Housing crash deniers ???

[Greg R.]

Unfortunately I've been away for a few months while taking care of some personal matters, so I haven't been able to keep up on discussions. 

However, several months ago there were ample amount of folks here insisting that a market crash/ correction was impossible and that prices would only continue to increase.

Curious if there are still people out there who feel this way? If so, I'd love to see some data that supports your view that the market isn't going to crash/ correct. 

[Michael Wooldridge]

Quote from @Greg R.:

Quote from @Michael Wooldridge:

Quote from @Greg R.:

Quote from @Michael Wooldridge:

Quote from @Greg R.:

Quote from @Michael Wooldridge:

Quote from @Greg R.:

Quote from @Carlos Ptriawan:

Austin meanwhile is much more consistent in the trend up and down:

https://www.redfin.com/city/30...

And I think we all honestly thought Austin would be worse than DFW in the shift given prices, tech buble and a few other things. 

on the other hand June to June in DFW was a 30% growth year over year. That’s an insane jump so maybe that was it more than anything. 

I will say I’m shocked DF had more shift then Austin but if not for that odd May jump that was no in trend with tthe previous shift. 

Either way not seeing the 20-30% jump nationally. 

Austin is not far behind... Peak of the bubble median sold house was 670k (May), in September it was 563k, over 100k. That's a lot more than a minor correction. That's a major shift in values. If this rate of value decreases continues for a few more months, you are going to see your 20-30%. 

And again, you seem to be hung up on the idea that in order for prices to crash, it will be immediate. We're a little more than one quarter past the peak of the bubble, we're seeing exactly what I am predicting. Slow and steady declines. 

 Austin is in line with what you would expect to see. in fact lets compare: 

So again not comparable to DFW at all. I'm focus on that very odd bubble in DFW that immediately jumped 17% more than Austin. So yes look like a very odd and  isolated bubble. But let's not be honest at all about it. no I'm not looking at short term trends. 

Austin is in line with what I would expect. one of the largest markets 16% swing from the peak to Sept. And a market far over the median home average nationally. Also looks to be flatlining a bit like Cali. 

Time will tell but you picked two of the most extreme markets and if you adjust for the abnormal DFW bubble it doesn't look like an outlier either.  But sure 20% plus national adjustments here we come.... 

[Tim Hall]

@Greg R. I went through the 2008-9 crash. This in comparison is a blip, a bli maybe even a b. I had a house that appraised in Sarasota Florida that appraised for $310k and I couldn’t sell it 6 months later for $65k. Many people bought lots in town for $70k and ended up selling them for under $10k so they could get a capital loss. Things have slowed down not shut down. Money is still being loaned. Try getting a bank loan back then. No banks would touch real estate. Hard money was high as can be if you could get one. I suppose I’m a denier but ho hum.

[Chris John]

I'm not sure that median month over month prices is necessarily a fair barometer of the market.  I'd go more for price per square foot.  

It makes a lot of sense to me that the first people to not bother listing their houses would be the wealthy as their houses just got inordinately expensive on a monthly basis.  I'm not saying that we're not seeing a drop in housing prices in general, just that median price could easily be compromised by a shift to a larger percent of the market being made up with lower cost housing.  

[Greg R.]

Quote from @Tim Hall:

@Greg R. I went through the 2008-9 crash. This in comparison is a blip, a bli maybe even a b. I had a house that appraised in Sarasota Florida that appraised for $310k and I couldn’t sell it 6 months later for $65k. Many people bought lots in town for $70k and ended up selling them for under $10k so they could get a capital loss. Things have slowed down not shut down. Money is still being loaned. Try getting a bank loan back then. No banks would touch real estate. Hard money was high as can be if you could get one. I suppose I’m a denier but ho hum.

Sorry to hear about your misfortunes in FL Tim. I'm not personally familiar with the FL market, but according to the recorded historical transactions, the median home price in Sarasota county at the top of the bubble was 225k, and when the market crashed the low point was 114k. Which was obviously a massive crash, around 49%. However, you describing a 310k property not being able to sell for 65k, which represents an 80% decrease in value. But you're saying that you couldn't even get that? So what happened to the property, foreclosure? 

What exactly was the issue with lending? Was is that you were accustomed to getting no doc loans, or 100+% LTV loans and those products dried up?

According to data from the Home Mortgage Disclosure Act, there seemed to be plenty of lending going on during and after the crash. 

[John Carbone]

Quote from @Greg R.:

Quote from @Tim Hall:

@Greg R. I went through the 2008-9 crash. This in comparison is a blip, a bli maybe even a b. I had a house that appraised in Sarasota Florida that appraised for $310k and I couldn’t sell it 6 months later for $65k. Many people bought lots in town for $70k and ended up selling them for under $10k so they could get a capital loss. Things have slowed down not shut down. Money is still being loaned. Try getting a bank loan back then. No banks would touch real estate. Hard money was high as can be if you could get one. I suppose I’m a denier but ho hum.

Sorry to hear about your misfortunes in FL Tim. I'm not personally familiar with the FL market, but according to the recorded historical transactions, the median home price in Sarasota county at the top of the bubble was 225k, and when the market crashed the low point was 114k. Which was obviously a massive crash, around 49%. However, you describing a 310k property not being able to sell for 65k, which represents an 80% decrease in value. But you're saying that you couldn't even get that? So what happened to the property, foreclosure? 

What exactly was the issue with lending? Was is that you were accustomed to getting no doc loans, or 100+% LTV loans and those products dried up?

According to data from the Home Mortgage Disclosure Act, there seemed to be plenty of lending going on during and after the crash. 

this was from lennar earnings report. I know we have bulls here from Philly and minnesotta….what is it a national home builder sees that you all aren’t?

[Jordan Moorhead]

@John Carbone where can I find the Lennar Earnings report? I'd love to see that! 

Haven't chimed in here in a while. I operate in 4 markets. Austin, Minneapolis-Saint Paul, Louisville and San Antonio.

In Austin and Minneapolis we mostly broker although I do personally buy in Austin.

In Louisville and San Antonio we buy and hold. 

In the prior 2 markets I've seen a significant softening, more pronounced in Austin than MSP. I believe that's because of the median price points of both. Austin is more severely affected by expensive debt.

In the latter I have only seen a minor slow down, if any at all. My father is still a Realtor in Louisville also and has recently sold a few listings at what I think are ridiculous prices for the homes. It seems as if these markets haven't felt too much of anything yet. The hard part is that these are what people would traditionally refer to as "cashflow" markets. With the rising debt costs and prices holding firm cashflow is harder and harder to find. It was already extremely difficult.

IMO we will see the more expensive, speculative markets take the biggest decreases. The middle markets I don't think will see anywhere near that. Most sellers don't have to sell and have extremely cheap mortgages, it's important to remember that. Because of that I don't believe we'll see the flood of inventory needed to spur a massive drop in prices. In Austin we're still having homes sell and close to list price at that, it's just taking a lot longer than everyone wants. Even if we end up 20-30% off peak prices in most every market that puts us back at 2019 prices. Can you call that a crash?

[Michael Wooldridge]

Quote from @John Carbone:

Quote from @Greg R.:

Quote from @Tim Hall:

@Greg R. I went through the 2008-9 crash. This in comparison is a blip, a bli maybe even a b. I had a house that appraised in Sarasota Florida that appraised for $310k and I couldn’t sell it 6 months later for $65k. Many people bought lots in town for $70k and ended up selling them for under $10k so they could get a capital loss. Things have slowed down not shut down. Money is still being loaned. Try getting a bank loan back then. No banks would touch real estate. Hard money was high as can be if you could get one. I suppose I’m a denier but ho hum.

Sorry to hear about your misfortunes in FL Tim. I'm not personally familiar with the FL market, but according to the recorded historical transactions, the median home price in Sarasota county at the top of the bubble was 225k, and when the market crashed the low point was 114k. Which was obviously a massive crash, around 49%. However, you describing a 310k property not being able to sell for 65k, which represents an 80% decrease in value. But you're saying that you couldn't even get that? So what happened to the property, foreclosure? 

What exactly was the issue with lending? Was is that you were accustomed to getting no doc loans, or 100+% LTV loans and those products dried up?

According to data from the Home Mortgage Disclosure Act, there seemed to be plenty of lending going on during and after the crash. 

this was from lennar earnings report. I know we have bulls here from Philly and minnesotta….what is it a national home builder sees that you all aren’t?

John this is sort of an odd tree to be climbing. One of the arguments most of us have made on this side is that inventory would stay low? Why because builders had stopped and people with rates wouldn’t move. I specifically called out builders had stopped applying to build new homes awhile ago. 

And Philly metro will be slow. Philly metro hasn’t grown much last few years even (fishtown and some of those areas). So not surprising. Philly suburbs thought have quite a few active builders with Toll to THP to Pulte. Suburbs are selling quite well 

[James Hamling]

Quote from @John Carbone:

Quote from @James Hamling:

Quote from @John Carbone:

@James Hamling seems like my call is coming right on que here. Seasonal adjustments claims are proving to be a myth. Short term 12-18 month 20-30 percent drops and then prices skyrocket higher like you claim, you are just a year to two too early . 

 Well, let's see who's forecasting better matches the reality that comes. 

Remember in my forecast I have a running commentary of the Lynch-pin Theory that goes along, which none of these fancy charts and analysis you pull from take into account. These things your looking at are a very small select data segment, and then projects it forward in a kind of tunnel vision. Which is why they are so wildly inaccurate the further out they view, and have such sizable changes so consistently. 

As I have said, watch for policy actions of interdiction in the next 8-12 mnths now to effect some kind of "affordability in housing". It will be coming, without doubt. 

As for the "crash" you keep calling for, need I remind it only exists in your charts, still, not in reality. You've been calling for a "crash" for weeks, and it doesn't happen. It's continued to be something "just around the corner", consistently.     20-30% drop in national median home prices is just NOT a realistic thing, it's not, and there is a mountain of data to prove such. Just do some research on '08', because what your calling for is on same level if not bigger, FYI. It's easy to call it out as NOT viable. 

I’ve never referred it as a “crash”, all I’m saying 20-30 percent from peak by end of 2023. I don’t like using that term because stocks dropped 20-30 percent since January but it’s not a “crash” because it’s not instantaneous. Expect similar to stock market with housing by end of 2023, I don’t care what the official definition is, “crash” “correction” “draw down” just 20-30 percent by Dec 31 2023, off the peak median home value nationwide. 

 Todays announcement by POTUS Admin. seems to be moving straight line in direction as I have indicated; moronic economic medaling. 

Was watching on CNN, and even they (CNN) were confused by the actions of both pumping out more from strategic reserves at same time as saying there going to do buy-back plan for strategic reserves. Lol. So, even that political wing is looking at itself saying "Dud, WTF, seriously? Do you hear yourself? You make 0 sense, WTF, make this make sense",       So it begins, the actions to fluff things at same time as actions to address things, which will negate each other and we enter a wildly Bi-polar economic period. 

So with that in mind, protraction of things is going to happen, and is now happening live-time.    That will lead to the necessity for greater "fluff" actions which will lead to the only available "fluff" action, BORROWING ones way to "affordability". Just think on it, how else does one create an affordability when the very policy actions are causing higher prices? As we see there is 0 will to actually address fundamental issues.        For example there saying that they want oil to produce more, yet there not doing the easiest thing of reinstating Dakota Access Pipeline deal which would add 500k barrels per day in the swipe of a pen. They think we-the-people are too dumb to see through there BS, and in large part there right, those chugging from the Kool-Aid-Bowl are too brainwashed to think for selves and see any of it, there just regurgitating talking points without an iota of self-thought.       But it's obvious, they want to appear as addressing things, without actually doing anything. 

Anyone who knows anything about the oil industry knows there's not a speed control where they can just send out a person to "turn-up" a dial on an oil derrick. No, it doesn't work that way. To ADD production is via adding more production well heads. Meaning, drilling. That's expensive, and nobody is stupid enough to do it when there is 0 return for that expense. It means more rapidly depleting existing fields, so your only trading time not actually ADDING production, or opening up NEW un-tapped production which as most of us know, is not currently allowed.     So it's out-right BS there spewing. And they know it, there just betting most don't. 

So, yes, hello Stagflation here we come! 

[James Hamling]

Quote from @Michael Wooldridge:

Quote from @John Carbone:

Quote from @Greg R.:

Quote from @Tim Hall:

@Greg R. I went through the 2008-9 crash. This in comparison is a blip, a bli maybe even a b. I had a house that appraised in Sarasota Florida that appraised for $310k and I couldn’t sell it 6 months later for $65k. Many people bought lots in town for $70k and ended up selling them for under $10k so they could get a capital loss. Things have slowed down not shut down. Money is still being loaned. Try getting a bank loan back then. No banks would touch real estate. Hard money was high as can be if you could get one. I suppose I’m a denier but ho hum.

Sorry to hear about your misfortunes in FL Tim. I'm not personally familiar with the FL market, but according to the recorded historical transactions, the median home price in Sarasota county at the top of the bubble was 225k, and when the market crashed the low point was 114k. Which was obviously a massive crash, around 49%. However, you describing a 310k property not being able to sell for 65k, which represents an 80% decrease in value. But you're saying that you couldn't even get that? So what happened to the property, foreclosure? 

What exactly was the issue with lending? Was is that you were accustomed to getting no doc loans, or 100+% LTV loans and those products dried up?

According to data from the Home Mortgage Disclosure Act, there seemed to be plenty of lending going on during and after the crash. 

this was from lennar earnings report. I know we have bulls here from Philly and minnesotta….what is it a national home builder sees that you all aren’t?

John this is sort of an odd tree to be climbing. One of the arguments most of us have made on this side is that inventory would stay low? Why because builders had stopped and people with rates wouldn’t move. I specifically called out builders had stopped applying to build new homes awhile ago. 

And Philly metro will be slow. Philly metro hasn’t grown much last few years even (fishtown and some of those areas). So not surprising. Philly suburbs thought have quite a few active builders with Toll to THP to Pulte. Suburbs are selling quite well 

 John does not understand how excellent builder-developers have been the last decade at inventory control. 

First of all, viewing developer units is NOT a correct way to view things because that inventory is NOT always IMPROVED units. A developers "units" could be build ready lots, platted lots, improved lots as in with units on them, and any compilation of all of the above.     

I actually work with these developer-builders, so I can give real world factual data. For example, my main one, who is a major developer-builder, has ~ 1,200 "units" today, of which less then 100 have actual structures built or in construction phase on them now. Yet, ~400 units are in sales inventory BECAUSE what a developer-builder does is PRE-selling units, as in marketed and sold before any construction is initiated.     This is a very standard inventory control. For the very specific reason of mitigated risk exposure.     They can readily throttle units too market sales velocity.    

That is exactly what your going to see int he data today, builder-developers turning down the velocity of builds to match market sales velocity. 

As for sitting on lot's, it's a nothing burger for developer-builders, they sit on land for years as part of business as usual, as it's very cheap to do so. Ask anyone in the land flipping game. 

So this mirage that builder-developers are some how going to get into a pinch like '09' of having countless units sitting empty, it's ignorance, it just does not work that way anymore BECAUSE of '09'. The way those development funds work is different, inventory control is different. 

Yes, SPEC Builders may get caught hot-potato, but those are SPEC builders, there a very small % of the new unit market. The average Spec builder has as many as a handful of units built at any given time. 

This is the reality of it. From a person actually IN the developments WITH the builder-developers at this time.     If anything, the next action is the 2/1 buydown, that's just starting to get played with. And buyers are starting to engage with it.     And as total R.E. market velocity keeps dropping, we are going to see more build-4-rentals happening.     Because rental rates are going to strengthen more and more as home sales volume drops. 

[James Hamling]

Quote from @Michael Wooldridge:

@Greg R. sorry but any way you slice it it's weird. Month over month it's unusually large and if you specifically look at it from March to May it's a massive jump, even in this environment. Candidly it wouldn't be surprising to find you had a very large influx of population specifically in May (with some houses closing in April) and then immediately trailing back down. Those jumps are massive any way you slice it and unusually from the entire previous trend. In fact. It's pretty much flat lined from where it was in Mach/April range. Which even on it's own suggests a bit of an isolated incident there.

@Carlos Ptriawan I'd love to know if there was a big company move about that time to DFW. Because even from the historical numbers those are big jumps and yes looks like a large influx from Cali tied to a large business move. 

Either way it doesn't match the Austin trend. And its also flatlined.... 

 FB did issue out a requirement for return to offices, in Austin, to start around May/June. I had clients who had to relocate back, not saying this is "it" but could be a factor. 

[Bruce Woodruff]

Just saw a TV news story about the FED pretty much promising a 'large rate hike' soon......

[John Carbone]

Quote from @Jordan Moorhead:

@John Carbone where can I find the Lennar Earnings report? I'd love to see that! 

Haven't chimed in here in a while. I operate in 4 markets. Austin, Minneapolis-Saint Paul, Louisville and San Antonio.

In Austin and Minneapolis we mostly broker although I do personally buy in Austin.

In Louisville and San Antonio we buy and hold. 

In the prior 2 markets I've seen a significant softening, more pronounced in Austin than MSP. I believe that's because of the median price points of both. Austin is more severely affected by expensive debt.

In the latter I have only seen a minor slow down, if any at all. My father is still a Realtor in Louisville also and has recently sold a few listings at what I think are ridiculous prices for the homes. It seems as if these markets haven't felt too much of anything yet. The hard part is that these are what people would traditionally refer to as "cashflow" markets. With the rising debt costs and prices holding firm cashflow is harder and harder to find. It was already extremely difficult.

IMO we will see the more expensive, speculative markets take the biggest decreases. The middle markets I don't think will see anywhere near that. Most sellers don't have to sell and have extremely cheap mortgages, it's important to remember that. Because of that I don't believe we'll see the flood of inventory needed to spur a massive drop in prices. In Austin we're still having homes sell and close to list price at that, it's just taking a lot longer than everyone wants. Even if we end up 20-30% off peak prices in most every market that puts us back at 2019 prices. Can you call that a crash?

Agree with what you say here. 20-30 percent drop I’ve been calling for isn’t a “crash”, I’ve always said we will be back to 2019 prices and everything will be fine (except most buyers in 2021-2022)

my whole point in all of this, is that contrary to realtor 101 “now is not the time to buy” it hasn’t been for a few months. Momentum has shifted and a buyer will not be worse off waiting a year to buy. Very high probability if they wait they will be better off. This is the first time in a decade where this is true, but it is now. 

[James Hamling]

Quote from @Bruce Woodruff:

Just saw a TV news story about the FED pretty much promising a 'large rate hike' soon......

 This impending rate hike has been a known item of expectation for some time now https://www.reuters.com/market... 

There is a general belief that the market has already factored in another 75 basis point increase. Question is where it will land in relation, will it be 75, 50 or 100? 

There is many speaking out now, the significance of such like Carl Icahn, basically saying this whole thing of raising rates and inflations goes away, is not working, will not work, and is just protracting and inducing much more pain. AND calling for the "safe" placement of capital to be, you guessed it ASSETS. Maybe not by exact name but sure as heck by descriptions. Pointing out things like energy production, because it's a factual thing, of use, that price will rise with inflation, food, and shelter. Again, assets as hedge against inflation and Real Estate being KING in that regard.     

When these investors talk about a stock such a "O" being a safe placement, because it operates leases with Walgreens, and medical services are a necessity there in setting those tenants as gold-standard, and servicing those leases as great investment, what they are saying is "Real Estate is THE safe bet", just in a longer narrative of such. 

Let's go back to the 80's, how was it then? Real Estate prices sure as heck didn't fall off a cliff, inflation was not making home ownership cheaper by any stretch of the imagination, it was the age of the renter right.    

This inflation thing is NOT going away any time soon. This is the beginning. And at the pace of things U.S. is going to probably be on some form of war footing very soon. That means a war-time production economy, which is inflationary itself. If we cut certain international imports, meeting such demand domestically, again inflationary actions. We have a tight labor market, more labor demand means wage inflation not to mention more $ in worker class which leads to more consumer spending and round n round this fun ride goes. 

End of story is we printed biz-onkers amount of capital into the system, that is not going to easily, rapidly or simply going to go away any time soon. There is no escaping that fundamental fact no matter what BS anyone wants to throw at it. You simply can't print TRILLIONS into existence and not suffer inflations wrath.    They tried saying inflation was on vacation, then they said inflation is a hobo passing through town, then that inflation can be eliminated with a few pop's of interest rates....... Either they are clueless or just out right full of sh#t, period end of story. How many times do they need to be blatantly wrong before people wise-up?     

This will not end soon, yester-years prices are not returning. Get ready, this is 80's 2.0. Know how we made things more affordable in 80's? K-cars, which is basically some tinfoil on a popsicle stick chassis with a lawn mower engine. We ate ramen, TONS of ramen. Double, triple jobs. People didn't splurge, $ went to rent, food and what was left went to what was left.    And you saved, saved, saved hoping to get approved for that mortgage at 14.4% and were dang-happy when you got it, you bragged about it.    

Life did not stop, we didn't all walk out, dig a grave and throw ourselves into it. People didn't give away homes for whatever someone would pay. I get the fear and panic of those who didn't experience the 80's, who think it's some distant place in a time long, long ago, because for most part you had a silver spoon firmly planted in your behind your whole life. For the rest of us, we've seen this before, we lived through it, and worse. We had this inflation PLUS a cold war, nuke drills at school, it was just a Tuesday, lol.     

[Victor S.]

Quote from @James Hamling:

 Todays announcement by POTUS Admin. seems to be moving straight line in direction as I have indicated; moronic economic medaling. 

Was watching on CNN, and even they (CNN) were confused by the actions of both pumping out more from strategic reserves at same time as saying there going to do buy-back plan for strategic reserves. Lol. So, even that political wing is looking at itself saying "Dud, WTF, seriously? Do you hear yourself? You make 0 sense, WTF, make this make sense",       So it begins, the actions to fluff things at same time as actions to address things, which will negate each other and we enter a wildly Bi-polar economic period. 

So with that in mind, protraction of things is going to happen, and is now happening live-time.    That will lead to the necessity for greater "fluff" actions which will lead to the only available "fluff" action, BORROWING ones way to "affordability". Just think on it, how else does one create an affordability when the very policy actions are causing higher prices? As we see there is 0 will to actually address fundamental issues.        For example there saying that they want oil to produce more, yet there not doing the easiest thing of reinstating Dakota Access Pipeline deal which would add 500k barrels per day in the swipe of a pen. They think we-the-people are too dumb to see through there BS, and in large part there right, those chugging from the Kool-Aid-Bowl are too brainwashed to think for selves and see any of it, there just regurgitating talking points without an iota of self-thought.       But it's obvious, they want to appear as addressing things, without actually doing anything. 

Anyone who knows anything about the oil industry knows there's not a speed control where they can just send out a person to "turn-up" a dial on an oil derrick. No, it doesn't work that way. To ADD production is via adding more production well heads. Meaning, drilling. That's expensive, and nobody is stupid enough to do it when there is 0 return for that expense. It means more rapidly depleting existing fields, so your only trading time not actually ADDING production, or opening up NEW un-tapped production which as most of us know, is not currently allowed.     So it's out-right BS there spewing. And they know it, there just betting most don't. 

So, yes, hello Stagflation here we come! 

 those votes ain't gonna buy themselves, James! 

[Carlos Ptriawan]

Quote from @James Hamling:

This inflation thing is NOT going away any time soon. This is the beginning. And at the pace of things U.S. is going to probably be on some form of war footing very soon. That means a war-time production economy, which is inflationary itself. If we cut certain international imports, meeting such demand domestically, again inflationary actions. We have a tight labor market, more labor demand means wage inflation not to mention more $ in worker class which leads to more consumer spending and round n round this fun ride goes. 

Nah, it was not that bad. There're more independent analyses showing CPI going to be under 5% within 6-8 months.
I think by now I understand what's going on. The data that Fed uses is so lagging. 

Inflation already peaked. PPI decreasing. Food items as of today already decreasing.

[Carlos Ptriawan]

Quote from @John Carbone:

Agree with what you say here. 20-30 percent drop I’ve been calling for isn’t a “crash”, I’ve always said we will be back to 2019 prices and everything will be fine (except most buyers in 2021-2022)

my whole point in all of this, is that contrary to realtor 101 “now is not the time to buy” it hasn’t been for a few months. Momentum has shifted and a buyer will not be worse off waiting a year to buy. Very high probability if they wait they will be better off. This is the first time in a decade where this is true, but it is now. 

 If Fed already said 30YRFRM would be 4-5% in 2024 and Opendoor is saying they will make record revenue in 2024 , why do we need to buy now right. Just wait until everything is settled. We don't need to rush. The risk that we face is actually if we see unexpected event to happen like another Lehman moment or China invasion, things like that.... but if things stay normal it's prudent to revisit the real estate market in 2023/2024.

[John Carbone]

Quote from @Carlos Ptriawan:

Quote from @John Carbone:

Agree with what you say here. 20-30 percent drop I’ve been calling for isn’t a “crash”, I’ve always said we will be back to 2019 prices and everything will be fine (except most buyers in 2021-2022)

my whole point in all of this, is that contrary to realtor 101 “now is not the time to buy” it hasn’t been for a few months. Momentum has shifted and a buyer will not be worse off waiting a year to buy. Very high probability if they wait they will be better off. This is the first time in a decade where this is true, but it is now. 

 If Fed already said 30YRFRM would be 4-5% in 2024 and Opendoor is saying they will make record revenue in 2024 , why do we need to buy now right. Just wait until everything is settled. We don't need to rush. The risk that we face is actually if we see unexpected event to happen like another Lehman moment or China invasion, things like that.... but if things stay normal it's prudent to revisit the real estate market in 2023/2024.

5-10 years from now, nobody is going to say “oh I wish I bought when rates went parabolic to 7 percent, missed out on opportunity of a lifetime”…….it will be more like this “I’m glad I waited 12-18 months to let the dust settle from the parabolic rates..I scored a great deal and refinanced a year later and now I’m sitting on massive fed induced equity”  

Btw, 10 year t-bill is over 4.10 percent now today….equity markets going to finally notice?

[Greg R.]

Quote from @Carlos Ptriawan:

Quote from @James Hamling:

This inflation thing is NOT going away any time soon. This is the beginning. And at the pace of things U.S. is going to probably be on some form of war footing very soon. That means a war-time production economy, which is inflationary itself. If we cut certain international imports, meeting such demand domestically, again inflationary actions. We have a tight labor market, more labor demand means wage inflation not to mention more $ in worker class which leads to more consumer spending and round n round this fun ride goes. 

Nah, it was not that bad. There're more independent analyses showing CPI going to be under 5% within 6-8 months.
I think by now I understand what's going on. The data that Fed uses is so lagging. 

Inflation already peaked. PPI decreasing. Food items as of today already increasing.

Carlos, I really don't know where this data is coming from, but in real-life I'm in grocery stores 2x a week, prices are not decreasing at all. At least not in Dallas, and according to my parents, not in SD either. 

[James Hamling]

Quote from @Victor S.:

Quote from @James Hamling:

 Todays announcement by POTUS Admin. seems to be moving straight line in direction as I have indicated; moronic economic medaling. 

Was watching on CNN, and even they (CNN) were confused by the actions of both pumping out more from strategic reserves at same time as saying there going to do buy-back plan for strategic reserves. Lol. So, even that political wing is looking at itself saying "Dud, WTF, seriously? Do you hear yourself? You make 0 sense, WTF, make this make sense",       So it begins, the actions to fluff things at same time as actions to address things, which will negate each other and we enter a wildly Bi-polar economic period. 

So with that in mind, protraction of things is going to happen, and is now happening live-time.    That will lead to the necessity for greater "fluff" actions which will lead to the only available "fluff" action, BORROWING ones way to "affordability". Just think on it, how else does one create an affordability when the very policy actions are causing higher prices? As we see there is 0 will to actually address fundamental issues.        For example there saying that they want oil to produce more, yet there not doing the easiest thing of reinstating Dakota Access Pipeline deal which would add 500k barrels per day in the swipe of a pen. They think we-the-people are too dumb to see through there BS, and in large part there right, those chugging from the Kool-Aid-Bowl are too brainwashed to think for selves and see any of it, there just regurgitating talking points without an iota of self-thought.       But it's obvious, they want to appear as addressing things, without actually doing anything. 

Anyone who knows anything about the oil industry knows there's not a speed control where they can just send out a person to "turn-up" a dial on an oil derrick. No, it doesn't work that way. To ADD production is via adding more production well heads. Meaning, drilling. That's expensive, and nobody is stupid enough to do it when there is 0 return for that expense. It means more rapidly depleting existing fields, so your only trading time not actually ADDING production, or opening up NEW un-tapped production which as most of us know, is not currently allowed.     So it's out-right BS there spewing. And they know it, there just betting most don't. 

So, yes, hello Stagflation here we come! 

 those votes ain't gonna buy themselves, James! 

 1,ooo%! Victor get's it! 

[John Carbone]

Quote from @Greg R.:

Quote from @Carlos Ptriawan:

Quote from @James Hamling:

This inflation thing is NOT going away any time soon. This is the beginning. And at the pace of things U.S. is going to probably be on some form of war footing very soon. That means a war-time production economy, which is inflationary itself. If we cut certain international imports, meeting such demand domestically, again inflationary actions. We have a tight labor market, more labor demand means wage inflation not to mention more $ in worker class which leads to more consumer spending and round n round this fun ride goes. 

Nah, it was not that bad. There're more independent analyses showing CPI going to be under 5% within 6-8 months.
I think by now I understand what's going on. The data that Fed uses is so lagging. 

Inflation already peaked. PPI decreasing. Food items as of today already increasing.

Carlos, I really don't know where this data is coming from, but in real-life I'm in grocery stores 2x a week, prices are not decreasing at all. At least not in Dallas, and according to my parents, not in SD either. 

Not seeing it either. Used to spend around $200 every 2 weeks at grocery. It was in the $300s last year and now it’s approaching $400 and everyone weighs the same. 

the way they calculate food inflation is hedonics with “substitutes” that’s aren’t really like kind substitutes.

went to chipotle first time in a while and im at $20 for a burrito and a soft drink. That used to be $13 for me. 

I’ve been calling for early 2024 real estate rebound from day 1 he 

[Carlos Ptriawan]

Quote from @Michael Wooldridge:

Quote from @John Carbone:

Quote from @Greg R.:

Quote from @Tim Hall:

@Greg R. 

And Philly metro will be slow. Philly metro hasn’t grown much last few years even (fishtown and some of those areas). So not surprising. Philly suburbs thought have quite a few active builders with Toll to THP to Pulte. Suburbs are selling quite well 

 Zillow prediction for the next 12 months is out, it's pretty much flat line or 1% growth til Sep 2023 nationwide. This is the most accurate and realistic view that I've seen. Philly is growing like 1% for 2023. 

So no market crash --per Zillow.

If it would be a flat line til Q3 2023 then Opendoor is right,market would re-accelerate from early 2024.

[Bruce Woodruff]

Quote from @Greg R.:

A lot of people on this forum just use graphs/charts/rates that some computer kid fresh outta college developed without questioning them. They may or may not have any basis in reality. Most don't. And a move downward this week (perceived) could result in the worst inflation or recession, take your pick, that we have ever seen.
There are zero statistics that mean anything any more. Zero.

[Greg R.]

Quote from @John Carbone:

Quote from @Greg R.:

Quote from @Carlos Ptriawan:

Quote from @James Hamling:

This inflation thing is NOT going away any time soon. This is the beginning. And at the pace of things U.S. is going to probably be on some form of war footing very soon. That means a war-time production economy, which is inflationary itself. If we cut certain international imports, meeting such demand domestically, again inflationary actions. We have a tight labor market, more labor demand means wage inflation not to mention more $ in worker class which leads to more consumer spending and round n round this fun ride goes. 

Nah, it was not that bad. There're more independent analyses showing CPI going to be under 5% within 6-8 months.
I think by now I understand what's going on. The data that Fed uses is so lagging. 

Inflation already peaked. PPI decreasing. Food items as of today already increasing.

Carlos, I really don't know where this data is coming from, but in real-life I'm in grocery stores 2x a week, prices are not decreasing at all. At least not in Dallas, and according to my parents, not in SD either. 

Not seeing it either. Used to spend around $200 every 2 weeks at grocery. It was in the $300s last year and now it’s approaching $400 and everyone weighs the same. 

the way they calculate food inflation is hedonics with “substitutes” that’s aren’t really like kind substitutes.

went to chipotle first time in a while and im at $20 for a burrito and a soft drink. That used to be $13 for me. 

Yup, this is across the board. At subway the footlong that I get was $7 not long ago, now it's $11. I'm not surprised that some gov agency would try to conjure up some BS "data" to make it appear that costs are going down. Spent over $500 at Costco this weekend alone. Spent another $120 at Sprouts on produce. In all fairness, probably about $150 of Costco wasn't food, but even then we're over $400 on the week for food (family of 4). 

A lot of people aren't talking about "shrinkflation" either. The gov is prob claiming that a box of cereal, roll of TP, or paper towels costs "x", but they are not mentioning that the sizes/ quantiles of good is decreasing as well. Costco was caught doing this with their Kirkland brand of toilet paper. Wouldn't be surprised if they start referring to milk as a large container instead of a gallon and shave it down to 110-120 ounces. 

[Greg R.]

Quote from @Carlos Ptriawan:

Quote from @Michael Wooldridge:

Quote from @John Carbone:

Quote from @Greg R.:

Quote from @Tim Hall:

@Greg R. 

And Philly metro will be slow. Philly metro hasn’t grown much last few years even (fishtown and some of those areas). So not surprising. Philly suburbs thought have quite a few active builders with Toll to THP to Pulte. Suburbs are selling quite well 

 Zillow prediction for the next 12 months is out, it's pretty much flat line or 1% growth til Sep 2023 nationwide. This is the most accurate and realistic view that I've seen. Philly is growing like 1% for 2023. 

So no market crash --per Zillow.

If it would be a flat line til Q3 2023 then Opendoor is right,market would re-accelerate from early 2024.

Since when is Zillow the know-all? I must have seen hundreds of examples that have shown Zillow projections to be way off. I need a little more to convince me otherwise - at least in my local area. In different localities, sure. In DWF area & Austin prices are dropping quick. Everything is more expensive than ever (including mortgage rates). 

[James Hamling]

Quote from @John Carbone:

Quote from @Carlos Ptriawan:

Quote from @John Carbone:

Agree with what you say here. 20-30 percent drop I’ve been calling for isn’t a “crash”, I’ve always said we will be back to 2019 prices and everything will be fine (except most buyers in 2021-2022)

my whole point in all of this, is that contrary to realtor 101 “now is not the time to buy” it hasn’t been for a few months. Momentum has shifted and a buyer will not be worse off waiting a year to buy. Very high probability if they wait they will be better off. This is the first time in a decade where this is true, but it is now. 

 If Fed already said 30YRFRM would be 4-5% in 2024 and Opendoor is saying they will make record revenue in 2024 , why do we need to buy now right. Just wait until everything is settled. We don't need to rush. The risk that we face is actually if we see unexpected event to happen like another Lehman moment or China invasion, things like that.... but if things stay normal it's prudent to revisit the real estate market in 2023/2024.

5-10 years from now, nobody is going to say “oh I wish I bought when rates went parabolic to 7 percent, missed out on opportunity of a lifetime”…….it will be more like this “I’m glad I waited 12-18 months to let the dust settle from the parabolic rates..I scored a great deal and refinanced a year later and now I’m sitting on massive fed induced equity”  

Btw, 10 year t-bill is over 4.10 percent now today….equity markets going to finally notice?

 I couldn't disagree more strongly. 

For last 2 years I have heard a constant chorus of people saying "oh man, I was waiting for this collapse and stupid me, I SHOULD HAVE JUMPED ON BUYING but I thought things were too hot and I listened to stupid YT's saying it was all gonna crash".      

Because here is the thing; when you go to buy a home to live in it, it's value is priced on comp method right. BUT when it's for business purposes, for investment, it's on a FINANCIAL method. With that, higher rents, higher NOI = HIGHER prices to buy. Did rents go up these last months, heck yeah! And what happened, no people crying about how they can't find any multi-deals right. How everything is "too tight". But if they bought just 18 months ago let's say, when things were scorching hot, they said same thing then BUT that sold price then today = great performance, because rents-went-up.

And guess what this inflation and lower volume does, rents will go UP. Up up up until only incomes caps them. As incomes go up so will those rent caps. 

So yeah, in years to come YES 100% people will say "oh man, I SHOULDA BOUGHT back when" because the cost of entry will keep going up. 

If you think rents going up, vacancy going down, supply going down, equals price of an investment property going down, lol, well I am sorry your just dead flat wrong in an epic manner. 

EVERY DAY is a GREAT day to buy! The only things that change is what, where and how! 

High interest rates, LOVING it! I love love LOVE less competition in my buys, your gonna tease me with being alone in the candy store, come on bro! because I know how to do C4D purchases! "Sure Mr/Mrs seller I'd LOVE to acquire your property at 5.25% lock, thank you!". 

If your stopped dead in your tracks by 1 single little thing in Real Estate, your NOT an investor, your a hobbyist! 

I love buying on C4D almost as much as I love selling on C4D!    Please, feel free to sit the sidelines and leave all the opportunity to me.