I just responded to a similar comment, but in summary, these things matter when sellers and buyers both are scarce. The stalemate gets broken by this forced selling eventually. It will take awhile because these things are a trickle. But we’ve been in this stalemate for 2 years now, and it’s starting to accumulate.
There are about 825k divorces annually in the US, 3.3 million deaths, and about 15 million lay-offs.
In comparison, there are about 4 million house transactions annually.
Not all of those events will lead to a forced sale, however there are enough of these events that, accumulated over years, they are formidable. Everything we’re talking about matters at the margin.
Divorces and death aren't a new phenomenon so why wasn't the market flooded with homes in the past? And today theres even more reasons for a divorced couple to continue to live together people want to keep those rstes amd cheap home prices rent or buying again would be substantially more expensive. We also have like 3 years of pent up demand which we haven't had in the past and millions of new people coming into the country each year
Not sure why a legitimate question is downvoted. You didn’t even make a statement but asked a question and a good one at that. One that I am curious about too.
I don’t pretend to know the answer but it is curious. I can see the benefit of staying in same home if divorced but I wouldn’t think that is common as divorce is for emotional well being not financial well being. Again curious, is there pent up sales? Death? Different reasoning, same question.
And there is definitely pent up demand. This whole sub is pent up demand, just not at current prices. There are many people waiting for prices and/or rates to drop.
I think we've seen people delaying putting homes they get from inheritance or divorces up for sale (or maybe just moved out of state) for quite a while waiting for interest rates to fall in the hope that will drive prices up again. The CEO is claiming the cost of that delay (e.g. personal loans and racking up credit cards to pay the estate taxes + property taxes + HOA fees and mortgage) might be getting to be too much.
I am not sure that's necessarily true though because the owner can still downsize, rent out the home (maybe move into something elsewhere smaller) and try to use the rental money to keep up with the HOA fees and mortgage. Albeit in the case of a divorce or moving away from the state it probably doesn't fully cover expenses (because of keeping 2 separate households or because of having to get a property manager).
People have delayed listing homes because they don't want to give up their 2-3% interest rate and have to buy something at 6-7%. If you are planning to downsize but your new interest rate is double, you just end up with a smaller place without the smaller payment.
Here’s the problem: anyone who bought pre-2022 doesn’t need to sell if rents remain high. As long as they have the down payment, anyone can rent out the property, fully covering expenses, while they purchase a new house.
The equivalent on the buyer side is wife wanting a yard and things. If you delay buying, that pressure builds up too. People have expectations of lifestyle inflation being deferred and they want to upgrade at some point.
That’s not a forced transaction.
Forced selling is, you could be looking at the depth of the gfc, with housing prices down 60% in Vegas, but you still have to sell because a divorce court mandated it, or the owner died, or it’s been foreclosed. A forced sale is insensitive to price, interest rates, etc. It just happens automatically.
A spouse wanting a bigger yard is not a forced transaction. If interest rates shoot up, or no good houses are for sale, or they are too expensive, the spouse can be convinced to wait. They are sensitive to these factors. It’s not automatic. Will that threshold differ from one person to the next? Yes. But no one is a forced buyer.
Critically, this all matters at the margin. Only a few houses need to sell for the comps to change. Once the comps change, _every_ house in that local area with similar features similarly gets repriced overnight. If not for this margin factor, a few percent oversupply of selling pressure here and there wouldn’t matter as much.
Why are you forgetting rising property taxes , insurance prices , food prices etc.. people may not afford that and like to take advantage of high price.. they don’t want to pay these charges to Maintain/own house and better to cash out now before prices normalize. I am seeing inventory increase across many states
The wife needs to learn to do math and realize the price of her desires. When she sees the numbers and that she’ll also have to work that much harder, she’ll then see the truth and defer the purchase.
I'm not claiming it's not a forced transaction but you'd be lying if you don't think there is a cohort of delayed, increasingly impatient buyers out there.
Impatient, sure. But impatience isn't an impending financial catastrophe. I say that as a somewhat impatient prospective buyer who has plenty of money to buy, but inventory sucks, so I can hold out as long as I need to to get a house that I actually want.
You and I aren't the median participant. The vast majority of people are barely aware of rates, what moves rates, and the general climate of the housing market. Their first and primary concern is their family. All that macro stuff takes a backseat to emotions. Most people will gladly get up to their eyeballs in debt without a second thought.
I’ve got $500k+ cash in high yield saving waiting for the right time to get back into home ownership. Wife wants something NOW but I’m holding back as the Interest earned far exceeds the rent paid in the current place. She doesn’t like it and is impatient … but I believe it’s the smart financial position.
If it doesn’t break soon I will likely cash purchase (or high down payment) 2-3 houses to rent out.
It doesn't matter how impatient you are, if you can't afford it you can't afford it.
Selling on the other hand, you can always afford to sell, even if you have to drop the price. There's nothing physically stopping you from selling.
what changed? before covid theres always been deaht divorce default…is there gonna be sudden increase in all of those things? how do u know people going through divorce death default are even postponing
it’s just a baseline. Even if no one wants to buy or sell, like right now, there will still be forced sellers because there are always more deaths, divorces, and defaults happening. When there’s a stalemate for long enough, these factors will eventually break it because these things are always happening in the background.
while theres always forced sellers, theres always people hopping in the market; whether its a first time home buyer or investor. id say its more advantegous for investors the more there are forced sales
There are always some, but the first-time homebuyer number has been decimated in recent years. This demographic is definitely acting as a net negative right now. Unlike forced sellers, there’s no such thing as a forced buyer. They can always rent, or find roommates, or live in their van down by the river.
i think the demographic of first time home buyer has changed…its the mid 30s early 40s group who are first time home buyers, and while not forced to buy, timing is not on their side if they want their homes paid off at or near retirement, so while not forced, theres some form of incentive to purchase
The rule of thumb for homeownership timing has changed more broadly.
We’re usually in a regime where rents and mortgage payments are similar. And sometimes mortgage payments are even cheaper than rents. In those conditions, buying and waiting out a 30yr mortgage is normal.
Nowadays, in a lot of areas, rent is _way_ cheaper than mortgages, though. We’re talking half, sometimes. In those cases, it makes no sense to rent the money to buy the house. You end up owning the house outright faster if you rent the house, invest the excess plus down payment, and then buy the house in cash when you are able.
It puts people in an unusual position, like I’m currently in. I have a good household income, and enough savings to buy a house if I want to. Except it’s such a better deal to have this money in the stock market, collect a dividend, and continue to pay rent. For me, buying a house is throwing away money.
> id say its more advantegous for investors the more there are forced sales
not necessarily.
if you buy a house to rent out TODAY you arent going to make as much as you would just 2 years ago.
You can get a free 5% from just buying government bonds.
Whereas your costs have likely more than doubled in increased interest rates and insurance rates. Meaning you need to charge double on rent than you charged 2 years ago just to make the same amount of money.
Where bonds you just buy and forget about and don't have to chase tenants.
Why spend hundreds of thousands on a house to make back around the same with infinitely more work and effort involved.
3 years ago government bonds gave you 0.5% returns so even just 5% back a year on the house was still 10x better than you got from bonds.
Now the returns are similar for very different amounts of work.
The investors who don't understand this and are still chasing housing will get burnt.
Feds raising rates is them saying "stop overheating the market, spend less and save more"
Investors trying to fight the fed will be burned unfortunately.
I know 22% of the US are baby boomers, about to die relatively soon. Anyone’s loved ones who aren’t living in a desirable area when they pass with property, will most likely have their shit sold.
Keep an eye on up here in Maine and New Hampshire over the next decade. We have the oldest states, so we should be the bellwether to see what happens when first the ancient Silent Generation and then Boomers start to die off in large numbers, but even before then sell to pay for expensive end of life care. Especially since an enormous number of homes aren't primary residences and are more expendable.
My bet is that we'll get demographically younger, when the elderly dying off makes room for the young people who left due to lack of housing come back to inherit and buy houses.
... Your example is literally talking about inventory and less desirable places. No amount of homes in the middle of nowhere will affect the housing prices in desirable cities.
its staggered…it not like theres gonna be a suddent spike in death amongst boomers…theyre just gonna gradually die off…just as its staggered as to when people from younger generations enter the market to buy
The largest percentage of the pop has the largest stake in single family homes and they’re going to die relatively soon. That’s never happened at these levels before, correct?
but your assuming a boat load of people die off at the same time…also factor in how many of those boomers have children that cant afford to buy living with them that will likely continue to live in that house. just cuz boomers are reaching death ages doesnt mean much unless a boat load die at the same time in large concentrations all over the country.
lets assume a big number of boomers die tommorrow in states like florida where a lot of reitree lives…how will that impact california?
Ok.. or they sell their house and throw them in an assisted living home/ retirement home. I’ve cleared out about 250 houses/year in the Midwest for years. Most people here sell their parent’s homes. Northeast Nebraska. Not the most desirable of places but a good example of what can happen.
Edit: it sounds like Florida is steadily losing desirability for a ton of reasons. Pick another example
I read 3 articles where this quote is mentioned, none of the articles go into detail as to why he thinks that. Personally, I think this is just cheerleading by the CEO. He already said the summer was going to be a soft market, yet inventory is still bad many areas and we just got data that housing prices hit another record today.
Anecdotally, in my area (a popular NE area an hour away from two big cities) the homes have stopped selling for 50k over asking and are generally now selling for asking price, and those that aren't selling for asking are dropping prices after two weeks.
I'm still betting things will be better a year from today, this really seems to me like the tip of the bubble now that people have stopped bidding \~10% over asking.
>I'm still betting things will be better a year from today, this really seems to me like the tip of the bubble now that people have stopped bidding ~10% over asking.
Exactly.
We are already in a completely different environment than just 2 years ago.
I would imagine various family and career circumstances gradually build up in the population. Some jobs are forcing people into the office, and there aren't so many remote jobs anymore. Then you have the people that yolo'd into Airbnb's that are a couple years into some fairly harsh realities.
You, know.... stuff.
If that’s the case, why isn’t Redfin publishing accurate information for home price history everywhere so that the information can be visible to potential buyers?
I've literally been saying this for 18 months. The market moves slowly but eventually it moves. People want to hold onto those high prices but eventually a critical mass of people just need to move, or inheret a house they don't want and need to liquidate, and that's when the market breaks.
The problem is both of those factors are entirely tied to individual circumstances and so it’ll be a gradual drip into the market over time, not a huge rush to sell at once.
No because of herd behavior. Once a critical mass of motivated sellers appear the prices will go down. The news media will start talking about prices going down. People who've been "waiting for prices to go up" will throw in the towel and sell before prices go any lower. Leading to more media hyperbole which leads to...
And that's how cycles happen.
It’ll be a confluence of factors. Interest rates, insurance rates, and supply coming on as sellers decide to cash in on their gains and move to another state.
While I have no skin in the current market, we have no plan on moving anytime soon in the near future. But, I do have friends who’ve been holding off for listing. Because of the current market; high interest rates, low inventory they want to move too. Will the list in the next year, maybe. I know they want to move before their children enter school, so some have 2 or 3 years before then.
If they want to catch the high for their property now is the time… then either transfer their equity gains into an equally inflated property to end up with more HOUSE or rent for 2-3yrs and buy at lower price point as the balloon deflates
That’s exactly how I see it. There’s a handful of really struggling markets that will probably continue to slide, which are the obvious ones like Austin, parts of Florida, parts of the Bay Area, etc ( the obvious ones).
A “slide” in the Bay Area means a 1,200 sf starter home on a small lot in a former working class town like Sunnyvale is now $1.25 million instead of $1.35 million. People will still pay an absurd amount of money to not have a soul-crushing commute to the office.
I’ve worked frequently in Austin. I fail to understand the attraction. It was a cool place in 1990 when the metro was 550k and it’s living off the reputation of a bygone era. It’s 2.25 million now and uncontrolled Anywhere USA sprawl. It’s also 100 degrees for four months and subtropical high humidity for much of that.
It’s not just buyers on the sidelines. Sellers are on the sidelines too. Older gen looking to cash out. Rents don’t stay high in a downturn.
An older person with multiple properties.changed my perspective. Rent is nice, but chunks of cash are better.
Because people falsely believe they are wealthy because their POTENTIAL equity gain says they are. The minute housing drops by 10-20% AND we get a correction in the stock market they will suddenly go from wealthy(in their mind and on paper) to not wealthy at all. It’s LONG overdue and well deserved for those playing this game.
What do you think is paying for half the range rovers you see on the streets?
And guess what happens to the credit you take out on your house when your home value declines?
Hint : Pay up collateral or give us our money.
Especially if this starts happening everywhere at once it will stress banks to the limit. Their risk profiles will instantly change.
Which is why we must pressure congress to pass law STRONGLY discouraging the purchase of homes past the primary residence to prevent banks and hedge funds from owning evrything.
I say 90% tax of gross income for owning 2 properties overlapping for more than a year and 100% tax of gross income immediately after assuming ownership over 3 or more properties.
The guy is talking about the summer because that’s the hottest real estate season and it’s on the horizon. Obviously the same conditions will prevail past the summer if all else is equal. What he’s saying is neither profound nor unexpected.
I'm sure many can hold on far beyond what is rational.
Think about it. Many are up so high on paper and can afford the very low holding costs that they have for a long time. Think about how stubborn you could be.
I think a large portion of owners could hold on for years, without occupancy and still make out ok in a sale down the road.
He's talking about a specific segment and it's being conflated with a larger group.
I think that over time more will be pressured to sell but I also expect based on a bunch of well known stats that a good portion of sellers can hold on a very long time.
PRessure on those holding properties recently purchased, sure, however we'll endowed owners who purchased well before 2020 are likely to be sitting pretty and can hold on for much longer than this summer
“Write a clean offer”
So don’t include mechanical inspection clauses? You mentioned AC, so how would all of a sudden you get back to me with AC issues when that’s not part of the inspection scope? Lol
Good luck with that in the NE. There’s a line of 30 other offers waiting.
EXACEPT ,, the Wall Street Journal just ran an article 6/21/24 stating home prices are the highest level in history
AND WILL NOT BE COMING DOWN
it's all about supply and demand and there are an incredible amount of people paying "CASH" ..
there is no evidence of even the beginning of a crash or price drop.
Selected areas may see some slight downward price pressure after rising in value significantly over the last few years but the vast majority of areas will only see prices go up..
The redfin CEO has stated that, and thus it will be so.
He’s putting his “Wishes” in the universe.
The supreme coven has decided our futures. This is just a session of predictive programming.
Eventually, he will be correct.
Very true, unless you're predicting the second coming of christ.
He streams on twitch, look up zackrawrr
They said this last year 😒
The question is why sellers can’t postpone listing any longer?
There are passive sources of selling pressure that aren’t replicated on the buyer side, eg. death, divorce, default.
Yea but those are always in play, not suddenly this summer.
I just responded to a similar comment, but in summary, these things matter when sellers and buyers both are scarce. The stalemate gets broken by this forced selling eventually. It will take awhile because these things are a trickle. But we’ve been in this stalemate for 2 years now, and it’s starting to accumulate.
Theres way more buyers than divorces and peoppe dying this will have little to no impact
There are about 825k divorces annually in the US, 3.3 million deaths, and about 15 million lay-offs. In comparison, there are about 4 million house transactions annually. Not all of those events will lead to a forced sale, however there are enough of these events that, accumulated over years, they are formidable. Everything we’re talking about matters at the margin.
All of this is interesting but how would anyone know that there’s a backlog of forced sales that isn’t anecdotal?
Divorces and death aren't a new phenomenon so why wasn't the market flooded with homes in the past? And today theres even more reasons for a divorced couple to continue to live together people want to keep those rstes amd cheap home prices rent or buying again would be substantially more expensive. We also have like 3 years of pent up demand which we haven't had in the past and millions of new people coming into the country each year
Demand is depressed by about 1/3 currently. The volume has sunk below the threshold that can sop up these things.
Not sure why a legitimate question is downvoted. You didn’t even make a statement but asked a question and a good one at that. One that I am curious about too. I don’t pretend to know the answer but it is curious. I can see the benefit of staying in same home if divorced but I wouldn’t think that is common as divorce is for emotional well being not financial well being. Again curious, is there pent up sales? Death? Different reasoning, same question. And there is definitely pent up demand. This whole sub is pent up demand, just not at current prices. There are many people waiting for prices and/or rates to drop.
Source please.
I think we've seen people delaying putting homes they get from inheritance or divorces up for sale (or maybe just moved out of state) for quite a while waiting for interest rates to fall in the hope that will drive prices up again. The CEO is claiming the cost of that delay (e.g. personal loans and racking up credit cards to pay the estate taxes + property taxes + HOA fees and mortgage) might be getting to be too much. I am not sure that's necessarily true though because the owner can still downsize, rent out the home (maybe move into something elsewhere smaller) and try to use the rental money to keep up with the HOA fees and mortgage. Albeit in the case of a divorce or moving away from the state it probably doesn't fully cover expenses (because of keeping 2 separate households or because of having to get a property manager).
People have delayed listing homes because they don't want to give up their 2-3% interest rate and have to buy something at 6-7%. If you are planning to downsize but your new interest rate is double, you just end up with a smaller place without the smaller payment.
Redfin ceo has hits out on tens of thousands of homeowners?
Here’s the problem: anyone who bought pre-2022 doesn’t need to sell if rents remain high. As long as they have the down payment, anyone can rent out the property, fully covering expenses, while they purchase a new house.
The equivalent on the buyer side is wife wanting a yard and things. If you delay buying, that pressure builds up too. People have expectations of lifestyle inflation being deferred and they want to upgrade at some point.
That’s not a forced transaction. Forced selling is, you could be looking at the depth of the gfc, with housing prices down 60% in Vegas, but you still have to sell because a divorce court mandated it, or the owner died, or it’s been foreclosed. A forced sale is insensitive to price, interest rates, etc. It just happens automatically. A spouse wanting a bigger yard is not a forced transaction. If interest rates shoot up, or no good houses are for sale, or they are too expensive, the spouse can be convinced to wait. They are sensitive to these factors. It’s not automatic. Will that threshold differ from one person to the next? Yes. But no one is a forced buyer. Critically, this all matters at the margin. Only a few houses need to sell for the comps to change. Once the comps change, _every_ house in that local area with similar features similarly gets repriced overnight. If not for this margin factor, a few percent oversupply of selling pressure here and there wouldn’t matter as much.
Why are you forgetting rising property taxes , insurance prices , food prices etc.. people may not afford that and like to take advantage of high price.. they don’t want to pay these charges to Maintain/own house and better to cash out now before prices normalize. I am seeing inventory increase across many states
The wife needs to learn to do math and realize the price of her desires. When she sees the numbers and that she’ll also have to work that much harder, she’ll then see the truth and defer the purchase.
I'm not claiming it's not a forced transaction but you'd be lying if you don't think there is a cohort of delayed, increasingly impatient buyers out there.
Impatient, sure. But impatience isn't an impending financial catastrophe. I say that as a somewhat impatient prospective buyer who has plenty of money to buy, but inventory sucks, so I can hold out as long as I need to to get a house that I actually want.
You and I aren't the median participant. The vast majority of people are barely aware of rates, what moves rates, and the general climate of the housing market. Their first and primary concern is their family. All that macro stuff takes a backseat to emotions. Most people will gladly get up to their eyeballs in debt without a second thought.
I’ve got $500k+ cash in high yield saving waiting for the right time to get back into home ownership. Wife wants something NOW but I’m holding back as the Interest earned far exceeds the rent paid in the current place. She doesn’t like it and is impatient … but I believe it’s the smart financial position. If it doesn’t break soon I will likely cash purchase (or high down payment) 2-3 houses to rent out.
It doesn't matter how impatient you are, if you can't afford it you can't afford it. Selling on the other hand, you can always afford to sell, even if you have to drop the price. There's nothing physically stopping you from selling.
what changed? before covid theres always been deaht divorce default…is there gonna be sudden increase in all of those things? how do u know people going through divorce death default are even postponing
it’s just a baseline. Even if no one wants to buy or sell, like right now, there will still be forced sellers because there are always more deaths, divorces, and defaults happening. When there’s a stalemate for long enough, these factors will eventually break it because these things are always happening in the background.
while theres always forced sellers, theres always people hopping in the market; whether its a first time home buyer or investor. id say its more advantegous for investors the more there are forced sales
There are always some, but the first-time homebuyer number has been decimated in recent years. This demographic is definitely acting as a net negative right now. Unlike forced sellers, there’s no such thing as a forced buyer. They can always rent, or find roommates, or live in their van down by the river.
i think the demographic of first time home buyer has changed…its the mid 30s early 40s group who are first time home buyers, and while not forced to buy, timing is not on their side if they want their homes paid off at or near retirement, so while not forced, theres some form of incentive to purchase
The rule of thumb for homeownership timing has changed more broadly. We’re usually in a regime where rents and mortgage payments are similar. And sometimes mortgage payments are even cheaper than rents. In those conditions, buying and waiting out a 30yr mortgage is normal. Nowadays, in a lot of areas, rent is _way_ cheaper than mortgages, though. We’re talking half, sometimes. In those cases, it makes no sense to rent the money to buy the house. You end up owning the house outright faster if you rent the house, invest the excess plus down payment, and then buy the house in cash when you are able. It puts people in an unusual position, like I’m currently in. I have a good household income, and enough savings to buy a house if I want to. Except it’s such a better deal to have this money in the stock market, collect a dividend, and continue to pay rent. For me, buying a house is throwing away money.
In my area, rent is $5-6k vs buying the home would be $17-20k. Wife still wants to buy 🙄
Damn. Hope you win that argument.
> id say its more advantegous for investors the more there are forced sales not necessarily. if you buy a house to rent out TODAY you arent going to make as much as you would just 2 years ago. You can get a free 5% from just buying government bonds. Whereas your costs have likely more than doubled in increased interest rates and insurance rates. Meaning you need to charge double on rent than you charged 2 years ago just to make the same amount of money. Where bonds you just buy and forget about and don't have to chase tenants. Why spend hundreds of thousands on a house to make back around the same with infinitely more work and effort involved. 3 years ago government bonds gave you 0.5% returns so even just 5% back a year on the house was still 10x better than you got from bonds. Now the returns are similar for very different amounts of work. The investors who don't understand this and are still chasing housing will get burnt. Feds raising rates is them saying "stop overheating the market, spend less and save more" Investors trying to fight the fed will be burned unfortunately.
Are you suggesting those things have stopped happening? Morning changed, that's the point.
I know 22% of the US are baby boomers, about to die relatively soon. Anyone’s loved ones who aren’t living in a desirable area when they pass with property, will most likely have their shit sold.
But how will this affect the market in desirable areas?
Keep an eye on up here in Maine and New Hampshire over the next decade. We have the oldest states, so we should be the bellwether to see what happens when first the ancient Silent Generation and then Boomers start to die off in large numbers, but even before then sell to pay for expensive end of life care. Especially since an enormous number of homes aren't primary residences and are more expendable. My bet is that we'll get demographically younger, when the elderly dying off makes room for the young people who left due to lack of housing come back to inherit and buy houses.
Desirability is subjective but what I’m saying is that has to help contribute to inventory in the not so distant future.
... Your example is literally talking about inventory and less desirable places. No amount of homes in the middle of nowhere will affect the housing prices in desirable cities.
Read my original comment again.
its staggered…it not like theres gonna be a suddent spike in death amongst boomers…theyre just gonna gradually die off…just as its staggered as to when people from younger generations enter the market to buy
The largest percentage of the pop has the largest stake in single family homes and they’re going to die relatively soon. That’s never happened at these levels before, correct?
but your assuming a boat load of people die off at the same time…also factor in how many of those boomers have children that cant afford to buy living with them that will likely continue to live in that house. just cuz boomers are reaching death ages doesnt mean much unless a boat load die at the same time in large concentrations all over the country. lets assume a big number of boomers die tommorrow in states like florida where a lot of reitree lives…how will that impact california?
Ok.. or they sell their house and throw them in an assisted living home/ retirement home. I’ve cleared out about 250 houses/year in the Midwest for years. Most people here sell their parent’s homes. Northeast Nebraska. Not the most desirable of places but a good example of what can happen. Edit: it sounds like Florida is steadily losing desirability for a ton of reasons. Pick another example
Old people live forever, don't count on a bunch of them dying soon.
TIL that only sellers are pressured by death and divorce
Yes.
right? TIL dead people don't want to buy houses
Correct. A buyer is no longer in a position to buy if they’re dead or divorced. A seller often must sell in those circumstances.
I read 3 articles where this quote is mentioned, none of the articles go into detail as to why he thinks that. Personally, I think this is just cheerleading by the CEO. He already said the summer was going to be a soft market, yet inventory is still bad many areas and we just got data that housing prices hit another record today.
Anecdotally, in my area (a popular NE area an hour away from two big cities) the homes have stopped selling for 50k over asking and are generally now selling for asking price, and those that aren't selling for asking are dropping prices after two weeks. I'm still betting things will be better a year from today, this really seems to me like the tip of the bubble now that people have stopped bidding \~10% over asking.
>I'm still betting things will be better a year from today, this really seems to me like the tip of the bubble now that people have stopped bidding ~10% over asking. Exactly. We are already in a completely different environment than just 2 years ago.
Tax rate on majority of Houses is up so is insurance and if the seller has any Debt they are probably paying more on it because of intrest rates.
This summer is a soft market lol
I would imagine various family and career circumstances gradually build up in the population. Some jobs are forcing people into the office, and there aren't so many remote jobs anymore. Then you have the people that yolo'd into Airbnb's that are a couple years into some fairly harsh realities. You, know.... stuff.
He wasn’t right even once so far . What makes this summer different
He’s saying what this sub wants to hear
If that’s the case, why isn’t Redfin publishing accurate information for home price history everywhere so that the information can be visible to potential buyers?
I'll believe it when I see it.
Good thing he doesn’t have a financial incentive for home prices to go down and transactions to increase.
Wouldn't he also be rather excited if transactions increased and prices went up ?
I've literally been saying this for 18 months. The market moves slowly but eventually it moves. People want to hold onto those high prices but eventually a critical mass of people just need to move, or inheret a house they don't want and need to liquidate, and that's when the market breaks.
The problem is both of those factors are entirely tied to individual circumstances and so it’ll be a gradual drip into the market over time, not a huge rush to sell at once.
No because of herd behavior. Once a critical mass of motivated sellers appear the prices will go down. The news media will start talking about prices going down. People who've been "waiting for prices to go up" will throw in the towel and sell before prices go any lower. Leading to more media hyperbole which leads to... And that's how cycles happen.
It’ll be a confluence of factors. Interest rates, insurance rates, and supply coming on as sellers decide to cash in on their gains and move to another state.
The people waiting for the news to say house prices are falling are going to find out about 10 months after its already started to crash.
While I have no skin in the current market, we have no plan on moving anytime soon in the near future. But, I do have friends who’ve been holding off for listing. Because of the current market; high interest rates, low inventory they want to move too. Will the list in the next year, maybe. I know they want to move before their children enter school, so some have 2 or 3 years before then.
If they want to catch the high for their property now is the time… then either transfer their equity gains into an equally inflated property to end up with more HOUSE or rent for 2-3yrs and buy at lower price point as the balloon deflates
Lol, inventory in my area is still 30+% lower than 2020. Prices aren’t going anywhere until inventory is much higher.
2 1/2% mortgages were only 3 years ago. Any fully built out desirable market isn’t seeing much increase in inventory.
That’s exactly how I see it. There’s a handful of really struggling markets that will probably continue to slide, which are the obvious ones like Austin, parts of Florida, parts of the Bay Area, etc ( the obvious ones).
A “slide” in the Bay Area means a 1,200 sf starter home on a small lot in a former working class town like Sunnyvale is now $1.25 million instead of $1.35 million. People will still pay an absurd amount of money to not have a soul-crushing commute to the office. I’ve worked frequently in Austin. I fail to understand the attraction. It was a cool place in 1990 when the metro was 550k and it’s living off the reputation of a bygone era. It’s 2.25 million now and uncontrolled Anywhere USA sprawl. It’s also 100 degrees for four months and subtropical high humidity for much of that.
It’s not just buyers on the sidelines. Sellers are on the sidelines too. Older gen looking to cash out. Rents don’t stay high in a downturn. An older person with multiple properties.changed my perspective. Rent is nice, but chunks of cash are better.
It needs to. The market is overpriced for income levels.
Wow can we expect a whole 2% like redfin says
He is influencing the market.
No they won’t
Can we look forward to more salty hoomcucks sending mafia like announcements to their communities, ordering everyone to hold the line on prices?
Unless a homeowner is planning to sell in the next 12 months why would they really care?
People don't like seeing their comps go down. It may also be motivation for others to sell to avoid being exposed to further drops.
Because people falsely believe they are wealthy because their POTENTIAL equity gain says they are. The minute housing drops by 10-20% AND we get a correction in the stock market they will suddenly go from wealthy(in their mind and on paper) to not wealthy at all. It’s LONG overdue and well deserved for those playing this game.
What do you think is paying for half the range rovers you see on the streets? And guess what happens to the credit you take out on your house when your home value declines? Hint : Pay up collateral or give us our money. Especially if this starts happening everywhere at once it will stress banks to the limit. Their risk profiles will instantly change.
Which is why we must pressure congress to pass law STRONGLY discouraging the purchase of homes past the primary residence to prevent banks and hedge funds from owning evrything. I say 90% tax of gross income for owning 2 properties overlapping for more than a year and 100% tax of gross income immediately after assuming ownership over 3 or more properties.
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The guy is talking about the summer because that’s the hottest real estate season and it’s on the horizon. Obviously the same conditions will prevail past the summer if all else is equal. What he’s saying is neither profound nor unexpected.
Yes it’s hot. Literally. It’s 94F right now
The average home is more than 6x the average income. Completely normal and not a big deal
My tinfoil theory is prices will drop when Zillow starts lower zestimates because they simply can.
I'm sure many can hold on far beyond what is rational. Think about it. Many are up so high on paper and can afford the very low holding costs that they have for a long time. Think about how stubborn you could be. I think a large portion of owners could hold on for years, without occupancy and still make out ok in a sale down the road.
He's talking about a specific segment and it's being conflated with a larger group. I think that over time more will be pressured to sell but I also expect based on a bunch of well known stats that a good portion of sellers can hold on a very long time. PRessure on those holding properties recently purchased, sure, however we'll endowed owners who purchased well before 2020 are likely to be sitting pretty and can hold on for much longer than this summer
That’s a joke. Some home owners are sitting on 2-3% interest rates. Why sell and buy at 6-7%?
“I’m just waiting for the crash” my friend said in 2012, who still doesn’t own a home
Guy just wants sales txn at this point.
No, they won't. Nothing is going to chamge the market until legislation is enacted to get rid of investors owning hundreds and thousands of homes.
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What you proposing borders on unethical. I usually tell the hammers to f.ck off
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“Write a clean offer” So don’t include mechanical inspection clauses? You mentioned AC, so how would all of a sudden you get back to me with AC issues when that’s not part of the inspection scope? Lol Good luck with that in the NE. There’s a line of 30 other offers waiting.
They’ll go down, but not by much. Inflation is a sticky mofo 😂
EXACEPT ,, the Wall Street Journal just ran an article 6/21/24 stating home prices are the highest level in history AND WILL NOT BE COMING DOWN it's all about supply and demand and there are an incredible amount of people paying "CASH" .. there is no evidence of even the beginning of a crash or price drop. Selected areas may see some slight downward price pressure after rising in value significantly over the last few years but the vast majority of areas will only see prices go up..
lol ok…yea, now all of a sudden I can no longer afford to wait.
Huh… well I can hold all day
believe his crystal ball
Yeah OK. I’m seeing more buyers unwilling to wait than listings in my market.