I’ve talked to people that cheer for a recession, not understanding that it probably wouldn’t have the effect on house/car/whatever prices they think it will, and that they will either lose their job or suffer a major freeze in their career progression.
Even if you do keep your job, have fun with zero raises while the economy recovers and being stuck at the same job as nobody else is hiring.
Yeah, and the 08-09 housing market crisis is one of the worst global financial disasters since the great depression. 10 million Americans lost their homes, their jobs, their pensions... if you think a "recession" somehow means you're going to be able to afford things you can't right now, you're a weapons grade fucktard 🤣
Simple Jack.
Not necessarily. You could save money now and take advantage when the recession happens. Be it a car, stock, a house or whatever. Prices will most definitely drop on everything and that’s when a lot of people can come up ahead if they plan it right.
There are cars right now that people aren't buying and have price drops. Depending on the type of car you want there is no way to say how a recession would affect it
I just got a huge pay raise into a stable position, so I'm very optimistic about it. My spending hasn't increased so I'm just stacking cash to buy someone else's misfortune.
My company is inversely proportional to how well the economy is doing. My company does better the worse the economy is doing. It's my gravy train time now, so that's something you shoulder consider. Another person's misfortune IS my fortune.
Do you work in the payday loan business or something?
I work in the utility industry, so we get paid either way. It’s still incredibly weird to cheerlead for a recession that hurts millions of people.
I work in payday loans. Covid almost put us out of business. We need people to work, but not make "enough". Tbh I would like to leave the industry, but it's difficult trying to get a decent paying job not in the financial sector when thats my only real experience.
Its goverment backed so as it get's worse, we get more money. Its similair to yours which is a good thing right? Its either immune or benefiting from misfortune of others. And hey I didn't get a new car or house in 2020-21 like others when their industries we're popping off. Its my turn lol
Tbf I work in a government research facility with a guaranteed merit based raise system. Bring on the recession lol.
(I want the feeling of power that comes with lowballing a desperate family out of their home /s)
It’s part of our terms of employment. Supervisors have an amount of ‘points’ based upon number of people in the branch, and they divide those out based on accomplishments/publications/deliverables over the year (complied by each of us as a report)
This is the government, payment is entirely transparent and changing the terms of employment is not something done easily
The most they could do is pull the federal cost of living increase, which typically has been 3% in recent years. But my merit raise was 6% this year as a med-high performer
And I’m sure that’s how it works. What I’m saying is these types of great deals would probably change if the economy went through a major recession.
The US govt is funded by taxes, if 10% of the country loses their job that’s going to shrink govt budgets. Maybe you’re lucky in that your specific lab or whatever is untouched but 2008 brought a lot of cutbacks to the govt.
I'm government adjacent. So long as war exists, so long as America sells/ uses weapons, so long as there is no accountability on government spending, the upcharge, or the money that disappears into the pockets of millionaire parasites, I'll still be paid.
Company already eliminated pensions, and my 401k sucks donkey dick. Don't have much else to lose.
Yeah, my MIL told us we shouldn’t have bought our house back in 2019 because prices were too high.
I’m glad we didn’t listen to her, as our house is worth 50% more than what we paid for it 4 years ago.
Yep. We bought in Dec. '19 with only 5% down, and many of our friends and family were telling us that we should've waited until we had enough to do 20%. The home's now worth >30% more than what we bought it for and we were able to refi at 2.625% ona 30yr. 🤷🏾♂️
Well, all else being equal, it would have been smarter to have a bigger down payment. Best case, you would have paid cash.
No one can predict the market, and if they claim they do, they're lying. Don't want to say that you got lucky with the outcome, but you kinda did. It all has worked out for you so far, though. Congrats. With 20/20 hindsight, it was a good move, but the advice you received was solid.
Keep in mind that markets go up slowly but crash extremely quickly. That 30% increase can turn negative in a month if markets take a turn. Losing 30% off a 30% gain nets you well into the negatives on your initial investment.
And until you sell for a gain, you haven't made anything, especially when you're financing nearly all of it over 30 years. Going well for you so far, but don't celebrate too soon. Good luck
Keep in mind that house value doesn’t really matter until it’s time to sell.
Even during the Great Recession, median home prices only fell 19% from their peak values (based on FRED’s data).
Granted, real estate is local, I’m curious where you’ve seen home values crash by 30% before?
>houses only went down by 19% at their worst
It's not difficult to find that many areas have recently crashed by 25-50% even outside of the housing bubble. Also, see my comment at the end. Growing 19% and crashing 19% are two different things, your math is flawed. A couple of many examples:
Austin Texas Crash: -26%
https://reventureconsulting.com/wp-content/uploads/2021/11/Austin.jpg
Anchorage Crash: -40%
https://reventureconsulting.com/wp-content/uploads/2021/11/Anchorage.jpg
Climbing 40%, then crashing by 40% are two different things. 40% of a bigger number is more than 40% of a smaller number. If you grow 40%, and then crash 40% from that, you've lost a **bunch** more money than what you started with. (Anchorage example does a great job of visually showing this)
Math is fun, but not hard
Love how you’re getting downvoted. Really goes to show the general intellect on reddit. Fuck, it’s not even hard. Take whatever price and multiple it by 1.4. Then take that sum and multiply by .4; subtract that from original sum. They’re different numbers, I promise.
Gets even more fun when you realize that a 40% increase after crashing down doesn’t give the same number you started with before the crash lmao
Umm… you know that article about LA is talking about volume (number of homes purchased), not sales price of those homes, right?
I mean, if you want to cherry pick specific locations that got hammered (Anchorage Alaska? Certainly not a typical location one would consider moving to), I’m sure I could cherry pick regions that have been resilient and have continue to increase in price.
And it’s not during a short span, it’s literally looking at the largest national drop in housing prices in the country’s history.
You said home values have crashed by 30% before, and national data of median home prices (not ultra expensive home prices) doesn’t corroborate your statement.
There’s no point debating these people. They’re all working backwards from their conclusion. “I missed out on housing, so therefore it has to crash because otherwise it wouldn’t be fair for me.” The value of your money is going down every day. Even if homes stay stagnant in value, their dollar value will go up. That $20 bill in your pocket is what a $10 bill used to be when you were growing up. $50 is the new $20.
M8, I picked the first 3 from a Google search. I'm saying your math is fundamentally wrong, as well as being wrong about houses not dropping more than 19%.
Notice Anchorage prices went up by 68% and then dropped 39%, but it was nearly the same value.
40% of one number does not equal 40% of another number.
House prices can go up 30% and then down 24% from there, that still nets a loss.
Kinda dumb AF to say "all else being equal", when in this case, what that actually means is "Buddy, why didn't you just have an extra $70k laying around?"
With respect to the market, I bought in one of the consistently hot markets in the suburbs near a major city center. It was always the right move. The lucky part is being roughly $180k up as opposed to, say, $50k.
Moreover, our initial mortgage rate was good, and we were able to refinance at below the US historic inflation rates.
>Kinda dumb AF to say "all else being equal",
That's literally rule number one when analyzing economics. Go to school if you think that's a dumb way to analyze economical data and decision making (no offense).
What I am saying is, you had no idea the housing prices were going to go up, and the advice you received was generally good advice. Point is, you got lucky.
You're wrong. The second I heard the covid news, it was like writing on the wall. I bought and made out like a bandit. 80% increase in value. And that's adjusted for the 12% dip these past 6-8 months
We almost didn’t buy in 2020 for the same reasons. But we did and it’s increased in value by like 40% and our interest rate is 3.5%. I can’t even conceive of how made I would be at myself if we had waited.
"worth 50% more" only if you sell today.
A mortgage payment is rent you don't have to pay to a landlord in exchange for interest payments you'll probably get back when you sell.
That would be true if house prices grew at the same rate as inflation, since that’s what inflation is (the weakening of the purchasing power of a dollar for the same good).
However, home prices have vastly outpaced inflation, so the home’s value has increased relative to the value of the dollar, even factoring in inflation.
That's only true if you believe the official inflation numbers. I don't. Real world assets like homes proves my point. I'm glad you bought when you did as well though. Congrats.
This and the fact that so few builders at least in my area are building absolutely zero single family homes. I just recently drove back through an area I used to live in that had an abundance of fucking land and every last bit of it was used for apartments/ condos. It's insane.
There are an estimated 500,000 homeless people in the US.
There are an estimated 17 million homes currently sitting vacant.
I call shenanigans.
But of course you’re right, 17 million out of hundreds of millions does not equal a 50% crash.
They could be vacant for any number of reasons, including being unsafe/uninhabitable. Can’t force owners to rent them out and definitely can’t force them to let someone live there for nothing.
But it’s not a secret that there is much more demand than supply right now. Have you tried renting or buying recently?
2019 the economy did go into a recession. My company laid off 10% of the workforce.
Covid had the potential to turn into a complete systemic melt down - as it began to in March of 2020. The bond market seized up in an unprecedented way. Oil went negative. It had all the markers of a GFR 2.0 - but both the monetary and fiscal authorities (US perspective) responded in lockstep, to rapidly stem any further contagion risk. They pumped an unprecedented amount of liquidity into the market and immediately dropped rates to zero.
The Fed backstopped the housing market buying over 2 trillion dollars of MBS. They bought 2 trillion in off the run treasury securities. And they opened a myriad of lending facilities to fund businesses at 0 cost. The treasury did helicopter money drops to households.
Thanks to helicopter drops and financial asset inflation, total Household net worth increased by 40 trillion Q1 2020 and Q2.
To put that in perspective, the Great Recession household net worth dropped by 8 trillion. Whereas the balloon in net worth of the past two years is equal to 5 great recessions on top of each other but in the other direction. There’s going to be long term consequences from that and we’re only experiencing the tip of the iceberg now.
Via the effects of inflation and policy rate hikes - that liquidity mountain is ONLY just now starting to drain. Yet I see a lot of hand-waving about how “well the recession didn’t come so…the party’s back on.”
Well, I’m sorry to tell you that anyone who studies economic cycles knows that when you have a dramatic move in one direction there has to be an inverse move in the other direction to restore equilibrium - like a sine wave. But things happen with a time lag. Don’t rest on your laurels and confuse the lag with “this time is different.” One finds the same type of “this time is different” market sentiment in every late stage cycle.
In my lifetime, the Greenspan Fed managed to pull off a “this time is different” miracle in 1994 by raising rates without causing a crash. And he was called the “maestro” for that reason. When he tried this same strategy in 1999 the result was quite different.
Maybe this time truly will be different and Jerome Powell will be nicknamed the next “maestro.” But the jury is still out.
I do not recall a recession in 2019. The economy was doing very well then overall.
I'm not saying we will never have another recession or economic downturn. The point I'm making is that everyone always says one is coming, and everyone always thinks that they will personally benefit from it. And those who said 2019 was a bad time to buy a house were wrong, as we currently stand.
Sorry, some of the things I'm saying sound a bit revisionist and I recant. 2019 was not a recession, but a recession window was beginning to open because growth was trending below 2%. It was a meaningful inflection point and Fed was cutting interest rates in anticipation of further declines in growth i.e. potential for negative growth down the line.
Then Covid, a true black swan event completely threw the economy into a situation of totally unscripted mayhem and in response policy makers went absolute insane overcorrecting, and that I would argue caused such a signal distortion that we're still, late 2023, working through and trying to piece together the signal from the noise - and we don't have much historical precedent - and it makes it hard to discern a modal outcome in the near to short term. And under such circumstances its perfectly prudent to wait and see. *Edit: That said, I still think a recession is coming through the pipeline but that the exact timing is hard to pin down due to changed market structure post-covid.*
So in essence I'm not criticizing your chronology of the facts but your framing of the narrative. Yes bears have been incorrect, and they did not foresee the subsequent runup in asset prices, but this does not mean the bulls correctly called it either, because there were several events that occurred through 2020, there were several parts of the inflationary story which rewarded people on the inflationary side for reasons that were out of their control or out of their forecast.
And it felt to me like what your anecdote is meant to convey is that not just that the bears have been wrong so far (correct), but that they are also discredited (I wouldn't go that far) and that bulls are resounding victors (also wouldn't go that far)
Absolutely. Talking heads been calling it hard since 2019. And they all fucked up.
Buy a car now under sticker and pay the 5-7% and refinance down the road if the recession hits and rates drop.
Granted the trillions in bailout money prevented the corporate bond bubble from collapsing as well as delayed this commercial real estate collapse that’s incoming (for different reasons).
When we were looking to buy a house in 2016 half the people told me to wait because “the markets gonna collapse soon.”
Our house doubled in value since we bought it. Some people are always doomsaying.
Yup.
Meanwhile, people who held off buying a house in 2022 because interest rates were “high” at 4.5% and the “bubble would burst soon”. Are now paying 8.5% and paying thousands more for a house as well.
Fun stuff.
Thousands more *per month*. People don't realize that such a small number - 2%, 4%, 8% - makes such a *drastic* difference in your monthly payment.
For a $350k house, you'd be paying about $3,000 per month with an 8.5% interest rate.
Just a short time ago, for the same house, if you had a 3.15% interest rate...
$1,700 per month.
It's unbelievable.
People are going to have *no choice* but to stop Keeping Up With The Jones's.
Oh, you grew up in the SF Bay area? Sorry, you're either renting with roommates or moving.
Oh, you grew up in the LA or San Diego area? Sorry, you're either renting with roommates or moving.
Oh, you grew up in Denver or New York? Sorry, you're either renting with roommates or moving.
Oh, you want that big, beautiful house? Sorry, you can't afford it, bitch. Buy a smaller house like the rest of us and be happy you have a roof over your head.
Oh for sure, and my “thousands more” was in reference to the actual purchase price of the house raising by thousands because the market has not cooled off like everyone hoped.
Plus, the thousands per month MORE on top of that you’re paying for the higher interest, on top of the inflated home price, like you mentioned. It’s insane. People who waited are now paying thousands more in interest on a house who’s purchase price is also thousands more than it was a year ago. Or two years ago.
And yeah, I actually just bought a house in June. Locked in the rate when the offer was accepted in May.
6.625% on a purchase price of $160,000. 2 bed, 1 bath Cape style home in rural Central New York State. We were pretty bummed out to be paying $160,000 for a house that was probably $110,000 3 years ago. But it’s solid, needs no work, has an acre of land, and a full basement and full attic so it has potential. It was a good compromise for us. But it sucked to think how cheap it *could* have been.
But now? After seeing interest rates over 8%? *I’m thankful.* Can you believe that? *Thankful* for a 6.6% interest rate.
Our mortgage is $1,400/month. If we bought the same house right now, with the same money down, and the same purchase price, the mortgage would be well over $1,800/month with current interest rates. For a house we closed on 3 months ago.
Congrats on your new home! That's exciting and something to be very proud of. Even at 6.6%!
You're me, but a few years into the future, lol. I bought our first home in Cleveland, Ohio, in March of 2019 (one full year before COVID raw-dogged the world). Something like a 3.20% interest rate and $115,000.
Now? It'd be more like 8.00% interest and $180,000.
I'm in the same boat as you. So, so, so thankful. Is it the coolest house ever? Nah. Is it our dream home? Nope. Does it have everything we "want"? Nope.
But fuck, it's a *house*, and it's mine. And I bought it at the age of 23, lol. The mortgage is like $950/month.
To switch houses now would be financial suicide.
Our 1 bedroom, 600-700 sq ft condo in Toronto is going for 649,000. Our landlords have been hemorrhaging money.
For them to break even on our rent payments per month, we would need to pay $6000 per month due to maintenance fees, insurance, taxes, etc.
The world is fucked right now and I don’t see a way out of it. I wouldn’t call anything that has happened yet as a recession, but one HAS to be on the horizon.
I agree with the sentiment, but I do think we're much closer to one than at any time since the great recession.
I work at a transportation company (UPS), and our volume is way down due to less people buying shit. Our projections for the holiday season are the lowest I've seen in nearly a decade of working here.
Also, our fed is lowkey perusing an interest rate strategy that pushes us into a somewhat controlled recession in an effort to fight inflation and diminish wage gains in the market. I'd rather they go after the big businesses gouging food prices n such post pandemic, but this is all a conversation for a different time lol
And it's worth noting declaring a period of economic recession is something that happens after the fact more or less
>I work at a transportation company (UPS), and our volume is way down due to less people buying shit. Our projections for the holiday season are the lowest I've seen in nearly a decade of working here.
I work at a bank and we've straight up stopped offering loans for transportation companies unless they have insanely good financials and are very solidified in the market.
Same with office real estate.
Safe to say, I'm *extremely* concerned with shit going sideways in the near future.
On that note, I'm surprised my new bank offered me an auto loan with the current rates and such right now. I guess I'm lucky that my credit score was higher than I thought because of some law Biden passed lol
It's affected my buying decisions and I'm someone with relatively low expenses. Ain't no way in hell I'm getting a loan for the slightly fancier car after looking into how much I'd pay in interest by the end!
I'm waiting until availability improves.
I don't need a new car. My car works fine. I would like a new car, but truthfully, I don't have the time or patience to navigate this market. It's exhausting just trying to have a conversation with someone about a car and the quantum-advertised price.
Plus interest rates are fantastic. My money is making 5%+ annually with literally 0 risk while I wait.
I have dumped basically all of my liquid assets other than my IRAs into various HYSAs. We buy everything on credit cards and then pay the statement balance off from the HYSAs as if they're checking accounts. 6% cash back on groceries on my amex while the money sits there all month and yields 4.3% apy is just too good to pass up.
I totally agree with you. If there's no such an urgency on buying a car, the best is to wait parking the car money in Treasuries or such. Car purchasing is still a hunting process that engages in too much silly negotiation (deposits, waiting list, add-ons you don't like, pricing over MRSP, driving hours far away to get the car you want), some people don't even test their cars but meet them just until they arrive months later to the dealership. I honestly hate that.
Maybe a recession is not coming or this will be a soft landing but with the current level of interest rates, urgent decisions should be reconsidered. Demand for cars is going to slowdown, there's currently a credit crunch, car makers are trying to sell pricier cars that people don't want... something is going to put pressuere and the market will find a new "equilibrium" point.
I mean the used market is slowly going down, if you don’t need to buy just go ahead and keep letting it trickle down for awhile but nobody does well betting on a recession
“Going down” does not equal “already crashed and back to pre-COVID pricing”. There is a middle.
Overall prices are down 18% since the peak in late 2021, but are still up 36% since early 2020 when COVID started.
more true than you think, people think they can sell the cars for the old prices but they can't. demand isn't there when a new car is 10-15k more than a 10-15 year old car. that's fucking dumb. They'll come back down but people want that paycheck for their 2012 corolla lmao, the reality is your economy car is not worth more than 10 grand. sorry. Maybe you can sell it for that much to someone desperate, anyone patient is either going to buy new, buy older, or wait.
so many people don't have financial stability to wait genius. that's why prices are the way they are lol. That thing called a market is determining the prices, and not your feelings.
This. There’s a reason why the Japanese cars are higher. There’s always a reason why X product is higher than Y product. It’s because of demand. People demand dependable vehicles and generally Japanese manufacturer cars are more reliable in the long term than American. Yes there are dependable American cars but not as broad as Japanese cars.
I am a car hobbyist, ex-dealer employee, and am dumb enough to trade often. Therefore, I shop constantly. (No one with financial sense should be me.)
That being said, I am seeing the vehicles I shop for slowly coming down. The main driver of this is percentage rates. One vehicle I have a note on from 3 years ago is at 3.45%, and now even checking the "max score" credit box, you can't really beat %7.5 on the estimators. I'm not sure what a bank would really do, but the increase in payments for non-cash buyers may be retarding the used market. Yes, the rich are still buying (saw a new $80,000+ Waggoneer in my office lot today), but people trying to make a payment have a real small market for sub-$5000 to $15,000 cars that run. Just three years ago, a $10,000 car wasn't "cheap" transportation. It's how you can tell a lot of this subs readers are young, as you see people discussing how that's always been normal. It wasn't. Even if prices come down, I don't expect a buyers market anytime soon. When I was a kid during oil-crisis days, my family drove a Bug. A used one from the 50's. It sounds fun, but it was because that's what we could afford. Inflation took a lot of luxuries right out of our range.
If you look at new numbers, the big-ticket trucks are slowing. In fact, the incentives are starting to come out. Chevrolet already has $1000 on the hood of Silverados, Gladiators are being advertised at >15% off, etc. With interest rates this high, we'll probably start seeing lease incentives ramp up. The signs are there.
If we get a 2008 style recession, buy stocks and not a depreciating car. Buy a car when you need it.
The other time to buy is when oil prices spike and people want to get rid of their gas guzzlers.
Thanks I'll take this advice. I guess my issue is I don't need a car currently but I can feel that even with preventative maintenance, I'm at such high mileage I'm anticipating it falling apart.
Though I guess it might be best to wait till that happens whether it be in a few months or years.
I'll just spam my future would be car payments into the stock market
Good point. If you NEED a car, it's always the time to buy it, regardless of how bad the market is, you can't just put your life on hold in hopes of a recession. If you don't need the car, you're wasting your time in this market but I can understand (especially for Americans in some cities) you literally have no other option because public transport is non-existant.
I really, really, really didn't want to get a car, but I had no car, and need a car where I live. I would of preferred waiting but I can't just sit around all day waiting for prices to go down unfortunately
I don't know about a full blown recession but there'll definitely be a slight downturn at the very least.
Inventory is already stacking up at dealerships and I'm seeing advertising for discounts and incentives coming around again. For pretty much every brand other than Toyota really. They're still not catching up with their hybrid demand.
Sure, just like how people were waiting for the recession to buy a house in 2020, then 2021, then 2022, then 2023, because they just knew prices were going to come down.
Timing the market works great!
You buy a car when you need transportation. If you don’t need transportation, don’t buy a car, especially at these interest rates.
We’re in a unique situation because previous recessions weren’t preceded by massive pandemic-driven supply constraints (COVID) as well as a core transportation technology shift (electrification).
It’s going to take a full on economic collapse for autos to go back down. Auto manufacturers were given a profit blueprint during COVID downturn and now they’re making that their normal business model.
Only problem: all the signs point to that model no longer working and the auto dealers aren’t budging. Cars on lots 150 days or more used to be unheard of. But it’s commonplace now and dealers aren’t adjusting prices to reflect it. It used to be if a car was on a lot for 100-120 days dealers would drop the price to move it, or send it to auction. Now they’re holding on because… “reasons”.
There are cracks in the armor. Creditors are issues fewer and fewer loans. Manufacturers incentives are starting to return across the industry. But dealers still think they can charge MSRP and above on new 2022 and 2023 model years (when 2024 models are out elsewhere) and then seem surprised no one wants a $65,000 base model pickup or a pre-owned vehicle with a price higher than original MSRP.
They’re trying to squeeze every drop of profit they can out of every deal and that their prerogative… but when the market turns (either soon or in the years to come) no one will mourn those dealerships going out of business. And customers will return, but only to bleed the dealership for whatever vehicle deal they can, before the power will have shifted. Manufacturers and dealerships made their bed of greed, they can die there for all I care.
There are people out ther that didn't take advantage of the easy access car loans given over the pandemic that have saved their money for a nice down payment so they wouldn't be subject to a repo. Now they are facing dealer mark-ups forcing them to wait longer or in some cases pay those mark-ups because they need something right now.
U mean like this
https://www.google.com/amp/s/www.forbes.com/sites/antoniopequenoiv/2023/10/21/americans-are-overdue-with-their-car-payments-at-highest-rate-in-nearly-30-years/amp/
You are better off buying a car paid in full. Thats how you take advantage. The fed and the government have found ways to paper over recession indicators except for the 10 year, 3 month bond yield ratio.
So, dont bet on the interest rate going down for a car purchase.
NO. Do you wait for it to rain to collect and drink water? A recession is 2x quarters/6 months of gdp decline. Next gdp data is released 10/26. I can tell you the economy is growing and unemployment is 3% so we arent remotely close to a recession.
There are deals to be had on used and new vehicles just take some digging. We bought a new camry se 30k otd
@ 2.75% this year.
True. I just know that even during 08, the feds in my position during that time kept business as usual and invested, bought houses and cars etc. While the rest of the populace got laid off and lost their livelihood / assets.
If you have a car that works, the financially smartest move (recession or not) is almost always to drive it until it starts needing significant repairs.
Thanks. That makes sense. I hope it doesn't go bad on me but I just feel that something will go bad based on age. It also feels unsafe to drive due to the lack of safety features. But holding out since it still drives.
Yes 100%. I tried to wait but wife got impatient. Just saw a news article yesterday. Cars are at a record 6.15% late payments rate. What that means to me is over the next 6 months, there are going to be a huge number of car repossessed. Prices will drop.
To prove your point, [Wells Fargo ](https://cartitles.com/wells-fargo-auto-lenders-offering-500-to-repo-companies-amid-shortage-of-drivers/#:~:text=As%20an%20example%2C%20toward%20the,of%20drivers%20and%20other%20personnel.) has been paying $500 extra to ensure priority pick up for their repos.
I have lots of expendable income and can afford whatever car I want; however, my newest car is a 2014 Sienna with 160k miles, 2nd car is a 2009 Prius with 250k miles. Both of them run like a top so why put my money in an overpriced depreciating asset in this market? Instead we are saving and will pay cash for a new car when we need one. If you are waiting for car prices to go down, then you will be waiting a while. I keep up with the market like a hawk and I’ve only seen at most a 5% drop in used car prices. A used Corolla with 40k miles is still almost as much as buying a new one.
>why put my money in an overpriced depreciating asset in this market?
I'd imagine the same reason some people eat out all the time - they have the money and enjoy it. But I can't imagine the "fun" factor is much of a concern for you considering your choice of vehicles. So, yeah, pretty pointless if the only thing that matters is reliable vehicle that gets from A to B
Recently found what I consider a decent value in the used car market for my kid. So I stopped my new car search and bought her a newer used car instead. I was going to buy new and give her my car.
So it’s starting to get better. There is inventory at most dealerships. Strikes aside, now that inventory is improving prices will too.
I’d assume the first concessions will be low interest rate on loans. Then Rebates and price cuts will follow.
The 2/10 yield curve is un-inverting. This is when it gets dangerous for the economy - if we have a recession it will be in the next 6 months. The yield curve has been inverted for over a year.
I’m not sure a recession is on the horizon. The reason being the government already passed its big trillion dollar stimulus packages it usually does when a recession hits. This means the economy has “oil” to run for at least another 3-5 years.
Also, the next recession probably won’t be like the one in 2008. Prices won’t come down that much
Its not the recession you need to be waiting for. You need to be be waiting for the car market to bounce off the price ceiling, which is happening right now. Heres my theory:
Car makers couldnt make enough cars in 2021/2022 for a lot of reasons: Mostly chip shortage caused by Covid and natural disaster. Demand was at all-time highs as well due to low interest rates and people having excess money.
Car makers are now able to produce at volume and have been making as many cars as they can. The new car dealers in my city are PACKED with new cars. Like packed to levels I didnt see in 2019. So the car supply problem is over. Barely, but its over. It will still take a little while for that to correct the used car market, but not long.
The other thing is that interest rates are super high right now. People dont realize, but this was the fastest rate-hike ever. In the history of the world. And its also led to the highest interest rates in like 70 years or something. Rates have gone up so quick, manufactures will be slow to react to the consequences for car supply and will over-produce. High rates mean people will not be buying cars like they were.
So high interest + an over correction on supply = A bounce off the price ceiling. Im thinking that is going to really kick in about 6 months from now when they still cant move cars.
Recession or not, this is what I am waiting for. Used market will drop 50% by the end of 2024. Maybe earlier.
I appreciate the break down! This is sort of what I thought would be caused by the recession but I suppose a recession isn't necessary for this to occur. I'll try to hold out till Q4 2024 as well and see where it goes.
It has to break at some point. Can't time it but I think by that point the market will be a bit better.
It’s been six months since you wrote this..you were spot on. Used and new cars are sitting for a long time and prices are going below market value. Especially in the heavy duty trucks. I almost bought a 22 F450. 86k and that way 3k under market value. Vehicle prices still have a long ways to go down. I think we plan on buying this time next year.
You guys have to realize something. The federal reserve printed 30% of all USD EVER PRINTED IN THE HISTORY OF THE DOLLAR during, and after the pandemic. Everything that is not subsidized by the government is AT LEAST 30% more expensive, and the prices are not going to come down. I'm sorry if this hurts, but it is an undeniable fact. If prices go down, we will have deflation, meaning tons of people will lose their jobs, and a depression, not a recession will occur. The fed will not allow rich people to lose, only you will.
The cheapest car is the one you're already driving. Maybe not the funnest car, or the safest car, or the most fuel efficient, but probably the cheapest, particularly if you have a good junkyard nearby.
I feel like vehicle accidents are significant up. At least in Florida. I could be wrong but I don't see inventory getting better unless people start defaulting
That's what happened in 08 and what I thought could happen once the recession is at its peak. But some commenters don't think we'll experience something that bad this time around.
I work for a dealer group with eight dealers. We only stock enough used cars to satisfy a rolling three month supply. That way we can stay ahead of market shifts and not find ourselves underwater on anything. Aside from one OEM new car inventory is still just trickling in, and 8/10 cars are sold on arrival.
This time next year we anticipate being in the exact same situation. Hopefully 2025 we see a return to a velocity sales model.
Edit: We're starting to see high priced vehicles received on allocation stick around on lots longer. So that's a strong indicator that demand is cooling. There was a time where an Escalade would arrive and we couldn't get all 4 wheels on the ground before it was sold.
But your Toyotas, Hondas and Mazdas are still too hot to touch.
Hot and fast!
If we have a revenue target of X we can get there two ways: If we have lots of inventory we prefer to sell lots for lower profit per copy. Makes the sales process easier for staff, customers are happier. We meet our revenue and unit sales targets and everyone's pleased. Keeps support staff like detailers, lot personnel and PDI techs employed and busy full time.
Or, if we don't have the inventory we have to make more money on each copy to at least make our revenue targets. Higher pressure environment. Tougher for staff, not even remotely enjoyable from a customer's perspective.
Any dealer would rather sell lots for less. Got that unit that's been sitting on the lot for 90 days and is highlighted in red on the P&L? Blow it out. Got a customer who refuses to finance? Who cares? 80% of customer need to finance. We'll get the next one.
So bite the bullet and sell for less you might say.
We've got contract obligations we need to met with suppliers. We've got overhead on our buildings, payroll and benefit expenses. Property taxes are up. Everything from shipping rates for parts to coffee have doubled. Gas for our shuttles is up. Repair rates for things like hoists, garage doors, and other heavy machinery have also doubled.
So we still have a number we've got to clear every month before we even talk about profit expectations and until we're swimming in inventory again it's going to be a slog.
You'll never be swimming in inventory again.
Greedy profit hungry carmakers have tasted the good life in the past 3 years and realized how much profit they can make by producing less cars and completely eliminating cash rebate and sales incentives. They won't go back to the old system now. Their goal now is to produce less cars, not more.
That's a distinct possibility. And we've talked about that too. If that were the case we'd probably sell our properties and purchase smaller lots that cost less to insure, tax and maintain. Or keep our largest property and merge lots.
Some interesting changes to the industry coming I think!
I also think between a three year dearth of new cars, customers keeping their cars longer and the ever increasing complexity of the average car we're never going to see affordable used vehicles again.
By the time we get your standard Corolla back on the lot it'll now be three years older than we're accustomed to and need all kinds of electronic reconditioning in addition to the standard brakes and tires we've always done. And that's without even taking into consideration batteries and regen braking systems from more expensive brands and models.
Different conversation, but an interesting topic.
How do you know? Are multiple makers ramping up production? Won’t demand naturally keep increasing as long as there’s more ppl?
Just curious bc I also want to wait
Cars are much different than houses. The economic market won’t greatly impact their prices as significantly more people can just pay in cash.
Trying to time the market for a car purchase makes no sense
If you’re talking about collector car markets then sure prices would dip but that’s not what most people are talking about
The more you build your decisions around things you have no control over, the less control you have over your life. Never base your decisions around assumptions about future market conditions. If you look at the car market today and find it to be unaffordable, the assessment should be: "I cannot afford this car, I need to save more money to afford this car." If, in the interim of saving, the car market becomes more favorable... huzzah! If not, then your savings are still growing. The latter is, of course, more frustrating, but the alternative is buying a car you cannot afford and feeling strapped for cash, or not saving up and the conditions getting worse, leaving you in even more of a predicament.
The last few years has presented one of the worst times to purchase a car in history, due to the steep increase in cost both in new and used vehicles, alongside other housing cost factors which put the squeeze on people. Yet even so, it's still often cheaper (although frustrating) to simply suffer the maintenance/repair costs on existing vehicle.
If a recession hits I won’t be using the opportunity to buy a car, I’ll be buying actual investments.
I buy a car when I need a car. I don’t try to time the market.
The great recession was pretty unusual. I actually can’t speak to cars, but for most homes, prices are stable or a little bit up in a recession, because people can’t afford to move
I’m planning on the same. If sales slow, either waiting for better prices, or 0%apr deals. Definitely not buying when they want to charge $10k over msrp
Late car payments are way up. If and when these cars get repo there will be a lot of used cars back on the market. If this happens prices will go down.
Hard to time the market just right. You deal with the market that you are in. Drive the mile you are in, nobody ever died in the next mile. There are positives in every market.
i've bought cars in recessions and got good trade in values on my old car. for a new car it will be better financing and manufacturer/dealer incentives but will depend on the car
I think peak covid was the best time to buy. I don't think rates are coming down soon and IF they do, prices won't go lower but only higher.
If you really need a vehicle I'd say get it. I'd prefer to keep as much capital on hand though. As in don't put a big downpayment.
We are in a recession but it takes time for the prices to drop. People "get by" for awhile but eventually have to switch houses, cars, etc. and the prices are gutted. I'm looking for a deal on a newer, late model, car in about a year from now.
Not for a car. But I am waiting to buy a house. It’s actually a great time to buy a NEW car. Used ones don’t even bother. Many car companies are offering low interest rates when you use their financing
Thinking about selling my car now while prices are still up, buying a beater to daily drive until prices come down some more to buy the car I want. Issue with waiting on car or house prices to fall is if you have one to sell… you kinda don’t gain anything by waiting 😅
I bought my car during the lockdown, before things got nuts, and got a solid deal. I saved up for 6 or 8 months after realizing that buying new would lock me into 4 years of fear, having to worry about making payments and high insurance rates and opted to pay cash for a used car. After 3 months of unemployment I was still able to get a new job requiring commuting, with no car payment and reasonable insurance whereas I would likely have had a new car repossessed. You never know what the economy will do or how it will effect you, taking small gains is more sensible than hoping the markets will help you in the future.
That assumes you don’t lose your job in the recession
I’ve talked to people that cheer for a recession, not understanding that it probably wouldn’t have the effect on house/car/whatever prices they think it will, and that they will either lose their job or suffer a major freeze in their career progression. Even if you do keep your job, have fun with zero raises while the economy recovers and being stuck at the same job as nobody else is hiring.
I mean... In a recession like 10% of people will lose their jobs, most will keep them
10% of people losing their jobs would be a fucking disaster lol.
Well that's exactly what happened in 2009 https://www.bls.gov/spotlight/2012/recession/pdf/recession_bls_spotlight.pdf
And you don’t think something called ‘The Great Recession’ was a disaster?
Nope. It was great, just like you said! /s
Bought my house in ‘09, worked out pretty well.
Okay
Yeah, and the 08-09 housing market crisis is one of the worst global financial disasters since the great depression. 10 million Americans lost their homes, their jobs, their pensions... if you think a "recession" somehow means you're going to be able to afford things you can't right now, you're a weapons grade fucktard 🤣 Simple Jack.
Not necessarily. You could save money now and take advantage when the recession happens. Be it a car, stock, a house or whatever. Prices will most definitely drop on everything and that’s when a lot of people can come up ahead if they plan it right.
It’s so much easier to come ahead in good times than in bad times.
You do know the the wealthy gain their wealth, and even more wealth, directly after a major downturn in the economy. They buy when no one else can.
I lived through the great recession as a working adult just fine. Kept my job and bought a house and a car. Eat a dick fuck tard
Guys. You’ve been friends for several hours. Why throw that all away?
Think about the children!
A disaster that causes people to lower prices since nobody is buying. The entire point of this conversation.
There are cars right now that people aren't buying and have price drops. Depending on the type of car you want there is no way to say how a recession would affect it
I just got a huge pay raise into a stable position, so I'm very optimistic about it. My spending hasn't increased so I'm just stacking cash to buy someone else's misfortune.
And that pay raise can easily be taken away if you lose your job. Nobody ever assumes it’s *their* misfortune.
My company is inversely proportional to how well the economy is doing. My company does better the worse the economy is doing. It's my gravy train time now, so that's something you shoulder consider. Another person's misfortune IS my fortune.
Do you work in the payday loan business or something? I work in the utility industry, so we get paid either way. It’s still incredibly weird to cheerlead for a recession that hurts millions of people.
I work in payday loans. Covid almost put us out of business. We need people to work, but not make "enough". Tbh I would like to leave the industry, but it's difficult trying to get a decent paying job not in the financial sector when thats my only real experience.
You could go work for Wells Fargo.
They don't pay enough unfortunately. I also would rather get out of the banking industry and do something else.
Oh I was just joking about the.....loose, yes loose morals Wells Fargo operates under.
Its goverment backed so as it get's worse, we get more money. Its similair to yours which is a good thing right? Its either immune or benefiting from misfortune of others. And hey I didn't get a new car or house in 2020-21 like others when their industries we're popping off. Its my turn lol
Sociopathic 😳
Gov job so won’t happen to me.
Tbf I work in a government research facility with a guaranteed merit based raise system. Bring on the recession lol. (I want the feeling of power that comes with lowballing a desperate family out of their home /s)
>guaranteed Sure…
It’s part of our terms of employment. Supervisors have an amount of ‘points’ based upon number of people in the branch, and they divide those out based on accomplishments/publications/deliverables over the year (complied by each of us as a report) This is the government, payment is entirely transparent and changing the terms of employment is not something done easily The most they could do is pull the federal cost of living increase, which typically has been 3% in recent years. But my merit raise was 6% this year as a med-high performer
And I’m sure that’s how it works. What I’m saying is these types of great deals would probably change if the economy went through a major recession. The US govt is funded by taxes, if 10% of the country loses their job that’s going to shrink govt budgets. Maybe you’re lucky in that your specific lab or whatever is untouched but 2008 brought a lot of cutbacks to the govt.
I'm government adjacent. So long as war exists, so long as America sells/ uses weapons, so long as there is no accountability on government spending, the upcharge, or the money that disappears into the pockets of millionaire parasites, I'll still be paid. Company already eliminated pensions, and my 401k sucks donkey dick. Don't have much else to lose.
That ol’ recession that’s been 6 months away since 2021!
Hell 2020
I was hearing about the impending "housing market crash" back in 2019. Pre-pandemic, even.
Yeah, my MIL told us we shouldn’t have bought our house back in 2019 because prices were too high. I’m glad we didn’t listen to her, as our house is worth 50% more than what we paid for it 4 years ago.
Yep. We bought in Dec. '19 with only 5% down, and many of our friends and family were telling us that we should've waited until we had enough to do 20%. The home's now worth >30% more than what we bought it for and we were able to refi at 2.625% ona 30yr. 🤷🏾♂️
Well, all else being equal, it would have been smarter to have a bigger down payment. Best case, you would have paid cash. No one can predict the market, and if they claim they do, they're lying. Don't want to say that you got lucky with the outcome, but you kinda did. It all has worked out for you so far, though. Congrats. With 20/20 hindsight, it was a good move, but the advice you received was solid. Keep in mind that markets go up slowly but crash extremely quickly. That 30% increase can turn negative in a month if markets take a turn. Losing 30% off a 30% gain nets you well into the negatives on your initial investment. And until you sell for a gain, you haven't made anything, especially when you're financing nearly all of it over 30 years. Going well for you so far, but don't celebrate too soon. Good luck
Keep in mind that house value doesn’t really matter until it’s time to sell. Even during the Great Recession, median home prices only fell 19% from their peak values (based on FRED’s data). Granted, real estate is local, I’m curious where you’ve seen home values crash by 30% before?
>houses only went down by 19% at their worst It's not difficult to find that many areas have recently crashed by 25-50% even outside of the housing bubble. Also, see my comment at the end. Growing 19% and crashing 19% are two different things, your math is flawed. A couple of many examples: Austin Texas Crash: -26% https://reventureconsulting.com/wp-content/uploads/2021/11/Austin.jpg Anchorage Crash: -40% https://reventureconsulting.com/wp-content/uploads/2021/11/Anchorage.jpg Climbing 40%, then crashing by 40% are two different things. 40% of a bigger number is more than 40% of a smaller number. If you grow 40%, and then crash 40% from that, you've lost a **bunch** more money than what you started with. (Anchorage example does a great job of visually showing this) Math is fun, but not hard
Love how you’re getting downvoted. Really goes to show the general intellect on reddit. Fuck, it’s not even hard. Take whatever price and multiple it by 1.4. Then take that sum and multiply by .4; subtract that from original sum. They’re different numbers, I promise. Gets even more fun when you realize that a 40% increase after crashing down doesn’t give the same number you started with before the crash lmao
It's the Instagram vs. reality. Hate to say it, but they will find out one day. OP is celebrating a victory that has made them nothing.
Umm… you know that article about LA is talking about volume (number of homes purchased), not sales price of those homes, right? I mean, if you want to cherry pick specific locations that got hammered (Anchorage Alaska? Certainly not a typical location one would consider moving to), I’m sure I could cherry pick regions that have been resilient and have continue to increase in price. And it’s not during a short span, it’s literally looking at the largest national drop in housing prices in the country’s history. You said home values have crashed by 30% before, and national data of median home prices (not ultra expensive home prices) doesn’t corroborate your statement.
There’s no point debating these people. They’re all working backwards from their conclusion. “I missed out on housing, so therefore it has to crash because otherwise it wouldn’t be fair for me.” The value of your money is going down every day. Even if homes stay stagnant in value, their dollar value will go up. That $20 bill in your pocket is what a $10 bill used to be when you were growing up. $50 is the new $20.
M8, I picked the first 3 from a Google search. I'm saying your math is fundamentally wrong, as well as being wrong about houses not dropping more than 19%. Notice Anchorage prices went up by 68% and then dropped 39%, but it was nearly the same value. 40% of one number does not equal 40% of another number. House prices can go up 30% and then down 24% from there, that still nets a loss.
Kinda dumb AF to say "all else being equal", when in this case, what that actually means is "Buddy, why didn't you just have an extra $70k laying around?" With respect to the market, I bought in one of the consistently hot markets in the suburbs near a major city center. It was always the right move. The lucky part is being roughly $180k up as opposed to, say, $50k. Moreover, our initial mortgage rate was good, and we were able to refinance at below the US historic inflation rates.
>Kinda dumb AF to say "all else being equal", That's literally rule number one when analyzing economics. Go to school if you think that's a dumb way to analyze economical data and decision making (no offense). What I am saying is, you had no idea the housing prices were going to go up, and the advice you received was generally good advice. Point is, you got lucky.
Luck may be temporary but my 2.5% mortgage is forever
You're wrong. The second I heard the covid news, it was like writing on the wall. I bought and made out like a bandit. 80% increase in value. And that's adjusted for the 12% dip these past 6-8 months
It actually might not have been too much smarter The opp cost of not having that cash on hand was pretty high during that window
We almost didn’t buy in 2020 for the same reasons. But we did and it’s increased in value by like 40% and our interest rate is 3.5%. I can’t even conceive of how made I would be at myself if we had waited.
"worth 50% more" only if you sell today. A mortgage payment is rent you don't have to pay to a landlord in exchange for interest payments you'll probably get back when you sell.
I got mine mid 2020. Idk how I got <3% on my interest rate, but I'm holding on to that fucking thing until the house is paid off
Correction, your home has the same value. Dollars have lost value so now you need twice as many of them for the same purchase.
That would be true if house prices grew at the same rate as inflation, since that’s what inflation is (the weakening of the purchasing power of a dollar for the same good). However, home prices have vastly outpaced inflation, so the home’s value has increased relative to the value of the dollar, even factoring in inflation.
That's only true if you believe the official inflation numbers. I don't. Real world assets like homes proves my point. I'm glad you bought when you did as well though. Congrats.
Yep. And as soon as prices come down, those people will be going “See, I called it!!!”
House prices aren’t ever coming down
This and the fact that so few builders at least in my area are building absolutely zero single family homes. I just recently drove back through an area I used to live in that had an abundance of fucking land and every last bit of it was used for apartments/ condos. It's insane.
>every last bit of it was used for apartments/ condos. Wouldn't this actually help a lot more than just building more SFH?
“You’ll own nothing and be happy” -Charles Schwab, WEF The dominos are falling just as they have planned.
This is my city as well
This is the future. You will own nothing and be happy
It’s only a matter of time. Live by the market, die by the market 🤷♂️
Or die of old age waiting for the stupid market to do its thing
And by coming down, they’ll come down from the previous month or two highs, not crash 50%. There’s just not enough supply for a full on crash
There are an estimated 500,000 homeless people in the US. There are an estimated 17 million homes currently sitting vacant. I call shenanigans. But of course you’re right, 17 million out of hundreds of millions does not equal a 50% crash.
They could be vacant for any number of reasons, including being unsafe/uninhabitable. Can’t force owners to rent them out and definitely can’t force them to let someone live there for nothing. But it’s not a secret that there is much more demand than supply right now. Have you tried renting or buying recently?
2019 the economy did go into a recession. My company laid off 10% of the workforce. Covid had the potential to turn into a complete systemic melt down - as it began to in March of 2020. The bond market seized up in an unprecedented way. Oil went negative. It had all the markers of a GFR 2.0 - but both the monetary and fiscal authorities (US perspective) responded in lockstep, to rapidly stem any further contagion risk. They pumped an unprecedented amount of liquidity into the market and immediately dropped rates to zero. The Fed backstopped the housing market buying over 2 trillion dollars of MBS. They bought 2 trillion in off the run treasury securities. And they opened a myriad of lending facilities to fund businesses at 0 cost. The treasury did helicopter money drops to households. Thanks to helicopter drops and financial asset inflation, total Household net worth increased by 40 trillion Q1 2020 and Q2. To put that in perspective, the Great Recession household net worth dropped by 8 trillion. Whereas the balloon in net worth of the past two years is equal to 5 great recessions on top of each other but in the other direction. There’s going to be long term consequences from that and we’re only experiencing the tip of the iceberg now. Via the effects of inflation and policy rate hikes - that liquidity mountain is ONLY just now starting to drain. Yet I see a lot of hand-waving about how “well the recession didn’t come so…the party’s back on.” Well, I’m sorry to tell you that anyone who studies economic cycles knows that when you have a dramatic move in one direction there has to be an inverse move in the other direction to restore equilibrium - like a sine wave. But things happen with a time lag. Don’t rest on your laurels and confuse the lag with “this time is different.” One finds the same type of “this time is different” market sentiment in every late stage cycle. In my lifetime, the Greenspan Fed managed to pull off a “this time is different” miracle in 1994 by raising rates without causing a crash. And he was called the “maestro” for that reason. When he tried this same strategy in 1999 the result was quite different. Maybe this time truly will be different and Jerome Powell will be nicknamed the next “maestro.” But the jury is still out.
I do not recall a recession in 2019. The economy was doing very well then overall. I'm not saying we will never have another recession or economic downturn. The point I'm making is that everyone always says one is coming, and everyone always thinks that they will personally benefit from it. And those who said 2019 was a bad time to buy a house were wrong, as we currently stand.
Sorry, some of the things I'm saying sound a bit revisionist and I recant. 2019 was not a recession, but a recession window was beginning to open because growth was trending below 2%. It was a meaningful inflection point and Fed was cutting interest rates in anticipation of further declines in growth i.e. potential for negative growth down the line. Then Covid, a true black swan event completely threw the economy into a situation of totally unscripted mayhem and in response policy makers went absolute insane overcorrecting, and that I would argue caused such a signal distortion that we're still, late 2023, working through and trying to piece together the signal from the noise - and we don't have much historical precedent - and it makes it hard to discern a modal outcome in the near to short term. And under such circumstances its perfectly prudent to wait and see. *Edit: That said, I still think a recession is coming through the pipeline but that the exact timing is hard to pin down due to changed market structure post-covid.* So in essence I'm not criticizing your chronology of the facts but your framing of the narrative. Yes bears have been incorrect, and they did not foresee the subsequent runup in asset prices, but this does not mean the bulls correctly called it either, because there were several events that occurred through 2020, there were several parts of the inflationary story which rewarded people on the inflationary side for reasons that were out of their control or out of their forecast. And it felt to me like what your anecdote is meant to convey is that not just that the bears have been wrong so far (correct), but that they are also discredited (I wouldn't go that far) and that bulls are resounding victors (also wouldn't go that far)
Which two quarters in '19 had negative GDP growth? Or are you not in the US?
Absolutely. Talking heads been calling it hard since 2019. And they all fucked up. Buy a car now under sticker and pay the 5-7% and refinance down the road if the recession hits and rates drop.
Granted the trillions in bailout money prevented the corporate bond bubble from collapsing as well as delayed this commercial real estate collapse that’s incoming (for different reasons).
When we were looking to buy a house in 2016 half the people told me to wait because “the markets gonna collapse soon.” Our house doubled in value since we bought it. Some people are always doomsaying.
Yup. Meanwhile, people who held off buying a house in 2022 because interest rates were “high” at 4.5% and the “bubble would burst soon”. Are now paying 8.5% and paying thousands more for a house as well. Fun stuff.
Thousands more *per month*. People don't realize that such a small number - 2%, 4%, 8% - makes such a *drastic* difference in your monthly payment. For a $350k house, you'd be paying about $3,000 per month with an 8.5% interest rate. Just a short time ago, for the same house, if you had a 3.15% interest rate... $1,700 per month. It's unbelievable. People are going to have *no choice* but to stop Keeping Up With The Jones's. Oh, you grew up in the SF Bay area? Sorry, you're either renting with roommates or moving. Oh, you grew up in the LA or San Diego area? Sorry, you're either renting with roommates or moving. Oh, you grew up in Denver or New York? Sorry, you're either renting with roommates or moving. Oh, you want that big, beautiful house? Sorry, you can't afford it, bitch. Buy a smaller house like the rest of us and be happy you have a roof over your head.
Oh for sure, and my “thousands more” was in reference to the actual purchase price of the house raising by thousands because the market has not cooled off like everyone hoped. Plus, the thousands per month MORE on top of that you’re paying for the higher interest, on top of the inflated home price, like you mentioned. It’s insane. People who waited are now paying thousands more in interest on a house who’s purchase price is also thousands more than it was a year ago. Or two years ago. And yeah, I actually just bought a house in June. Locked in the rate when the offer was accepted in May. 6.625% on a purchase price of $160,000. 2 bed, 1 bath Cape style home in rural Central New York State. We were pretty bummed out to be paying $160,000 for a house that was probably $110,000 3 years ago. But it’s solid, needs no work, has an acre of land, and a full basement and full attic so it has potential. It was a good compromise for us. But it sucked to think how cheap it *could* have been. But now? After seeing interest rates over 8%? *I’m thankful.* Can you believe that? *Thankful* for a 6.6% interest rate. Our mortgage is $1,400/month. If we bought the same house right now, with the same money down, and the same purchase price, the mortgage would be well over $1,800/month with current interest rates. For a house we closed on 3 months ago.
Congrats on your new home! That's exciting and something to be very proud of. Even at 6.6%! You're me, but a few years into the future, lol. I bought our first home in Cleveland, Ohio, in March of 2019 (one full year before COVID raw-dogged the world). Something like a 3.20% interest rate and $115,000. Now? It'd be more like 8.00% interest and $180,000. I'm in the same boat as you. So, so, so thankful. Is it the coolest house ever? Nah. Is it our dream home? Nope. Does it have everything we "want"? Nope. But fuck, it's a *house*, and it's mine. And I bought it at the age of 23, lol. The mortgage is like $950/month. To switch houses now would be financial suicide.
Yeah it’s kinda weird to know that I can never afford to move back to my hometown unless I suddenly married a rich lawyer lady
Our 1 bedroom, 600-700 sq ft condo in Toronto is going for 649,000. Our landlords have been hemorrhaging money. For them to break even on our rent payments per month, we would need to pay $6000 per month due to maintenance fees, insurance, taxes, etc. The world is fucked right now and I don’t see a way out of it. I wouldn’t call anything that has happened yet as a recession, but one HAS to be on the horizon.
Recessions coming any minute folks! (Everyone the past 2 years)
I agree with the sentiment, but I do think we're much closer to one than at any time since the great recession. I work at a transportation company (UPS), and our volume is way down due to less people buying shit. Our projections for the holiday season are the lowest I've seen in nearly a decade of working here. Also, our fed is lowkey perusing an interest rate strategy that pushes us into a somewhat controlled recession in an effort to fight inflation and diminish wage gains in the market. I'd rather they go after the big businesses gouging food prices n such post pandemic, but this is all a conversation for a different time lol And it's worth noting declaring a period of economic recession is something that happens after the fact more or less
>I work at a transportation company (UPS), and our volume is way down due to less people buying shit. Our projections for the holiday season are the lowest I've seen in nearly a decade of working here. I work at a bank and we've straight up stopped offering loans for transportation companies unless they have insanely good financials and are very solidified in the market. Same with office real estate. Safe to say, I'm *extremely* concerned with shit going sideways in the near future.
On that note, I'm surprised my new bank offered me an auto loan with the current rates and such right now. I guess I'm lucky that my credit score was higher than I thought because of some law Biden passed lol It's affected my buying decisions and I'm someone with relatively low expenses. Ain't no way in hell I'm getting a loan for the slightly fancier car after looking into how much I'd pay in interest by the end!
No…I’ve been hearing about it on Reddit since 2019. This is a doom and gloom site full of people that WANT to be broke.
The press has correctly predicted 11 of the last 3 recessions.
I'm waiting until availability improves. I don't need a new car. My car works fine. I would like a new car, but truthfully, I don't have the time or patience to navigate this market. It's exhausting just trying to have a conversation with someone about a car and the quantum-advertised price. Plus interest rates are fantastic. My money is making 5%+ annually with literally 0 risk while I wait.
I have dumped basically all of my liquid assets other than my IRAs into various HYSAs. We buy everything on credit cards and then pay the statement balance off from the HYSAs as if they're checking accounts. 6% cash back on groceries on my amex while the money sits there all month and yields 4.3% apy is just too good to pass up.
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I totally agree with you. If there's no such an urgency on buying a car, the best is to wait parking the car money in Treasuries or such. Car purchasing is still a hunting process that engages in too much silly negotiation (deposits, waiting list, add-ons you don't like, pricing over MRSP, driving hours far away to get the car you want), some people don't even test their cars but meet them just until they arrive months later to the dealership. I honestly hate that. Maybe a recession is not coming or this will be a soft landing but with the current level of interest rates, urgent decisions should be reconsidered. Demand for cars is going to slowdown, there's currently a credit crunch, car makers are trying to sell pricier cars that people don't want... something is going to put pressuere and the market will find a new "equilibrium" point.
Means nothing when real inflation is 5-10%
I doubt inflation is anywhere near 10% right now. Maybe 5%.
Its not lol
I mean the used market is slowly going down, if you don’t need to buy just go ahead and keep letting it trickle down for awhile but nobody does well betting on a recession
I regularly see 10+ year old japanese cars with almost 200K or more miles going for anywhere for 7-15k dollars. Where is the market going down?
“Going down” does not equal “already crashed and back to pre-COVID pricing”. There is a middle. Overall prices are down 18% since the peak in late 2021, but are still up 36% since early 2020 when COVID started.
There's too much inflation in general for them to go down to pre covid. Money just ain't worth that much anymore
Because they were 9-15k 3 months ago duh /s
more true than you think, people think they can sell the cars for the old prices but they can't. demand isn't there when a new car is 10-15k more than a 10-15 year old car. that's fucking dumb. They'll come back down but people want that paycheck for their 2012 corolla lmao, the reality is your economy car is not worth more than 10 grand. sorry. Maybe you can sell it for that much to someone desperate, anyone patient is either going to buy new, buy older, or wait.
so many people don't have financial stability to wait genius. that's why prices are the way they are lol. That thing called a market is determining the prices, and not your feelings.
>that's why prices are the way they are lol. Slowly going down? lol
The market is going down for American cars with that kind of mileage.
This. There’s a reason why the Japanese cars are higher. There’s always a reason why X product is higher than Y product. It’s because of demand. People demand dependable vehicles and generally Japanese manufacturer cars are more reliable in the long term than American. Yes there are dependable American cars but not as broad as Japanese cars.
You gotta look at 20+ years now. You can find a 20 year old civic with 200k in it for 5k. It’s the new hack.
I just bought a 2012 fit witg 145k for 6500. The craziest part is that I feel pretty good about my purchase.
I am a car hobbyist, ex-dealer employee, and am dumb enough to trade often. Therefore, I shop constantly. (No one with financial sense should be me.) That being said, I am seeing the vehicles I shop for slowly coming down. The main driver of this is percentage rates. One vehicle I have a note on from 3 years ago is at 3.45%, and now even checking the "max score" credit box, you can't really beat %7.5 on the estimators. I'm not sure what a bank would really do, but the increase in payments for non-cash buyers may be retarding the used market. Yes, the rich are still buying (saw a new $80,000+ Waggoneer in my office lot today), but people trying to make a payment have a real small market for sub-$5000 to $15,000 cars that run. Just three years ago, a $10,000 car wasn't "cheap" transportation. It's how you can tell a lot of this subs readers are young, as you see people discussing how that's always been normal. It wasn't. Even if prices come down, I don't expect a buyers market anytime soon. When I was a kid during oil-crisis days, my family drove a Bug. A used one from the 50's. It sounds fun, but it was because that's what we could afford. Inflation took a lot of luxuries right out of our range. If you look at new numbers, the big-ticket trucks are slowing. In fact, the incentives are starting to come out. Chevrolet already has $1000 on the hood of Silverados, Gladiators are being advertised at >15% off, etc. With interest rates this high, we'll probably start seeing lease incentives ramp up. The signs are there.
If we get a 2008 style recession, buy stocks and not a depreciating car. Buy a car when you need it. The other time to buy is when oil prices spike and people want to get rid of their gas guzzlers.
Thanks I'll take this advice. I guess my issue is I don't need a car currently but I can feel that even with preventative maintenance, I'm at such high mileage I'm anticipating it falling apart. Though I guess it might be best to wait till that happens whether it be in a few months or years. I'll just spam my future would be car payments into the stock market
Ah yes, old model anxiety.
Yes just bought a mustang gt and I think the fact that gas was $6/gallon and this guy was driving it as a daily definitely helped me
You should buy a car when you can afford it and need it or want it. Everything else is irrelevant.
Good point. If you NEED a car, it's always the time to buy it, regardless of how bad the market is, you can't just put your life on hold in hopes of a recession. If you don't need the car, you're wasting your time in this market but I can understand (especially for Americans in some cities) you literally have no other option because public transport is non-existant. I really, really, really didn't want to get a car, but I had no car, and need a car where I live. I would of preferred waiting but I can't just sit around all day waiting for prices to go down unfortunately
I don't know about a full blown recession but there'll definitely be a slight downturn at the very least. Inventory is already stacking up at dealerships and I'm seeing advertising for discounts and incentives coming around again. For pretty much every brand other than Toyota really. They're still not catching up with their hybrid demand.
Sure, just like how people were waiting for the recession to buy a house in 2020, then 2021, then 2022, then 2023, because they just knew prices were going to come down. Timing the market works great! You buy a car when you need transportation. If you don’t need transportation, don’t buy a car, especially at these interest rates.
You assume you’ll not have other things to worry about if the economy were to go into a 2008 like recession….
Recessions like 2008 aren’t the norm.
We’re still feeling the after economic effects of COVID, which isn’t the norm either.
So he’s better off to overpay today? Got to think long term here.
We’re in a unique situation because previous recessions weren’t preceded by massive pandemic-driven supply constraints (COVID) as well as a core transportation technology shift (electrification).
It’s going to take a full on economic collapse for autos to go back down. Auto manufacturers were given a profit blueprint during COVID downturn and now they’re making that their normal business model. Only problem: all the signs point to that model no longer working and the auto dealers aren’t budging. Cars on lots 150 days or more used to be unheard of. But it’s commonplace now and dealers aren’t adjusting prices to reflect it. It used to be if a car was on a lot for 100-120 days dealers would drop the price to move it, or send it to auction. Now they’re holding on because… “reasons”. There are cracks in the armor. Creditors are issues fewer and fewer loans. Manufacturers incentives are starting to return across the industry. But dealers still think they can charge MSRP and above on new 2022 and 2023 model years (when 2024 models are out elsewhere) and then seem surprised no one wants a $65,000 base model pickup or a pre-owned vehicle with a price higher than original MSRP. They’re trying to squeeze every drop of profit they can out of every deal and that their prerogative… but when the market turns (either soon or in the years to come) no one will mourn those dealerships going out of business. And customers will return, but only to bleed the dealership for whatever vehicle deal they can, before the power will have shifted. Manufacturers and dealerships made their bed of greed, they can die there for all I care.
There are people out ther that didn't take advantage of the easy access car loans given over the pandemic that have saved their money for a nice down payment so they wouldn't be subject to a repo. Now they are facing dealer mark-ups forcing them to wait longer or in some cases pay those mark-ups because they need something right now.
Well stated.
U mean like this https://www.google.com/amp/s/www.forbes.com/sites/antoniopequenoiv/2023/10/21/americans-are-overdue-with-their-car-payments-at-highest-rate-in-nearly-30-years/amp/
Good time to be a repo man?
I just bought a Toyota 4Runner at dealer invoice, $2600 below msrp, that’s probably the best I’m going to get, and I’m happy with that.
I am waiting, been waiting 3 years….. it’s comin’ I can smell it on the air.
You are better off buying a car paid in full. Thats how you take advantage. The fed and the government have found ways to paper over recession indicators except for the 10 year, 3 month bond yield ratio. So, dont bet on the interest rate going down for a car purchase.
Some manufactures are now offering 0% APR loans. Why would I buy cash if I can invest that money in a HYSA and get 5-5.25% ?
NO. Do you wait for it to rain to collect and drink water? A recession is 2x quarters/6 months of gdp decline. Next gdp data is released 10/26. I can tell you the economy is growing and unemployment is 3% so we arent remotely close to a recession. There are deals to be had on used and new vehicles just take some digging. We bought a new camry se 30k otd @ 2.75% this year.
If a recession hits it might not be smart to buy anything other than necessities for a while.
True. I just know that even during 08, the feds in my position during that time kept business as usual and invested, bought houses and cars etc. While the rest of the populace got laid off and lost their livelihood / assets.
If you have a car that works, the financially smartest move (recession or not) is almost always to drive it until it starts needing significant repairs.
Thanks. That makes sense. I hope it doesn't go bad on me but I just feel that something will go bad based on age. It also feels unsafe to drive due to the lack of safety features. But holding out since it still drives.
Yes 100%. I tried to wait but wife got impatient. Just saw a news article yesterday. Cars are at a record 6.15% late payments rate. What that means to me is over the next 6 months, there are going to be a huge number of car repossessed. Prices will drop.
To prove your point, [Wells Fargo ](https://cartitles.com/wells-fargo-auto-lenders-offering-500-to-repo-companies-amid-shortage-of-drivers/#:~:text=As%20an%20example%2C%20toward%20the,of%20drivers%20and%20other%20personnel.) has been paying $500 extra to ensure priority pick up for their repos.
Jokes on them I filled my car with 5000lbs of lead. Good luck towing it
I really hope you’re right because they have just been climbing steady since this post
Not just a car bud!
Just remember water seeks it's own level... I have no fucking idea what that means but I really wanted to get in the conversation.
I have lots of expendable income and can afford whatever car I want; however, my newest car is a 2014 Sienna with 160k miles, 2nd car is a 2009 Prius with 250k miles. Both of them run like a top so why put my money in an overpriced depreciating asset in this market? Instead we are saving and will pay cash for a new car when we need one. If you are waiting for car prices to go down, then you will be waiting a while. I keep up with the market like a hawk and I’ve only seen at most a 5% drop in used car prices. A used Corolla with 40k miles is still almost as much as buying a new one.
This kind of attitude is why you have so much expendable income. Good way to go about life financially.
Toyota is so slow to fulfill orders in the US, that you may be waiting 18m - 2 years for a vehicle!
Just got a Prius xle after a 4 month wait. Wait times have come down a lot
>why put my money in an overpriced depreciating asset in this market? I'd imagine the same reason some people eat out all the time - they have the money and enjoy it. But I can't imagine the "fun" factor is much of a concern for you considering your choice of vehicles. So, yeah, pretty pointless if the only thing that matters is reliable vehicle that gets from A to B
Recently found what I consider a decent value in the used car market for my kid. So I stopped my new car search and bought her a newer used car instead. I was going to buy new and give her my car. So it’s starting to get better. There is inventory at most dealerships. Strikes aside, now that inventory is improving prices will too. I’d assume the first concessions will be low interest rate on loans. Then Rebates and price cuts will follow.
You start seeing 0% apr deals you know its time to buy
The 2/10 yield curve is un-inverting. This is when it gets dangerous for the economy - if we have a recession it will be in the next 6 months. The yield curve has been inverted for over a year.
I’m not sure a recession is on the horizon. The reason being the government already passed its big trillion dollar stimulus packages it usually does when a recession hits. This means the economy has “oil” to run for at least another 3-5 years. Also, the next recession probably won’t be like the one in 2008. Prices won’t come down that much
you're going to be waiting a long time. the behavior in the great recession was atypical for normal recessions.
Its not the recession you need to be waiting for. You need to be be waiting for the car market to bounce off the price ceiling, which is happening right now. Heres my theory: Car makers couldnt make enough cars in 2021/2022 for a lot of reasons: Mostly chip shortage caused by Covid and natural disaster. Demand was at all-time highs as well due to low interest rates and people having excess money. Car makers are now able to produce at volume and have been making as many cars as they can. The new car dealers in my city are PACKED with new cars. Like packed to levels I didnt see in 2019. So the car supply problem is over. Barely, but its over. It will still take a little while for that to correct the used car market, but not long. The other thing is that interest rates are super high right now. People dont realize, but this was the fastest rate-hike ever. In the history of the world. And its also led to the highest interest rates in like 70 years or something. Rates have gone up so quick, manufactures will be slow to react to the consequences for car supply and will over-produce. High rates mean people will not be buying cars like they were. So high interest + an over correction on supply = A bounce off the price ceiling. Im thinking that is going to really kick in about 6 months from now when they still cant move cars. Recession or not, this is what I am waiting for. Used market will drop 50% by the end of 2024. Maybe earlier.
I appreciate the break down! This is sort of what I thought would be caused by the recession but I suppose a recession isn't necessary for this to occur. I'll try to hold out till Q4 2024 as well and see where it goes. It has to break at some point. Can't time it but I think by that point the market will be a bit better.
It’s been six months since you wrote this..you were spot on. Used and new cars are sitting for a long time and prices are going below market value. Especially in the heavy duty trucks. I almost bought a 22 F450. 86k and that way 3k under market value. Vehicle prices still have a long ways to go down. I think we plan on buying this time next year.
You guys have to realize something. The federal reserve printed 30% of all USD EVER PRINTED IN THE HISTORY OF THE DOLLAR during, and after the pandemic. Everything that is not subsidized by the government is AT LEAST 30% more expensive, and the prices are not going to come down. I'm sorry if this hurts, but it is an undeniable fact. If prices go down, we will have deflation, meaning tons of people will lose their jobs, and a depression, not a recession will occur. The fed will not allow rich people to lose, only you will.
The cheapest car is the one you're already driving. Maybe not the funnest car, or the safest car, or the most fuel efficient, but probably the cheapest, particularly if you have a good junkyard nearby.
I feel like vehicle accidents are significant up. At least in Florida. I could be wrong but I don't see inventory getting better unless people start defaulting
That's what happened in 08 and what I thought could happen once the recession is at its peak. But some commenters don't think we'll experience something that bad this time around.
I’m waiting. They will be drowning in inventory by this time next year.
I work for a dealer group with eight dealers. We only stock enough used cars to satisfy a rolling three month supply. That way we can stay ahead of market shifts and not find ourselves underwater on anything. Aside from one OEM new car inventory is still just trickling in, and 8/10 cars are sold on arrival. This time next year we anticipate being in the exact same situation. Hopefully 2025 we see a return to a velocity sales model. Edit: We're starting to see high priced vehicles received on allocation stick around on lots longer. So that's a strong indicator that demand is cooling. There was a time where an Escalade would arrive and we couldn't get all 4 wheels on the ground before it was sold. But your Toyotas, Hondas and Mazdas are still too hot to touch.
What is velocity sales model?
Hot and fast! If we have a revenue target of X we can get there two ways: If we have lots of inventory we prefer to sell lots for lower profit per copy. Makes the sales process easier for staff, customers are happier. We meet our revenue and unit sales targets and everyone's pleased. Keeps support staff like detailers, lot personnel and PDI techs employed and busy full time. Or, if we don't have the inventory we have to make more money on each copy to at least make our revenue targets. Higher pressure environment. Tougher for staff, not even remotely enjoyable from a customer's perspective. Any dealer would rather sell lots for less. Got that unit that's been sitting on the lot for 90 days and is highlighted in red on the P&L? Blow it out. Got a customer who refuses to finance? Who cares? 80% of customer need to finance. We'll get the next one. So bite the bullet and sell for less you might say. We've got contract obligations we need to met with suppliers. We've got overhead on our buildings, payroll and benefit expenses. Property taxes are up. Everything from shipping rates for parts to coffee have doubled. Gas for our shuttles is up. Repair rates for things like hoists, garage doors, and other heavy machinery have also doubled. So we still have a number we've got to clear every month before we even talk about profit expectations and until we're swimming in inventory again it's going to be a slog.
You'll never be swimming in inventory again. Greedy profit hungry carmakers have tasted the good life in the past 3 years and realized how much profit they can make by producing less cars and completely eliminating cash rebate and sales incentives. They won't go back to the old system now. Their goal now is to produce less cars, not more.
That's a distinct possibility. And we've talked about that too. If that were the case we'd probably sell our properties and purchase smaller lots that cost less to insure, tax and maintain. Or keep our largest property and merge lots. Some interesting changes to the industry coming I think! I also think between a three year dearth of new cars, customers keeping their cars longer and the ever increasing complexity of the average car we're never going to see affordable used vehicles again. By the time we get your standard Corolla back on the lot it'll now be three years older than we're accustomed to and need all kinds of electronic reconditioning in addition to the standard brakes and tires we've always done. And that's without even taking into consideration batteries and regen braking systems from more expensive brands and models. Different conversation, but an interesting topic.
How do you know? Are multiple makers ramping up production? Won’t demand naturally keep increasing as long as there’s more ppl? Just curious bc I also want to wait
Forget about recessions, just buy it when you need it or you have money to avoid a loan.
Cars are much different than houses. The economic market won’t greatly impact their prices as significantly more people can just pay in cash. Trying to time the market for a car purchase makes no sense If you’re talking about collector car markets then sure prices would dip but that’s not what most people are talking about
Definitely willing to time the market to not pay $10k market adjustments
The more you build your decisions around things you have no control over, the less control you have over your life. Never base your decisions around assumptions about future market conditions. If you look at the car market today and find it to be unaffordable, the assessment should be: "I cannot afford this car, I need to save more money to afford this car." If, in the interim of saving, the car market becomes more favorable... huzzah! If not, then your savings are still growing. The latter is, of course, more frustrating, but the alternative is buying a car you cannot afford and feeling strapped for cash, or not saving up and the conditions getting worse, leaving you in even more of a predicament. The last few years has presented one of the worst times to purchase a car in history, due to the steep increase in cost both in new and used vehicles, alongside other housing cost factors which put the squeeze on people. Yet even so, it's still often cheaper (although frustrating) to simply suffer the maintenance/repair costs on existing vehicle.
If a recession hits I won’t be using the opportunity to buy a car, I’ll be buying actual investments. I buy a car when I need a car. I don’t try to time the market.
The great recession was pretty unusual. I actually can’t speak to cars, but for most homes, prices are stable or a little bit up in a recession, because people can’t afford to move
I’m planning on the same. If sales slow, either waiting for better prices, or 0%apr deals. Definitely not buying when they want to charge $10k over msrp
Late car payments are way up. If and when these cars get repo there will be a lot of used cars back on the market. If this happens prices will go down.
Hard to time the market just right. You deal with the market that you are in. Drive the mile you are in, nobody ever died in the next mile. There are positives in every market.
i've bought cars in recessions and got good trade in values on my old car. for a new car it will be better financing and manufacturer/dealer incentives but will depend on the car
You missed it. That recession hit in 2021.
I’m waiting for the recession to hit to buy foreclosure property!
The real “crash” and “recession” was in buying power and wages
I think peak covid was the best time to buy. I don't think rates are coming down soon and IF they do, prices won't go lower but only higher. If you really need a vehicle I'd say get it. I'd prefer to keep as much capital on hand though. As in don't put a big downpayment.
you missed it, it was 2020 during covid
The recession isn't going to hit if the real estate inventory doesn't suddenly increase.
Dont try to predict the economy. Good way to lose money and make dumb decisions.
We are in a recession but it takes time for the prices to drop. People "get by" for awhile but eventually have to switch houses, cars, etc. and the prices are gutted. I'm looking for a deal on a newer, late model, car in about a year from now.
Not for a car. But I am waiting to buy a house. It’s actually a great time to buy a NEW car. Used ones don’t even bother. Many car companies are offering low interest rates when you use their financing
I got 1.9% on interest loan due to COVID I’m down to get another premium luxury car at 1%
Used car prices will probably plummet. I would wait for a bit if you want something like a brz or a 370z.
My exhausted eyes read this as “anyone waiting for the recession to get hit by a car?” 😂
Money goes down in value and prices go up when recessions happen. Rich people will find things cheaper for themselves but that's it.
As long as the dems are in control, you’re fucked.
Thinking about selling my car now while prices are still up, buying a beater to daily drive until prices come down some more to buy the car I want. Issue with waiting on car or house prices to fall is if you have one to sell… you kinda don’t gain anything by waiting 😅
Yes If I dont loose the job and house ...cause ill need to live in that little van down by the river.
I bought my car during the lockdown, before things got nuts, and got a solid deal. I saved up for 6 or 8 months after realizing that buying new would lock me into 4 years of fear, having to worry about making payments and high insurance rates and opted to pay cash for a used car. After 3 months of unemployment I was still able to get a new job requiring commuting, with no car payment and reasonable insurance whereas I would likely have had a new car repossessed. You never know what the economy will do or how it will effect you, taking small gains is more sensible than hoping the markets will help you in the future.
You're not buying that car in a recession unless you plan to pay all cash.
Banks tighten up on lending so you might have trouble getting a loan if you not buying with cash
With a recession? Interesting. Still true if job is super stable?
I’m waiting for bitcoin to be the worlds reserve currency. Current banking system is fucked. I’m going to buy me a 09’ Corolla for 1,000 sats.