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. 

[Carlos Ptriawan]

Quote from @John Williams:

Something that many people are overlooking is the very real possibility that we may just have a normal cycle (i.e. not a crash like many expect because of what happened in 2008). What if is just a very moderate slowdown that rebounds back into very moderate/steady growth?

In fact, that's what my crystal ball says will happen!

 That's my bet as well for the Southern and Midwest markets. This would be very regional-specific. There's huge money flowing to South for construction.

We've been discussing the problem of price reduction only in the west region and even now there's an early indication that the rebound has already happened.

[James Hamling]

Quote from @Nicholas L.:

@Greg R.

 if builders pull back, won't that hurt supply such that prices will be propped up? 

 Yuup! The notion that builders will have to keep building and just give properties away is infantile thinking. 

We are in a significant net-shortage environment. That means, all indicators are STAGFLATION. The economy does NOT work on a Boom - Bust option of direction, there is this thing called STAGFLATION, which is what we are in NOW, live time, and getting deeper and deeper into day by day. High prices and low volume. 

So i no longer have to predict Stagflation, it's here, it's come to be, this is our new norm. STAGFLATION. 

[Eron A.]

many..many...mannnny people lie to themselves. also you got people that have this mindset of....keep a positive mind but ahhh....either way...a denier is a denier.

[James Hamling]

Check out the recent data as a few days ago @Carlos Ptriawan, wages went UP more then anticipated! Huh, wonder what that could be....... Do we dare say "Wage Inflation"....... 

So for those foolish few who said everyone would start selling there homes of 70 cents on the dollar because all would collapse, ignoring the fundamentals of inflation, poo-on-you, lol. As I had been saying, next wave of inflation to come is Wage Inflation. And that will spur next cycle of COG inflation, and the waves keep coming more muted then one before until 18-36 months into the future we find stability, all dependent upon any induced/ manipulated idiocy to come. 

[James Hamling]

Quote from @Michael Wooldridge:

Quote from @Victor S.:

Quote from @Michael Wooldridge:

Quote from @Victor S.:

Quote from @Michael Wooldridge:

Quote from @Victor S.:

Quote from @Michael Wooldridge:

Quote from @Victor S.:

Quote from @Michael Wooldridge:

Quote from @Victor S.:

Quote from @Michael Wooldridge:

So yes people are frustrated and yes they will continue to flop. I happen to believe the dems will hold more power in future years because of the frustration. And frankly given the shifts on the popular vote in recent years that trend should be obvious.

you have to be kidding. in what solar galaxy is that scenario a potential reality? i'm all ears.

 you are looking at just 2-4 year spans. I'm looking at something closer to 8-15 years. The timing has been good for GOP with economy for midterms. I don't believe it will be as red as it should be or that it will last. People are flipping because they are frustrated on economy. They will flip again. Not trying to turn this into a full political discussion but the PA senate race or Georgia Senate race are good examples. 

But sure my reality is wrong :). never mind I don't care who wins because it's all more of the same. 

at the rate those people are going, they might not even have a party in 8-15 years from now. you must not be aware of the "policies" and agendas that are getting peddled to make statements like the one above. good luck out there, Mike.

 Funny I hear the same from the left about the right. I'm guessing you are were surprised by 2020 results then?  Well aware of them all. I just don't care about it from either side.. All more of the same. 

 surprised? what are you talking about? your boy barely pulled ahead in key precincts. some sketchy stuff went down in 2020, that's a fact. thank god we are not ruled by the popular vote electees. 

 My boy? I don't care about him. But you just proved my point. Visit the coasts you'll find entirely different people from Ok / Texas (placed I am a lot and know well). Theres a reason why popular vote keeps trending up. And will continue too for years. one of us does have our head in the sand. I agree. Time will tell who but I don't think it will be me surprised. 

 you don't? you should, because he represents everything that is wrong in DC. i visited (and even lived on) the coasts, rest assured. you just made a whole bunch of assumptions because of my listed location, btw. i wasn't even born here, so i'm pretty sure i'm a bit more well-versed than you when it comes to having a well-rounded world view. 

 Location was an assumption sure but nothing to do with that logic jump. It was the comment about dems disappearing. They will only grow over the next 10-15 years. To me it's not about right or wrong but the data behind it. So the logic leap was because of that comment. If you actually believe dems will be pushed out, I have to make assumptions. 

nothing to do with your "Visit the coasts you'll find entirely different people from Ok / Texas"? Just what exactly did you mean by that one then?

"They will only grow over the next 10-15 years."

again, you're making these wild statements without any sort of rational explanation other than "the coast people know better" thing. 

"To me it's not about right or wrong but the data behind it."

where is it, the data? if anything, people with some level of intelligence are trying to leave those hell holes in a jiffy. post-covid migration is very telling, in light of how those "coasts know better" places (mis)handled the pandemic response.

"If you actually believe dems will be pushed out, I have to make assumptions. "

i didn't say they "will" disappear, i simply said they have a good chance of doing so if they keep going down the rabbit hole with their current ideology.

 At the rate they are going they won’t have a party is pretty well “disappear”. As to the ideology part both parties are ridiculous at this point on that front but I could argue one pivots faster there was one “policy” that was very popular around 2016-2019 but hasn’t been spoken of much lately. 

Data? Look at the popular vote trends this century. If it continues the electoral college won’t matter. Even funnier especially with people moving (and 99% of people move for jobs or COLA) you can see that popular vote spread.

Anyway this disagreement will be solved like the discussion around home prices with time. The latter half of 2020’s and early 2030s should be enlightening. 

 Both parties are at an inflection point. Both have a kind of internal civil-war going on, where the party itself has 2 polarized camp's within itself tearing and pulling for overall party control. So in a more accurate statement we have 4 parties who work under 2 banners. How this will play out is very uncertain. 

I am the forecaster of forecasters and not even I would dare a venture at projecting the future of either party. If I was forced, I would have to say I am much more pessimistic on survival of D's simply from the basis that they have history going against them, meaning the historical actions of that party and being in this tech-age, it's only a matter of time before such very ugly history comes into the forefront. It's hard for a party to sell itself as pro-minority when it founded the Klan, I mean come on right. Going all the way back to war of independence, D has stood against all things modern USA stands for, I am personally shocked this info has not already come to the forefront. 

The R has such history to fall back on as Abraham Lincoln and abolishment of slavery, that's a pretty big feather int he cap wouldn't one say. 

Although as i said, who knows, fact's and truths don't seem to play much of a central position anymore. 

What would be AMAZING is not just a strong viable 3rd party, but a 4th, 5th. The problem is the choice today, it's sh#t-sandwich or turd-burger, and that IS the popular vote position. If some viable alternatives arose, the most likely outcome is the death or near death decay of BOTH D & R party, right. 

Most people today don't vote for parties, they vote for results, hopes, solutions, what a person promises. There voting for the results they think that person/group will bring. It's not as it was decades back, people are very comfortable party jumping today, that is generations of gen-x and later, no loyalty to a party just on banner, no, people expect them to deliver. 

And let's be honest, most are not feeling D's are delivering today are they? Nothing is better, arguably everything is worse. It makes minds open to changing up decision process. 

Hey, how awesome would it be if there was NO parties, just people. That's it, just people who get elected on them, there word. And bills were done on it's merit not on the symbol carried by the one delivering it. 

Nothing good comes from a nation divided. 

[Carlos Ptriawan]

Quote from @James Hamling:

Check out the recent data as a few days ago @Carlos Ptriawan, wages went UP more then anticipated! Huh, wonder what that could be....... Do we dare say "Wage Inflation"....... 

Yea, market vs Fed. So far Mr. Market wins the battle.  Albeit temporarily.

Grandpa powell doesn't like that job number LOL 

Man what happened today is just so funny between the bull and the bear.

[Carlos Ptriawan]

Quote from @James Hamling:

Quote from @Michael Wooldridge:

Quote from @Victor S.:

Quote from @Michael Wooldridge:

Quote from @Victor S.:

Quote from @Michael Wooldridge:

Quote from @Victor S.:

Quote from @Michael Wooldridge:

Quote from @Victor S.:

Quote from @Michael Wooldridge:

Quote from @Victor S.:

What would be AMAZING is not just a strong viable 3rd party, but a 4th, 5th. The problem is the choice today, it's sh#t-sandwich or turd-burger, and that IS the popular vote position. If some viable alternatives arose, the most likely outcome is the death or near death decay of BOTH D & R party, right. 

I have the same analysis. How come there're only two parties in the biggest nation in the world?  
This binary world is very boring you know.

[Carlos Ptriawan]

Quote from @James Hamling:

Quote from @Nicholas L.:

@Greg R.

So i no longer have to predict Stagflation, it's here, it's come to be, this is our new norm. STAGFLATION. 

to make it more precise:

Sector-based stagflation.
Regional-based sector-specific recession.

[Luka Milicevic]

This thread is still going strong!!!!!!!!!!!!

I will say things have drastically changed since it was posted 2 months ago. 

[Michael Wooldridge]

Quote from @Carlos Ptriawan:

Quote from @James Hamling:

Quote from @Nicholas L.:

@Greg R.

So i no longer have to predict Stagflation, it's here, it's come to be, this is our new norm. STAGFLATION. 

to make it more precise:

Sector-based stagflation.
Regional-based sector-specific recession.

 is it even sector? people are talking about big tech dying. And there is some truth to that but then tech is doing well in some places also. Or Twitter is laying off yes (as well as a few other small silicon companies) but MS is pretty much in retain mode (maybt not hire) but full speed ahead with current staff and retaining them as much as possible.

I said this today in a few customer calls and internal calls - it's just going to be a weird 12 months. But I think that weird is mostly going to be stagnation/flatness. Which is fine. Better than big pain. 

[James Hamling]

Quote from @Carlos Ptriawan:

Quote from @James Hamling:

Quote from @Nicholas L.:

@Greg R.

So i no longer have to predict Stagflation, it's here, it's come to be, this is our new norm. STAGFLATION. 

to make it more precise:

Sector-based stagflation.
Regional-based sector-specific recession.

 Just wait, Stagflation is just starting to dig it's claws in, it's gonna spread like a cancer. Inducing recession is not working, and it won't work, because of the front-loading of the market via various shortages. And the sheer scale of inflation via M2, would take a far more extreme measure of recession to counteract.     There trying to "ease" way through the biggest most sudden inflation in U.S. history. It's like saying one's going to use band-aids for a severed limb. It's simply not gonna work. 

Even the Fed is now acknowledging a set-in stagflation as there describing it on forecast just avoiding using the word. 

[James Hamling]

Quote from @Michael Wooldridge:

Quote from @Carlos Ptriawan:

Quote from @James Hamling:

Quote from @Nicholas L.:

@Greg R.

So i no longer have to predict Stagflation, it's here, it's come to be, this is our new norm. STAGFLATION. 

to make it more precise:

Sector-based stagflation.
Regional-based sector-specific recession.

 is it even sector? people are talking about big tech dying. And there is some truth to that but then tech is doing well in some places also. Or Twitter is laying off yes (as well as a few other small silicon companies) but MS is pretty much in retain mode (maybt not hire) but full speed ahead with current staff and retaining them as much as possible.

I said this today in a few customer calls and internal calls - it's just going to be a weird 12 months. But I think that weird is mostly going to be stagnation/flatness. Which is fine. Better than big pain. 

 "Big pain" is amazing fertilizer for "big rebound". Stagflation, which is what your saying via other words, is the death wail of a economic decade or two. It's very hard to dig out from it. Think US has big debt vs GDP, check out Japan's, it's more then double US. That's because they had to dig out of a multi-decade stagflation. 

How would US dig out of stagflation in 2yrs? Mass infrastructure bills? How, where is the $$$$? Would mean even more trillions in spending. This is why the Fed is stepping on US neck more and more trying to choke things out, because they would rather get a roller-coaster effect from recession, boom cycle vs stagflation. 

Wage inflation is giving a false sense of security, or better said a hit of hopeium. At some point here people are going to start waking up to reality that prices are not going to come crashing down on anything, and that's when things get really interesting, when it starts hitting consumer spending in a deep meaningful level. To point it can't be hidden any further. 

My bet is that vs actual fundamental repairs, there will be knee jerk can-kicking of raising wages more, and to do such, yup, yet more F.Gov. spending to inject more $ into system. Inflation to combat inflation, what could possibly go wrong...... 

[James Hamling]

Quote from @Luka Milicevic:

This thread is still going strong!!!!!!!!!!!!

I will say things have drastically changed since it was posted 2 months ago. 

 Like?

[Carlos Ptriawan]

Quote from @Luka Milicevic:

This thread is still going strong!!!!!!!!!!!!

I will say things have drastically changed since it was posted 2 months ago. 

 ya , Mister market is beating our prediction.

[Carlos Ptriawan]

Quote from @Michael Wooldridge:

Quote from @Carlos Ptriawan:

Quote from @James Hamling:

Quote from @Nicholas L.:

@Greg R.

So i no longer have to predict Stagflation, it's here, it's come to be, this is our new norm. STAGFLATION. 

to make it more precise:

Sector-based stagflation.
Regional-based sector-specific recession.

 is it even sector? people are talking about big tech dying. And there is some truth to that but then tech is doing well in some places also. Or Twitter is laying off yes (as well as a few other small silicon companies) but MS is pretty much in retain mode (maybt not hire) but full speed ahead with current staff and retaining them as much as possible.

I said this today in a few customer calls and internal calls - it's just going to be a weird 12 months. But I think that weird is mostly going to be stagnation/flatness. Which is fine. Better than big pain. 

 Dude, what the heck. Tech is going strong.

Okay lets divide industries.

*The following industry are under recession :

Construction
Finance
Mortgage Lending
Housing
Realtor/Real Estate

*The following industry are under booming period

Oil Industry
Coal Industry
Gas
Solar
Commodity
Healthcare
Service/Hospitality industry
Anything related to service for Oil and Gas
Alcohol / Whisky related company lol
Weapon company, military equipment

*The following industry are under pressure
new field sector within Tech industry that doesnot generate money (Meta/VR/etc)


*The following industry are stable
Tech in hardware equipment
Telecommunication company
Software company that does generate cash-flow.


What the heck with tech is dying ? My 19 year old son is just accepted as Software Engineer at Zillow.
Tech is dying ? maybe you had too much booze lately LOL LOL

It's impossible tech is dying because our sector is having record backorder revenue worldwide. 

Your tech co. maybe dying now if your company doesn't generate cashflow. But if your company is self sustainable you would be okay.

[Carlos Ptriawan]

Quote from @James Hamling:

Quote from @Michael Wooldridge:

Quote from @Carlos Ptriawan:

Quote from @James Hamling:

Quote from @Nicholas L.:

@Greg R.

So i no longer have to predict Stagflation, it's here, it's come to be, this is our new norm. STAGFLATION. 

to make it more precise:

Sector-based stagflation.
Regional-based sector-specific recession.

 is it even sector? people are talking about big tech dying. And there is some truth to that but then tech is doing well in some places also. Or Twitter is laying off yes (as well as a few other small silicon companies) but MS is pretty much in retain mode (maybt not hire) but full speed ahead with current staff and retaining them as much as possible.

I said this today in a few customer calls and internal calls - it's just going to be a weird 12 months. But I think that weird is mostly going to be stagnation/flatness. Which is fine. Better than big pain. 

 "Big pain" is amazing fertilizer for "big rebound". Stagflation, which is what your saying via other words, is the death wail of a economic decade or two. It's very hard to dig out from it. Think US has big debt vs GDP, check out Japan's, it's more then double US. That's because they had to dig out of a multi-decade stagflation. 

All your reply needs very thorough understanding (before replying) James, I have to read the staglation definition again, it says for staglation to happen we need to have high unemployment. I think We don't have high unemployment right now, we have record low unemployment. For me it's a case where US economy is started to boom in 2021 but Fed is trying to kill it because the grandpa wanna follow his grandpa teaching back in 1930 and 1970 Volcker era (which I think personally very weird why he needs to follow such past circumstances when things are very different now). 

Mr. Powell so afraid of uncontrollable inflation that he himself created lol. But this economic boom of 2021 is actually his own decision, so it's very strange, I don't know how or what to call it. The thing is other Fed member has so much disagreement with grandpa Powell, that made everything so confusing. He seems more afraid of under-tighten rather than over-tighten. He seems like a believer of mythical cult. 

Now other country is doing combo of QT/QE while Japan is still doing full blown QE, make everything about economic theory is all BS.

[Michael Wooldridge]

Quote from @Carlos Ptriawan:

Quote from @Michael Wooldridge:

Quote from @Carlos Ptriawan:

Quote from @James Hamling:

Quote from @Nicholas L.:

@Greg R.

So i no longer have to predict Stagflation, it's here, it's come to be, this is our new norm. STAGFLATION. 

to make it more precise:

Sector-based stagflation.
Regional-based sector-specific recession.

 is it even sector? people are talking about big tech dying. And there is some truth to that but then tech is doing well in some places also. Or Twitter is laying off yes (as well as a few other small silicon companies) but MS is pretty much in retain mode (maybt not hire) but full speed ahead with current staff and retaining them as much as possible.

I said this today in a few customer calls and internal calls - it's just going to be a weird 12 months. But I think that weird is mostly going to be stagnation/flatness. Which is fine. Better than big pain. 

 Dude, what the heck. Tech is going strong.

Okay lets divide industries.

*The following industry are under recession :

Construction
Finance
Mortgage Lending
Housing
Realtor/Real Estate

*The following industry are under booming period

Oil Industry
Coal Industry
Gas
Solar
Commodity
Healthcare
Service/Hospitality industry
Anything related to service for Oil and Gas
Alcohol / Whisky related company lol
Weapon company, military equipment

*The following industry are under pressure
new field sector within Tech industry that doesnot generate money (Meta/VR/etc)


*The following industry are stable
Tech in hardware equipment
Telecommunication company
Software company that does generate cash-flow.


What the heck with tech is dying ? My 19 year old son is just accepted as Software Engineer at Zillow.
Tech is dying ? maybe you had too much booze lately LOL LOL

It's impossible tech is dying because our sector is having record backorder revenue worldwide. 

Your tech co. maybe dying now if your company doesn't generate cashflow. But if your company is self sustainable you would be okay.

Was multitasking but mostly meant tech was hurting not dying poor choice while doing things. And I’m specifically talking against the swings in markets and to some extent revenues. 

IN the rest of the post I happened to point out there was plenty of tech doing well.
 

Telecommunications is doing well eh? Tell that to VZ (3 billion restructure to cut costs just announced) and ATT who have both done lay offs and fallen dramatically in market cap and behind Tmobile. Oh BTW TMobile also did some lay offs. Long term telecom is going to be very healthy with the business big up in Edge/IoT etc… BUT I don’t know if I’d sa that industry is doing great. 

Anyway I had only meant to point out that Meta, Twitter etc are giving appearenced for tech not doing well that thye are reading into. Outside of the cash flow hurting tech companies (of which there are many) they are all doing well. Still the reshuffling on valuation has hit pretty much all of them including Google and Amazon. Big new story lately is how Apple is worth more than Google, Amazon, and Meta combined.

There are reasons behind that but it’s nuts to think about.

[Carlos Ptriawan]

Dude you really need to come up with numbers, okay, when you read something, examine exactly how many is layoff compared to the present employment number. Also, check which group is impacted. All these articles like to over-dramatic on something silly just to make news. 

You also need to check their EPS, is it even declining? For VZ the EPS has been stable for the last 5-6 years. So they can only increase margin by reducing opex thru employment, it's their low-impact "retail store marketing" that got some impact, nothing in the engineering department.  
For AT&T, their EPS just hit a new record this year.

Overall telco industry is extremely healthy. Just look at Telco ETF, it's still within 15% of 52 week high.

[Nicholas L.]

All I'm seeing so far at lower price points is... prices haven't gone down, while monthly payments have gone way, way up because of the increase in interest rates.  With inventory so low, it seems like this just creates pressure on people who need to buy homes to stretch.  As far as I know you don't get struck by lightning if you spend 40 or 50 or 70% of your income on housing... it's just a big strain on your budget.

Most of the examples of big price drops in this thread have been high six figure properties in overheated markets - I'd love to get an 800K property in Austin or Boise for 540 or whatever, but that's not the market I buy in or the price point I buy at =)

Thoughts from the group?  We've gone far afield - oil prices!  The future of political parties!  The Great Reset!  What about... house prices?  Anyone?  Bueller?  Bueller?

[Victor S.]

Quote from @James Hamling:

I am the forecaster of forecasters and not even I would dare a venture at projecting the future of either party. If I was forced, I would have to say I am much more pessimistic on survival of D's simply from the basis that they have history going against them, meaning the historical actions of that party and being in this tech-age, it's only a matter of time before such very ugly history comes into the forefront. It's hard for a party to sell itself as pro-minority when it founded the Klan, I mean come on right. Going all the way back to war of independence, D has stood against all things modern USA stands for, I am personally shocked this info has not already come to the forefront. 

The R has such history to fall back on as Abraham Lincoln and abolishment of slavery, that's a pretty big feather int he cap wouldn't one say. 

Although as i said, who knows, fact's and truths don't seem to play much of a central position anymore. 

What would be AMAZING is not just a strong viable 3rd party, but a 4th, 5th. The problem is the choice today, it's sh#t-sandwich or turd-burger, and that IS the popular vote position. If some viable alternatives arose, the most likely outcome is the death or near death decay of BOTH D & R party, right. 

Most people today don't vote for parties, they vote for results, hopes, solutions, what a person promises. There voting for the results they think that person/group will bring. It's not as it was decades back, people are very comfortable party jumping today, that is generations of gen-x and later, no loyalty to a party just on banner, no, people expect them to deliver. 

And let's be honest, most are not feeling D's are delivering today are they? Nothing is better, arguably everything is worse. It makes minds open to changing up decision process. 

Hey, how awesome would it be if there was NO parties, just people. That's it, just people who get elected on them, there word. And bills were done on it's merit not on the symbol carried by the one delivering it. 

Nothing good comes from a nation divided. 

 agree that both parties are in a crisis mode, tho i'd argue that the left is far more polarized than the right, as far as their mainstream ideology is concerned. more people within the dem party are becoming more and more off-center than their repub counterparts. the msm (and grandpa with his speeches lately) would want you to believe otherwise. too bad repubs don't really have a platform other than "look at these loons on the left." they had the congress, senate, and presidency in 2016. blew it bigly.  i am glad to see the old rhinos getting slowly flushed down the toilet lately, so there is hope. 

the dems do have an answer to your historical questioning (re:klan, etc) - "tHe PaRtIeS hAvE sHiFtEd IdEoLoGiEs!11!!" yeah, sure thing... 

James, you sounded just like John Lenon there at the end with the "imagine"-like lines lol We need to understand and realize just who was sawing this division. All you have to do is go back in time and observe every single msm outlet starting around late 2015. 

[James Hamling]

Quote from @Victor S.:

Quote from @James Hamling:

I am the forecaster of forecasters and not even I would dare a venture at projecting the future of either party. If I was forced, I would have to say I am much more pessimistic on survival of D's simply from the basis that they have history going against them, meaning the historical actions of that party and being in this tech-age, it's only a matter of time before such very ugly history comes into the forefront. It's hard for a party to sell itself as pro-minority when it founded the Klan, I mean come on right. Going all the way back to war of independence, D has stood against all things modern USA stands for, I am personally shocked this info has not already come to the forefront. 

The R has such history to fall back on as Abraham Lincoln and abolishment of slavery, that's a pretty big feather int he cap wouldn't one say. 

Although as i said, who knows, fact's and truths don't seem to play much of a central position anymore. 

What would be AMAZING is not just a strong viable 3rd party, but a 4th, 5th. The problem is the choice today, it's sh#t-sandwich or turd-burger, and that IS the popular vote position. If some viable alternatives arose, the most likely outcome is the death or near death decay of BOTH D & R party, right. 

Most people today don't vote for parties, they vote for results, hopes, solutions, what a person promises. There voting for the results they think that person/group will bring. It's not as it was decades back, people are very comfortable party jumping today, that is generations of gen-x and later, no loyalty to a party just on banner, no, people expect them to deliver. 

And let's be honest, most are not feeling D's are delivering today are they? Nothing is better, arguably everything is worse. It makes minds open to changing up decision process. 

Hey, how awesome would it be if there was NO parties, just people. That's it, just people who get elected on them, there word. And bills were done on it's merit not on the symbol carried by the one delivering it. 

Nothing good comes from a nation divided. 

 agree that both parties are in a crisis mode, tho i'd argue that the left is far more polarized than the right, as far as their mainstream ideology is concerned. more people within the dem party are becoming more and more off-center than their repub counterparts. the msm (and grandpa with his speeches lately) would want you to believe otherwise. too bad repubs don't really have a platform other than "look at these loons on the left." they had the congress, senate, and presidency in 2016. blew it bigly.  i am glad to see the old rhinos getting slowly flushed down the toilet lately, so there is hope. 

the dems do have an answer to your historical questioning (re:klan, etc) - "tHe PaRtIeS hAvE sHiFtEd IdEoLoGiEs!11!!" yeah, sure thing... 

James, you sounded just like John Lenon there at the end with the "imagine"-like lines lol We need to understand and realize just who was sawing this division. All you have to do is go back in time and observe every single msm outlet starting around late 2015. 

 Much to agree on here. 

Although, playing devils advocate; See that is the rub, that the progressive movement inside the D party today views those with right leanings or placement with the exact same perspective of "wow, there nuts". And it's the collision of fundamentally opposed ideologies. Each will see the other as "nutz" because they are in context of that other groups central vision and beliefs. 

And that's the one most important conversation being missed in very literally every debate and argument I have ever seen, the two sides acknowledging that they have very opposite central ideologies, and just engaging in that perspective as reasonable adults vs ax wielding combatants. 

I have friends, close friends, who grew up and lived behind the "Iron Curtain", my information and opinions on communist socialism come from 1st hand "expert" level of intimate experience of such, and not a 1 has ever had anything good of it. It was a system that was intensely polarized between the "elitist" class party members who were have's, and the 90% who were surf's, serving the Elite class. That's the reality of it. BUT, man-oh-man do they have amazing propaganda and great sales pitch. That's what it's always had in spades, because really the concept is a beautiful picture of things right, something that really engages the masses. That is all about the worker class, getting at those evil rich people, and all you have to do is give yourself heart and soul to the "state" and don't worry about anything in the world because the "state" will provide everything for you.     Now, when you really boil it down it's a sales pitch that everyone can be uber-lazy, don't think, don't strive, don't try, just chillax and "the state" will do all the complicated thinking and all that, you just gotta exist and everything will be great. 

VS the other side which argues on freedom that, you can do everything yourself and reap the reward, or penalty. Everything is on you the person. you the person will have to work hard to get everything. Invest, apply yourself, think for yourself, do yourself etc etc etc.. it's a kind of crappy sales pitch right. 

One says "netflix and chill" the other is "bust your azz 25hrs a day".     Are we surprised those who have not experienced the reality of it are buying that commi BS? I'm not. 

Most people don't want freedom, they don't. They want stuff. They want easy. They want chill. They want the things, not the work. And truth be told, it's our fault, we the people. We have been farming weak panzy-azz people the last few generations. We have by design made a soft society, so of course it gravitates to what best sounds easiest. 

We built a cat farm, and now we are in shock they won't play fetch. 

[Nick Robinson]

@Carlos Ptriawan
I skimmed some of the posts so someone may have mentioned this, but the market has been projecting a recession, at min. a decrease in economic activity for over a year. It was obvious 2yrs ago that big retailers were buying mass amounts of goods and that it was false demand for these products combined w/ supply chain issues. We were going to see a surplus of goods and thus disinflation if not deflation on goods. The Euro$ futures curve inverted last year at the beginning of Dec and the 10yr/2yr UST inverted in March of this year. With the UST inversion it has over a 90% success rate in calling a recession in the next 6-24 months with the avg being 16months. The one time it was "wrong" it inverted went positive reinverted and then you had a recession.

The #s that are being released are terrible. The Jobs data you are looking at takes raw data and puts it into logarithms to smooth out the trendline, so it is easier to read. Look at the Household survey #s FT jobs have declined in 5 out of the last 7months and this month we had a loss of 490k FT jobs. This data is a lot closer to reality seeing companies stop hiring and moving FT workers to PT. How about unemployment? The U-3 number is 3.7%, but a more accurate U-6 is 6.3%. Look at auto loans, Airbnb bookings. Based on the UST yield curve it was projecting Nov may be the last rate hike months ago and now seeing the 3mo/10yr invert for most of the week not looking good. We probably will still see a melt-up in stocks before the big crash. Once things start to break it spreads through the financial system like a virus and w/ all the leverage in the system no one knows how long or deep the upcoming recession will be and what it will affect.

[James Hamling]

Quote from @Nicholas L.:

All I'm seeing so far at lower price points is... prices haven't gone down, while monthly payments have gone way, way up because of the increase in interest rates.  With inventory so low, it seems like this just creates pressure on people who need to buy homes to stretch.  As far as I know you don't get struck by lightning if you spend 40 or 50 or 70% of your income on housing... it's just a big strain on your budget.

Most of the examples of big price drops in this thread have been high six figure properties in overheated markets - I'd love to get an 800K property in Austin or Boise for 540 or whatever, but that's not the market I buy in or the price point I buy at =)

Thoughts from the group?  We've gone far afield - oil prices!  The future of political parties!  The Great Reset!  What about... house prices?  Anyone?  Bueller?  Bueller?

 I have posted on home prices about 40+ times in this thread. So far, everything is right on track as I forecasted it. Which to be honest, I wish I were wrong. I would have loved to be dancing in the streets snagging places for pennies on the dollar again. But it's simply not gonna happen. 

In shortest, simplest explanation, look for pricing COMPRESSION. 

And yes, exactly as you said the examples are high $ properties in the grossly inflated market areas, which is exactly what pricing compression does, it brings those down, while pulling UP the lowest rung "affordable" properties. 

For example, what can a person buy in DFW for $150k today?    Go back just 3 years, the answer would have been a lot, today it's a laugh. 

The top rung properties will now start having greater pricing compression although many buyers in that class are also very liquid cash buyers so it's not a universal response, strategic foreclosures are potentials in that level.    Rather universally, the lower rung of "affordable" housing will have a significantly higher basis pricing vs 2/3yrs ago. And we will see this consolidation there.    

Builders will pivot there build designs and styles to match market factors. Think townhomes, it's going to be all about townhomes. Housing will be a lot like the auto industry of 80's, things will get smaller, simpler, to make them more affordable. 

Also, emergence of more options and innovators will come to forefront. Developers marketing rent-2-own and CD options. Various entities doing the same. Build-4-rent and the associated investment funds. Which by the way, it's already happening today it's just not public notice of such. 

The population will continue shift into renting at greater clip. Small time investors will continue to struggle more and more for entry and organized investment groups continue to gobble up more and more of market share. 

Remember how once upon a time the majority of retail shops were an assortment of main street ma & Pa business's? And today, it's a handful of corporate giants with 90%+ market share. yeah, that's where investment real estate is going. It is a consolidation event that's begun, so sitting the sidelines "waiting" for an easy on-ramp has good odd's of meaning never getting in, as bar is going to keep raising for entry. 

I had warned, that as tough it may seem to get in today seems, it's a lot easier then what it will be tomorrow, and the day after. Just wait and see what it's like after 3 more Fed rate hikes. 

[Nicholas L.]

@James Hamling I agree with most of your last 2 posts, and continue to appreciate your perspective.  "Compression" is a good way of putting the shifts. we are experiencing.

I do think institutional investors will continue to push into all aspects of real estate, although they've really struggled on the single family home front, haven't they? They went from owning basically none pre 2008 to owning a small but significant percentage, and found out it was idiosyncratic and more difficult than they thought. But to your point, I expect that, as long as there continue to be reasonable yields in SFH rentals, they'll continue to try.

And there will be more fractional ownership nonsense too.

[James Hamling]

Quote from @Nicholas L.:

@James Hamling I agree with most of your last 2 posts, and continue to appreciate your perspective.  "Compression" is a good way of putting the shifts. we are experiencing.

I do think institutional investors will continue to push into all aspects of real estate, although they've really struggled on the single family home front, haven't they? They went from owning basically none pre 2008 to owning a small but significant percentage, and found out it was idiosyncratic and more difficult than they thought. But to your point, I expect that, as long as there continue to be reasonable yields in SFH rentals, they'll continue to try.

And there will be more fractional ownership nonsense too.

 So I am in a little bit of a pickle here Nicholas. I am going to try and answer this as completely and detailed as I can, but, there is NDA's in place that severely restrict the level of disclosure I can make in this discussion. This should tell you something right here, ok. 

I do not speak from theory or articles when it comes to institutional buyers, in majority part, I speak from 1st hand live-time experience. To best of my knowledge, my brokerage is now the #1 representative for such investors in U.S.. Some of the things you may read in news and articles, are activities we are doing, it's our work your reading about. 

I can confirm the institution investor entry into SFR (Single Family Rentals) is NOT declining, it's growing, significantly. By significantly I am speaking at a compounded rate, parabolic in it's growth trajectory. It's just a matter of public awareness, we do not advertise this, none do, why would we, there is 0 benefit to broadcast it to the world. Inside the world of institutional $, yes it's broadcasted, but these are very private sectors and closed networks.

I would compare it with the Yukon Gold Rush, it's on that level. And this "Gold Rush" didn't start kicking off until 2020. The state of world markets has been like jet-fuel for it. There was some stutter steps last little bit, while various groups took read of the economic landscape with so much going on but in recent weeks/ months it's been a clear signal of "go-go-go". 

In the coming months your going to see entity after entity pop-up talking about acquiring via various means all the SFR they can get there hands on. It's a tsunami of capital. You have to keep in mind who the underlying investors are in these funds, review how the top 2% have done the last couple years, it's record profits across the board. Where do you think those profits go? They have a big $ problem, they have ton's of $, more then ever, and need to put it somewhere, and they want it to be safe against, among other things, inflation. R.E. is still the #1 hedge against such.

Yields, the COC is just 1 metric these buyers consider and honestly, COC is weighted least among the metrics. We have depreciation, that's a very big factor, equitable gains from appreciation, hedging against inflation, etc etc etc..

Look, picture this. If you had $675million in liquid capital, what would your primary concerns be? Is it getting a 10%+ COC yield? Remember, it's $675 MILLION, not thousand. No, big epic profits are not a central focus because you already have more $ then you can spend. The #1 primary concern is NOT LOOSING much of it. When you have more then you can spend in 3 lifetimes it's not about making money, it's about PRESERVING your wealth. So for this, you look at assurances of safety. Real Estate is king, absolute KING in this to an extreme degree today vs all other assets for Capital Preservation. AND looking at a 4/5% yield on top of that, well holly-cow, it's X-mas!

We have inflation raging not just in US but it's all over. Global energy in crisis. World markets in a mess. Political upheaval. We have every chaos factor in full throttle going and in Real Estate, a massive housing shortage. Where do you put your wealth to preserve it? 

And these people do not do it directly in large part, they entrust a firm, with capital management team, who intakes from multiple HNW (High Net Worth) persons, to actively manage because a HNW person is too busy running what made them a HNW person, and they simply don't engage in what they don't know, because there really smart. Do what your great at, and hire the best to do the rest. And those funds are then utilized in diversified deployment. Going into multiple markets to hedge against market specific variations. 

The fund managers make $ on the management and spread. They know that clearing 4.15% cap on a billion dollars is avalanches of profit. It operates much like an insurance company fund does, as it relates to cap-x and operational outlay. 

While I can not and will not name names, I can confirm my 1st hand knowledge of no less then 10 figure in acquisitions on this front. Yes, we are talking Billions with a "B" in acquisitions not millions. That's how serious the movement is, it's Billions worth of serious. And I see it growing, not slowing. It's like a threshold was passed in the last 18 months where it became normalized in such a way that everyone started jumping in. Or it was turmoil, or inflation, who knows, but it's a big capital movement. 

Fractional ownership I pay little to no attention to. It's a gimmick to get people who can't afford to play the game a chance to play the game. It's like referencing Robinhood, they did the same ins tocks and at full height made up a singular rain-drop of total market volume, I see the same playing out in R.E. because at end of day getting tons of people with very little $ is still, just a pool of little $. Hard to compete with fund managers taking multi-million investment checks on the daily. 

And any who think your going to find who these entities are, good luck. They have best of the best in entity structure. You will never know anything they don't select to allow you to know/find. Remember, we live in a Plutocratic world.