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anon_0k9zlfz6lz9oy
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Yup. Lowest supply of starter homes ever and largest demand for starter homes ever. Theyll perform best
Well both live in their own markets, one married into it the other born and raised, so they could maybe answer those questions more so than some other realtors.
But the point I was making (which I think you got) was the “other” one has become the primary residence.
Mostly City folk who left due to the changes (pandemic, social, etc.) because unlike others, they could.
My Sister who lives in the next town over has noticed the change too…NY plates (on very nice cars) in the driveway after the “under contract” sign comes down.
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My great aunt married a guy later in life who really took care of her after he passed. He set it up so she was in what one could describe as a country club nursing home with her own nurse.
As a little boy I thought they were all like that. I learned not much later I was wrong.
yeah they probably bought their house for $150,000--- not $1,000,000 like homes today.
most HNW people have FOLM, not FOMO. I think the 1st or starter home buyers rely more on financing. I’m tracking a few listings. Will report back.
First data point. 3mm listing on a great house in a great area in my town sold in a week. My neighbor’s house, stater home but 7 figures had an open house last weekend and traffic was bad.
I agree with this. I can't see the higher end outperforming unless prices come down a lot. If we have a high number of renters, you would think they would buy entry level to start, but could see mid level if prices come way down.
True but my income was also not near as good
I do agree that home ownership is more difficult for new buyers now
ICYMI - In case you missed it
HNW - high net worth
FOLM - Fear of losing money
FOMO - Fear of Missing out
Thanks. Not an acronym genius.
That said, @jtung230 's post makes even less sense with the translations.
This is a big problem. The house my wife and I want, we met the owners a couple of years ago, the wife is a Realtor. They were selling for $1.1 but the condo they hoped to purchase, fell through. So, they took their house off the market. We have gotten to know them well and they know that when they are ready, contact us first. The problem, is now finding a house or condo down in Florida, where they want to retire, that is not more over market value then they can sell their current home.
They would end up with 2-3x their monthly cost just as they go into retirement
"most HNW people have FOLM, not FOMO."
You have data to support that statement? And are fear of losing money and fear of missing out mutually exclusive? Maybe something was lost in the context of the discussion.
Since you didn’t get the acronyms, I’ll put it in context. FOMO is associated with Meme stocks and crypto. All very speculative investments. So, HNW people don’t chase that type of investments because they are more careful with their Investments or have people that manage their money. That’s what I mean by FOLM.
Thanks for the answers, but this thread was about real estate. Not sure of what meme stocks and crypto have to do with real estate? I don't think it's me- I think you are not really articulating what you want to say and how it relates to real estate. Not being critical, was just trying to figure out what you were saying. It's great you are up on all sorts of acronyms in your field of endeavor. Many of us could do this in our area of expertise and look like smarty pants.
Not sure why you are giving him that feedback. His response was to a very particular question around low end or high end homes retaining value better.
I do think he was incorrect in the assessment as some newly HNW individuals (part of the contingent driving prices higher) were just smoked in equity and crypto.
Theres less HNWI today than 6 months ago.
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I was replying to a thread about why high end vs beginner homes.
I guess I should clarify that HNW pre meme stocks and crypto. Not people that are HNW because of crypto and meme.
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anon_0k9zlfz6lz9oy
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Powell clearly has a bullseye on housing. Will be interesting to see what he meant by this. Fundamentals are so strong but if he truly is dead set on getting home prices to drop, the fed certainly has the power to do so
Powell: ...
Sounds like house prices will come down when interest rates are high enough (6-8%) then when the interest rate can come down after we’re in a recession, those buyers can refinance and make a killing like the prior generation.
Investors are ruining the market, when we bought our house nearly 30% of all home sales were to investors and what not.Disturbing trend that individual investors are purchasing large chunks of farmland. Bill Gates is most disturbing.
Also disturbing that investors are purchasing large chunks of housing. 18.4% in the fourth quarter of 2021 was purchased by investors.
Subprime mortgages and deregulation f'd regular people over in the last crash. Now investors and the elite are finding another way to f over regular people.
Bill Gates owns a lot of American farmland, but not the majority
As Elon Musk’s bid to purchase Twitter has grabbed headlines in recent days, some prominent voices have taken to social media to claim that some other significant acquisitions by deep-pocketed individuals and corporations have largely flown under the radar.apnews.com
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anon_0k9zlfz6lz9oy
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Im in the prices leveling out camp as most know. I dont see nationwide average price declines yoy as long as rates stay below 6%. If rates get over 7% you could see minor declines nationwide, nothing of significance though
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anon_0k9zlfz6lz9oy
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Nationwide number is about 18%, large majority of which are mom and pop landlords. Institutional/wall street less than 2% of that 18%. Very very small amount and not much higher than usual on the wall street side
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?
Sticking to your guns. Probably should level set on what definitions are of the bubble bursting.
I'm thinking we drop 20-25%
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That’s nuts, I locked a 4.8% rate june 1st. Literally went under contract the last day I’d be able to get at sub 5% rate. I wonder when the next time we get under 5% will be.Well this is one way to let air out of a balloon;
30-year mortgage rate surges to 6.28%, up from 5.5% just a week ago
The average rate on the popular 30-year fixed mortgage hit 6.28% Tuesday, according to Mortgage News Daily.www.cnbc.com
I'm looking at my 2.375 rate and it's probably the only time I ever timed the (near) bottom of something
I really wish people wouldn’t toss around obscure acronyms without explaining what they mean. Everyone knows FOMO but how many people read that post about FOLM and thought WTF? Lol
Real estate is cooling off. I have never understood taking charts and studies as gospel. Give me a boots on the ground view any day of the week over someone sitting in the office playing on a computer with charts.
I talk to my own realtors in my office, my own anecdotal experience from my current listings, other realtors etc. It's a 180 from 3 months ago. It needs to happen, the environment the last 2 years was beyond ridiculous. I hope to see houses actually sit on the market and maybe go for 95% of list price instead of 105% with no contingencies from an FHA buyer.
A lot of first time home buyers got the wool pulled over their eyes by their realtors looking to make a commission the last 2 years. I saw it a lot, especially in the hispanic community by hispanic realtors. Messed up stuff.
I talk to my own realtors in my office, my own anecdotal experience from my current listings, other realtors etc. It's a 180 from 3 months ago. It needs to happen, the environment the last 2 years was beyond ridiculous. I hope to see houses actually sit on the market and maybe go for 95% of list price instead of 105% with no contingencies from an FHA buyer.
A lot of first time home buyers got the wool pulled over their eyes by their realtors looking to make a commission the last 2 years. I saw it a lot, especially in the hispanic community by hispanic realtors. Messed up stuff.
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anon_0k9zlfz6lz9oy
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Yeah I am curious what yourself and those itt define as a bubble. Technical definition is prices drop to where they begun at the run up which would be 2012 prices. Im setting my level at march 2020 prices because thats more fair. Even so, i cant come up with a scenario where they lose 2 years of price gains. Wed be talking about median home sale prices dropping About 30% in that case, cant see it happening.
historically 30 year fixed rate mortgages are 175bps above the 10 year treasury so making the case for 7% mortgages means making the case for 10 year treasuries at around 5.25%, I could be wrong but that just seems incredibly high. And at 7% with duration i would see prices fall imo, but not by much, probably 5% or so
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anon_0k9zlfz6lz9oy
Guest
Definitely cooling off, i started the video by saying that. Cooling off doesnt mean prices going backward though. 20% yoy appreciation isnt healthy nor sustainable. Were headed down to normal yoy appreciation levels of 0-4%, largely dependent upon rates. My listings still getting bidding wars and going $100K+ over ask in the past couple weeks but definitely seeing less offers but less offers is gonna be normal in a normal market
I guess I’m young and cool like that 😀. i‘m surprised that many know FOMO but don’t know FOLM. It was created to directly counter FOMO.
Definition of a bubble is key to this discussion and definitely open to interpretation.
My view on a bubble is different…for me it’s when prices and fundamentals get out of control and are not aligned to the true value of the asset and there is a large drop afterwards.
If there’s a 10-20% drop in real estate (which is usually fairly stable) I would consider that a bubble. This could put people underwater and could take years for them to recover.
my definition is people who can afford to buy 2.5mm houses.
Kyle I watched the whole video and was impressed overall with the presentation so kudos. I especially agree with the point that we need a massive increase in immigration into the country to alleviate the blue collar labor shortage that is hampering growth in new construction and so many other industries. Be careful trying to project where interest rates are going. Many expert investors are currently looking foolish based on bad bets on rates (e.g., MBS holders are getting absolutely destroyed).
Question for you - what is the advantage in a passive investor investing in one of your apartment deals relative to an apartment REIT like Avalon Bay or CPT?
How much of the inflation is due to cutting off the illegal immigrants the last five years? It almost seems like everyone is being paid at least $16-23 a hour now. We also have cut off legal immigration severely. It’s only going to be worse with all the boomers retiring. My sister was planning to retire this year but her company asked her to work as a contractor PT. Her current rate is triple her old rate and is close to $300k full time. Companies have been slimming down for so long that when one valuable employee want to leave, the company is really hurting. A friend told his company that he working from Naples( brought the house 2 years ago) or he’s retiring and the company couldn’t do anything about it.
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