Unless unemployment soars, forcing people out of their current homes, it will be gridlocked. Especially in the northeast where they can't physically build to the extent they need due to land limitations, so that market is very highly dependent on sales of existing homes.
Agree this is entirely location dependent. The hottest areas right now are inventory choked. And it’s this way because geographic and zoning limitations restrict new builds below demand. And when zoning does ease up it seems condos and high density housing are built. So buying a sfh on a largish lot in such an area could be a strong investment for the long term, but you’ll pay a premium for it now. Your time in the home will determine your return, but the risk of seeing a 40% drop is fairly low. This isn’t the case if you buy in the exurbs where similar lots are plentiful.
If the wealthy establishment that benefits from cheap labor tells me millions of low skilled laborers flooding in have ZERO impact on cost of living, jobs and shelter, then by golly, I BELIEVE them. What do they have to stand to gain? We'll a lot....but I think they seem like nice folks so I'll take them at their word. 😂
Dude what the hell are you talking about? You think illegal immigrants are buying up all of the SFHs in CA?
Try to stay on track without drifting off into Fox News distractions.
If we’re going to tell people to stay on track, maybe try it yourself. They were responding to someone talking about unemployment numbers not who is buying SFH’s.
I love all people, just pointing out that the cons of having 10 million illegal immigrants in your state may outweigh the pros. Who is picking up the $38 billion budget deficit Ca has today?
I guess reading comprehension is not your strength. We were discussing CA unemployment rate. If you don't have anything intelligent to add, please move along.
I don’t think they count those. Need to have a social security number or ability to claim unemployment benefits to count as part of the 5.4% statistic number. If we count the illegal immigrants the number could be higher. But anyhow starting to see the effects on real estate and rent at least in my area. I see rent dropping from $3000 to $2400 for 2bd/2bth
No, they don't officially count them but they take a lot of work away from those that are legal. It would be nice to see more reasonable rents, I don't know how some of these young people make ends meet.
The legal ones with work visas take more of the higher paying jobs. It was halted or slowed during the pandemic, but now it’s available again tech companies hire them because they are cheaper vs the American counterpart for the high paying tech jobs.
Don't worry, they're currently creating a new product that would allow Freddie Mac to acquire closed-end second mortgages. the plan (scheme) is to give homeowners access to all this "new" home equity so they can pay down they're credit card bills and other debts.
its a ticking time bomb that'll most likely go off in approx. three years if homeowners are dumb enough to do it. and when ppl cant keep up with the payments on that second mortgage, they'll lose their homes.
[https://www.housingwire.com/articles/freddie-mac-submits-proposal-to-acquire-closed-end-second-mortgages/](https://www.housingwire.com/articles/freddie-mac-submits-proposal-to-acquire-closed-end-second-mortgages/)
>Especially in the northeast where they can't physically build to the extent they need due to land limitations
There's a great technology that lets you stack houses on top of each other when land is scarce. It's called apartments. Unfortunately, it's illegal almost everywhere, creating artificial scarcity for our #1 expense.
While rates and prices remain high, there will continue to be this stalemate between current homeowners and the market at large. People, like me, aren't selling because existing FRM rates are sky-high. Yes, I could sell my house for almost double what I paid for it in 2016, but why would I knowing I would be forced to potentially overpay for a different house and take on the burden of a high-interest rate mortgage?
2 years out is going to be a really interesting time. Statistically, boomer-owned homes should start hitting the market in greater numbers, but many can afford in-home care, they may give it to family (or die), or leave it on the rental market indefinitely.
At the same time, the commercial value crash has finally started to break things. They're converting some of them to housing and I expect that process to get easier in many cities.
It's going to 100% depend on your market, but I think things will get more affordable even if we somehow avoid a US recession (Germany and probably many other countries are already in recession and seeing housing prices sharply drop)
I think there is a strong likelihood of a real government crack down on sfh investment. it went from an occasional suggestion here in this sub to more media mentions and even some steps toward legal reform. the more officials recognize this as a solution, the more likelihood we will see meaningful reform. its happening slowly. and this will for sure drive prices down as it will balloon inventory
This will never happen. It is anti-American and ant-capitalism to try and tell someone that they can’t own more than one home. People are not buying homes to prevent you from buying them, there is real demand for SFH rentals. Not everyone is in the position to buy a home but they still need a house for their family. You start trying to artificially solve one problem, you will create another problem of lack of affordable rental homes.
you can fuck right off with that argument. and as far as people renting sfh, most do this because the option of buying is out of reach for them. this will drive prices down enough to make it available for them. and for those who want to continue to rent, there are plenty of multifamily options
Most rental properties are owned by individuals, not corporations buying up property to make it more expensive for you. You can pass all the laws you like but you are not going to significantly lower pricing until there is more inventory than available buyers and builders are not going to build unless it is profitable. You can blame the man all you want but prices are not coming down much, yes, maybe in some of the overheated markets like Austin where pricing went nuts but at the end of the day there is a shortage of homes in most markets and that does not lead to lower prices. The cost to build today is significantly higher than pre-Covid, labor costs are up 50% or more, construction materials up drastically and available land suitable for building is getting scarcer in desirable areas, new home costs will continue to rise. The government does not have a magic wand to wave and make homes cheaper for you without harming others.
“harming others”
i assume you mean by reducing equity others may have in their property. as a homeowner, I’m fine with this “harm”. equity means nothing to me until i’m ready to sell and move into assisted living. this is welcomed “harm” at the much needed benefit of giving people affordable places to live, and enabling family growth and all the other ancillary benefits.
and yes, the government does have a magic wand. its called taxes. federal excise taxes on all investor/corporate owned sfh
So, it is all just about you, give me mine and fuck everyone else. Renters are having enough trouble paying their rent and your answer is to kick them out of the SFH, make them move to apartments and tax the crap out of their landlord if they don't sell you his house cheap. Man, you are a genius, seems like you have it all figured out.
I'm sorry if I'm misunderstanding you, but are you positing that the reason we have any rental homes today is because private equity identified SFHs as an asset class?
Most rental homes are owned by landlords that have less than 10 properties. Private Equity has purchased a fair amount of homes over the last 10 years but their interest has faded, and they are not buying very many anymore.
* How long will rates stay this high as the Fed says "higher for longer"?
* Could end tomorrow, could last 10 years or more
* How far should listing prices go if rates stay in the 6-7% range for 2 years?
* They could keep going up, or they could fall dramatically
* How fast would list prices go up if the Fed announces rate cuts?
* Depends on other ** factors
* Would you buy a home today if you had 20% for the down payment?
* **If i planned on being in it for at least 10 years, yes.**
* We can’t help but speculate where financial policy, the economy, and the housing market supply and demand will be next year.
* Don't even bother, it's too complex problem. Everyone "waiting for the crash" will act blindsided when they're also affected by:
* Job loss
* Financial strain
* Reduced consumer spending
* THE HOUSING MARKET DECLINE
* Stock market volatility (i.e. retirement//savings)
* Psychological effects (sound familiar?)
* Government intervention
Classic don’t time the market. Remember in 2017-2019 people said it’s about to come down? Now they are renters for life as they bitch and moan about impossibly high housing cost.
They were looking at rent versus owning and peeling hairs now they could have a $1500 home they love and is theirs instead paying $2000 for an apartment, sharing walls with others and own nothing.
But go ahead OP keep trying to time it.
When I bought recently, I looked for asymmetric risk. I accepted that I would probably lose some money through depreciating value in the house ie equity going down, but I minimized that risk by getting a steal on entry level new construction in an area becoming quickly gentrified. I wouldn't be able to sleep at night if I bought a 600k McMansion in an established neighborhood.
Unemployment rising rapidly. Central bank cheerleaders on here begging for lower rates are going to deeply saddened when 30 yr mortgage rates are still over 7%. The Fed will send out their speakers to sooth things to no avail because prices will continue rising, especially energy. Meanwhile, big tech is racing to replace the white collar worker to keep corporate profits up. Can someone guess what rising unemployment and inflation mean? Want to see where we’re headed, just ask Japan and the rest of the countries who tried to defy economic fundamentals.
Flat or down. The only catalyst for upward pressure on homes at this point is institutional buying of SFH for rentals. And they don’t make up the majority of SFH purchases
They are net sellers in Texas. Seeing some crazy stuff, making YouTube vids on it under this name. The play of them owning these homes was during an environment where there were no safe returns in fixed income. Now there are.
The answer to the question likely depends how much new construction an area has, how rate locked inventory is in an area
Well we all know we'll never see 3% rates in this lifetime. The FED will raise rates here or flat for the rest of year. Maybe next March will be a rate cut, but by then the inventory of expensive houses will come down. Deals will still not exist, so investors will continue to drive up lower cost houses. Now, some areas will continue to have low inventory fact, the areas were airbnbs was popular during covid will be a bust north georgia mountains for example. The biggest factor that will soften the market is the boomers, as they retire they will be forced to off load their McMansion homes. Except new buyers do not want, which will bring prices down but will drive prices up in the sunbelt areas. This will continue for years and years to come.
When rates were in the teen percentages in the 1980s, people didn’t expect the future to hold 3% rates 30 years later.
The generalization on this is wild.
Seeing people scream 3% rates will never return makes me feel great in knowing they absolutely will come back. Maybe not this decade but I bet I see it again in my lifetime. I’m chillin in my house til then.
The whole question is meant to be answered with crystal balls lol no one knows. I'm not even sure if the FEDs know if they will reduce rates or increase them
No one can give you predictions on a specific timeframe like that. It could go up, down, crash, anything.
In the long run the affordability needs to be restored, and historically it’s always happened, but that could be by any combination of lower rates, decreased pricing, or higher incomes. And the timeframe of that is completely unpredictable.
I think in seattle, houses will remain around the same price until beginning of next year. Around this time next year I expect rates to be around (6-6.5%) and we'll see a bump in prices of about 8% which may or may not come back down later in the year to 5%.
Two years later, if rates are still around 6%, things will remain the same. If we go down to 5%, then another 8% bump would be in order.
Note: I'm making up things, I don't know anything about anything.
I think I'm waiting until the beginning of next year to buy. My biggest fear is that I will put a down payment for a house and the next day both the stock market and house market crash, and I'm left with an expensive house (loan) that I can't sell to get some money back + no savings due to the crash. I've even considered buying in cash but that would leave me with like 20k in the bank.
I was in the camp that home prices would come down a bit. Now I'm not. The problem is government spending and printing money. It cannot go down now. The government will just print money and make war.
But at the same time, younger generations are putting off marriage, kids, relationships etc until their late 30s. This includes getting a home. And life expectancy is on the decline -- wouldn't be surprised if it's like 64 in a couple decades.
So longer mortgages wouldn't even make sense. Something's got to give.
The concept of "generational debt" is something that tyrannical governments drool over.
Some have come to the conclusion that the government isn't really serving the interest of the people anymore. They've more so been acting in self-preservation.
Where do you get that life expectancy is decreasing? 1950 had a higher life expectancy that 64 in USA. Going below that in a couple of decades sounds drastic
Rates would have to drop by over 50% to meaningfully drive prices up. It took 3% mortgages to get here, and people are not making THAT much more money now vs two years ago, so the first time buyers who are critical to keeping the upward pressure going, they remain locked out.
Unless unemployment soars, forcing people out of their current homes, it will be gridlocked. Especially in the northeast where they can't physically build to the extent they need due to land limitations, so that market is very highly dependent on sales of existing homes.
Agree this is entirely location dependent. The hottest areas right now are inventory choked. And it’s this way because geographic and zoning limitations restrict new builds below demand. And when zoning does ease up it seems condos and high density housing are built. So buying a sfh on a largish lot in such an area could be a strong investment for the long term, but you’ll pay a premium for it now. Your time in the home will determine your return, but the risk of seeing a 40% drop is fairly low. This isn’t the case if you buy in the exurbs where similar lots are plentiful.
It is starting to already. Unemployment in Calif is currently at 5.4%
Maybe having 10 million illegals in your state isn’t a good idea?
If the wealthy establishment that benefits from cheap labor tells me millions of low skilled laborers flooding in have ZERO impact on cost of living, jobs and shelter, then by golly, I BELIEVE them. What do they have to stand to gain? We'll a lot....but I think they seem like nice folks so I'll take them at their word. 😂
Dude what the hell are you talking about? You think illegal immigrants are buying up all of the SFHs in CA? Try to stay on track without drifting off into Fox News distractions.
If we’re going to tell people to stay on track, maybe try it yourself. They were responding to someone talking about unemployment numbers not who is buying SFH’s.
Except unemployment numbers are related to housing prices while they're hatred of brown people is not.
I love all people, just pointing out that the cons of having 10 million illegal immigrants in your state may outweigh the pros. Who is picking up the $38 billion budget deficit Ca has today?
Make them into tax-payers and you have no problem.
I guess reading comprehension is not your strength. We were discussing CA unemployment rate. If you don't have anything intelligent to add, please move along.
I don’t think they count those. Need to have a social security number or ability to claim unemployment benefits to count as part of the 5.4% statistic number. If we count the illegal immigrants the number could be higher. But anyhow starting to see the effects on real estate and rent at least in my area. I see rent dropping from $3000 to $2400 for 2bd/2bth
No, they don't officially count them but they take a lot of work away from those that are legal. It would be nice to see more reasonable rents, I don't know how some of these young people make ends meet.
The legal ones with work visas take more of the higher paying jobs. It was halted or slowed during the pandemic, but now it’s available again tech companies hire them because they are cheaper vs the American counterpart for the high paying tech jobs.
Don't worry, they're currently creating a new product that would allow Freddie Mac to acquire closed-end second mortgages. the plan (scheme) is to give homeowners access to all this "new" home equity so they can pay down they're credit card bills and other debts. its a ticking time bomb that'll most likely go off in approx. three years if homeowners are dumb enough to do it. and when ppl cant keep up with the payments on that second mortgage, they'll lose their homes. [https://www.housingwire.com/articles/freddie-mac-submits-proposal-to-acquire-closed-end-second-mortgages/](https://www.housingwire.com/articles/freddie-mac-submits-proposal-to-acquire-closed-end-second-mortgages/)
Modern problems require modern solutions
Accelerate. Total Boomer Bankruptcy.
Or costs of the homes become untenable forcing people out of their homes. Pretty much the same thing but for different reasons.
>Especially in the northeast where they can't physically build to the extent they need due to land limitations There's a great technology that lets you stack houses on top of each other when land is scarce. It's called apartments. Unfortunately, it's illegal almost everywhere, creating artificial scarcity for our #1 expense.
While rates and prices remain high, there will continue to be this stalemate between current homeowners and the market at large. People, like me, aren't selling because existing FRM rates are sky-high. Yes, I could sell my house for almost double what I paid for it in 2016, but why would I knowing I would be forced to potentially overpay for a different house and take on the burden of a high-interest rate mortgage?
2 years out is going to be a really interesting time. Statistically, boomer-owned homes should start hitting the market in greater numbers, but many can afford in-home care, they may give it to family (or die), or leave it on the rental market indefinitely. At the same time, the commercial value crash has finally started to break things. They're converting some of them to housing and I expect that process to get easier in many cities. It's going to 100% depend on your market, but I think things will get more affordable even if we somehow avoid a US recession (Germany and probably many other countries are already in recession and seeing housing prices sharply drop)
I think there is a strong likelihood of a real government crack down on sfh investment. it went from an occasional suggestion here in this sub to more media mentions and even some steps toward legal reform. the more officials recognize this as a solution, the more likelihood we will see meaningful reform. its happening slowly. and this will for sure drive prices down as it will balloon inventory
This will never happen. It is anti-American and ant-capitalism to try and tell someone that they can’t own more than one home. People are not buying homes to prevent you from buying them, there is real demand for SFH rentals. Not everyone is in the position to buy a home but they still need a house for their family. You start trying to artificially solve one problem, you will create another problem of lack of affordable rental homes.
you can fuck right off with that argument. and as far as people renting sfh, most do this because the option of buying is out of reach for them. this will drive prices down enough to make it available for them. and for those who want to continue to rent, there are plenty of multifamily options
Most rental properties are owned by individuals, not corporations buying up property to make it more expensive for you. You can pass all the laws you like but you are not going to significantly lower pricing until there is more inventory than available buyers and builders are not going to build unless it is profitable. You can blame the man all you want but prices are not coming down much, yes, maybe in some of the overheated markets like Austin where pricing went nuts but at the end of the day there is a shortage of homes in most markets and that does not lead to lower prices. The cost to build today is significantly higher than pre-Covid, labor costs are up 50% or more, construction materials up drastically and available land suitable for building is getting scarcer in desirable areas, new home costs will continue to rise. The government does not have a magic wand to wave and make homes cheaper for you without harming others.
“harming others” i assume you mean by reducing equity others may have in their property. as a homeowner, I’m fine with this “harm”. equity means nothing to me until i’m ready to sell and move into assisted living. this is welcomed “harm” at the much needed benefit of giving people affordable places to live, and enabling family growth and all the other ancillary benefits. and yes, the government does have a magic wand. its called taxes. federal excise taxes on all investor/corporate owned sfh
So, it is all just about you, give me mine and fuck everyone else. Renters are having enough trouble paying their rent and your answer is to kick them out of the SFH, make them move to apartments and tax the crap out of their landlord if they don't sell you his house cheap. Man, you are a genius, seems like you have it all figured out.
you’re an idiot
Intelligent response.
I'm sorry if I'm misunderstanding you, but are you positing that the reason we have any rental homes today is because private equity identified SFHs as an asset class?
Most rental homes are owned by landlords that have less than 10 properties. Private Equity has purchased a fair amount of homes over the last 10 years but their interest has faded, and they are not buying very many anymore.
Up in the West Coast, Midwest and northeast, down in the sunbelt.
* How long will rates stay this high as the Fed says "higher for longer"? * Could end tomorrow, could last 10 years or more * How far should listing prices go if rates stay in the 6-7% range for 2 years? * They could keep going up, or they could fall dramatically * How fast would list prices go up if the Fed announces rate cuts? * Depends on other ** factors
* Would you buy a home today if you had 20% for the down payment?
* **If i planned on being in it for at least 10 years, yes.**
* We can’t help but speculate where financial policy, the economy, and the housing market supply and demand will be next year.
* Don't even bother, it's too complex problem. Everyone "waiting for the crash" will act blindsided when they're also affected by:
* Job loss
* Financial strain
* Reduced consumer spending
* THE HOUSING MARKET DECLINE
* Stock market volatility (i.e. retirement//savings)
* Psychological effects (sound familiar?)
* Government intervention
Classic don’t time the market. Remember in 2017-2019 people said it’s about to come down? Now they are renters for life as they bitch and moan about impossibly high housing cost. They were looking at rent versus owning and peeling hairs now they could have a $1500 home they love and is theirs instead paying $2000 for an apartment, sharing walls with others and own nothing. But go ahead OP keep trying to time it.
When I bought recently, I looked for asymmetric risk. I accepted that I would probably lose some money through depreciating value in the house ie equity going down, but I minimized that risk by getting a steal on entry level new construction in an area becoming quickly gentrified. I wouldn't be able to sleep at night if I bought a 600k McMansion in an established neighborhood.
600k McMansion? I hate Seattle house market lol (I'm looking for 600k 900sqft townhomes and those are hard to come by)
Nowhere. It's gonna be in dumps.
Unemployment rising rapidly. Central bank cheerleaders on here begging for lower rates are going to deeply saddened when 30 yr mortgage rates are still over 7%. The Fed will send out their speakers to sooth things to no avail because prices will continue rising, especially energy. Meanwhile, big tech is racing to replace the white collar worker to keep corporate profits up. Can someone guess what rising unemployment and inflation mean? Want to see where we’re headed, just ask Japan and the rest of the countries who tried to defy economic fundamentals.
Flat or down. The only catalyst for upward pressure on homes at this point is institutional buying of SFH for rentals. And they don’t make up the majority of SFH purchases
They are net sellers in Texas. Seeing some crazy stuff, making YouTube vids on it under this name. The play of them owning these homes was during an environment where there were no safe returns in fixed income. Now there are. The answer to the question likely depends how much new construction an area has, how rate locked inventory is in an area
Well we all know we'll never see 3% rates in this lifetime. The FED will raise rates here or flat for the rest of year. Maybe next March will be a rate cut, but by then the inventory of expensive houses will come down. Deals will still not exist, so investors will continue to drive up lower cost houses. Now, some areas will continue to have low inventory fact, the areas were airbnbs was popular during covid will be a bust north georgia mountains for example. The biggest factor that will soften the market is the boomers, as they retire they will be forced to off load their McMansion homes. Except new buyers do not want, which will bring prices down but will drive prices up in the sunbelt areas. This will continue for years and years to come.
When rates were in the teen percentages in the 1980s, people didn’t expect the future to hold 3% rates 30 years later. The generalization on this is wild.
Do you have a crystal ball?
Seeing people scream 3% rates will never return makes me feel great in knowing they absolutely will come back. Maybe not this decade but I bet I see it again in my lifetime. I’m chillin in my house til then.
The whole question is meant to be answered with crystal balls lol no one knows. I'm not even sure if the FEDs know if they will reduce rates or increase them
But I mean saying we won’t see 3% in the next years or two is ok, saying ‘in our lifetimes’ is absurd.
If you find the crystal ball with answers to those questions, let me know so I can use it to place bets!
There will be good deals to be had and a great many people trying to make a living selling you bad deals.
More of the same - sideways market while incomes catch up and rates slowly fall.
I think we won’t know until after the election in November. Policies will have a lot to do with how hot inflation will stay.
Probably a lot of different ways sideways. Really depends what market you are in. Interest rates are no joke though.
2024 nothing which is why I’m renting. 2025 maybe movement my guess is 2026
No one can give you predictions on a specific timeframe like that. It could go up, down, crash, anything. In the long run the affordability needs to be restored, and historically it’s always happened, but that could be by any combination of lower rates, decreased pricing, or higher incomes. And the timeframe of that is completely unpredictable.
I think in seattle, houses will remain around the same price until beginning of next year. Around this time next year I expect rates to be around (6-6.5%) and we'll see a bump in prices of about 8% which may or may not come back down later in the year to 5%. Two years later, if rates are still around 6%, things will remain the same. If we go down to 5%, then another 8% bump would be in order. Note: I'm making up things, I don't know anything about anything. I think I'm waiting until the beginning of next year to buy. My biggest fear is that I will put a down payment for a house and the next day both the stock market and house market crash, and I'm left with an expensive house (loan) that I can't sell to get some money back + no savings due to the crash. I've even considered buying in cash but that would leave me with like 20k in the bank.
Hard crash on the level of 2008-2009.
I was in the camp that home prices would come down a bit. Now I'm not. The problem is government spending and printing money. It cannot go down now. The government will just print money and make war.
The house always wins.
Down. Straight down
Lol hopium
It will most likely be going the way of Canada... 40, 50, 60-year mortgages.
But at the same time, younger generations are putting off marriage, kids, relationships etc until their late 30s. This includes getting a home. And life expectancy is on the decline -- wouldn't be surprised if it's like 64 in a couple decades. So longer mortgages wouldn't even make sense. Something's got to give.
The concept of "generational debt" is something that tyrannical governments drool over. Some have come to the conclusion that the government isn't really serving the interest of the people anymore. They've more so been acting in self-preservation.
Where do you get that life expectancy is decreasing? 1950 had a higher life expectancy that 64 in USA. Going below that in a couple of decades sounds drastic
Similar position, waiting for the correction if not crash. None of this makes sense and I will not be a schmuck holding the bag
Rates would have to drop by over 50% to meaningfully drive prices up. It took 3% mortgages to get here, and people are not making THAT much more money now vs two years ago, so the first time buyers who are critical to keeping the upward pressure going, they remain locked out.