to the CE board, and I am happier for it.
IMO, his takes on hoops and Pikiell are terrible, and he recently doubled down on them. On that basis, and his age, maturity and experience, I take what he has to say with a grain of salt.

Same, I swore it off. The OP's posts there were reprehensible.

That being said, I listened for the first 60 seconds of his link. He must have said "you know' at least 10 times in the first minute. He needs to work on that verbal tick if he's going to present professionally. I couldn't listen to him any longer.

 

[anon_0k9zlfz6lz9oy]

Is there a stat on that. I know several people who regularly pull money out of their 401Ks. We never touch ours, and dollar cost averaging helps ride out market swings.

Less than 10%. It doesnt make sense to do so. Tax + early withdrawal penalty makes it a dumb decision https://www.cnbc.com/amp/2019/09/11...ped-a-retirement-plan-to-buy-their-house.html

 

[anon_0k9zlfz6lz9oy]

Same, I swore it off. The OP's posts there were reprehensible.

That being said, I listened for the first 60 seconds of his link. He must have said "you know' at least 10 times in the first minute. He needs to work on that verbal tick if he's going to present professionally. I couldn't listen to him any longer.

I think I'm real and fine. You're entitled to your opinion though.

 

[Knight Shift]

Less than 10%. It doesnt make sense to do so. Tax + early withdrawal penalty makes it a dumb decision https://www.cnbc.com/amp/2019/09/11...ped-a-retirement-plan-to-buy-their-house.html

Agreed, it's a case of robbing Peter to pay Paul. We never touch our 401K money, and that has served us well. We also never took (and never will) a home equity loan.

 

[anon_0k9zlfz6lz9oy]

Agreed, it's a case of robbing Peter to pay Paul. We never touch our 401K money, and that has served us well. We also never took (and never will) a home equity loan.

I must say though, I am a big advocate for always maxing out your leverage on your personal residence. Typically homes appreciate around 3% a year. So when you can pull out that stagnant equity and then place it in investment real estate at 75% LTV, historically that equity is now going to grow around 26%/year (from 1870-2015).

 

[tom1944]

I am a very conservative saver for things like a down payment

I was always all cash accumulation until I reached my down payment amount.

Retirement and college savings were in stock funds

 

[Knight Shift]

I must say though, I am a big advocate for always maxing out your leverage on your personal residence. Typically homes appreciate around 3% a year. So when you can pull out that stagnant equity and then place it in investment real estate at 75% LTV, historically that equity is now going to grow around 26%/year (from 1870-2015).

IDK about that for us. Roughing it, our home equity in our personal residence is roughly about 10% of our net worth. Throw in our vacation home, and it is about 18-20%. Loans on our rental properties are nearly paid off, to the point we will be making about 7-9% income on the equity in the two rental properties.

 

[mdk01]

Don't forget the 18% decline in the value of most people's investment account this year. 6 months ago you had $250,000 for a down payment on a $1,000,000 house. Now you only have $200,000 on on house that probably won't event appraise for $1,000,000.

And if they were planning to buy within 6 months they were foolish if they didn't have 250k in short term T-bills with the rest in the market.

 

[Morrischiano]

And if they were planning to buy within 6 months they were foolish if they didn't have 250k in short term T-bills with the rest in the market.

Those people probably lost 5%.

 

[Morrischiano]

I am a very conservative saver for things like a down payment

I was always all cash accumulation until I reached my down payment amount.

Retirement and college savings were in stock funds

Cash lost you 8% in the last year; due to inflation.

Cash lost you 40% in opportunity cost via S&P500 the previous year.

 

[yesrutgers01]

And if they were planning to buy within 6 months they were foolish if they didn't have 250k in short term T-bills with the rest in the market.

I should ask my wife but I wonder how many people are using their investments for down payment vs cash. I do know that last year, a good number of people were taking from their Robinhood accounts.
But I always separated money for house down payment from my investments

 

[anon_0k9zlfz6lz9oy]

IDK about that for us. Roughing it, our home equity in our personal residence is roughly about 10% of our net worth. Throw in our vacation home, and it is about 18-20%. Loans on our rental properties are nearly paid off, to the point we will be making about 7-9% income on the equity in the two rental properties.

Why not re-lever and buy more properties?

 

[tom1944]

Cash lost you 8% in the last year; due to inflation.

Cash lost you 40% in opportunity cost via S&P500 the previous year.

I have enough equity exposure so for items I expect to use the money in 5 years or less I keep the money in a money market fund