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 @V.G Jason:

Quote from @James Hamling:

Quote from @V.G Jason:

Quote from @James Hamling:

Quote from @V.G Jason:

sionals exiting REI is a GOOD thing, it means STABILITY not instability. The non-professionals make-up a drip in the overall bucket that is REI Industry. For decades countless masses seek to get in, buy programs galore to find there in, and very VERY few ever actually get-in. The vast majority of REI activity is, has been, and will remain professionals.

So for the few who will be pressed out, and yes it is a very limited few who actually would have been in but can't vs those just using it as there new excuse for still not actually doing anything, oh well. It's a non-issue. 

For the many who want to get in and find a hurdle, and use there wit's, they will JV, join syndications, turn-key, or any of the various other entry options. There is a lot of very smart "noobs" out there, I have faith most will recognize when the climate has changed and level of complexity has moved above there capacity, and that it's fertile ground to ADJUST to JV-type actions.

There is no risk of sizable capital retraction from such. 

 In bold, you'd be surprised. Very surprised. Clearly, you're way ahead of the curve, but don't assume everyone else is. Infact, that's the reason there is a curve.

 This "recession/inflation" impact mostly speculator. Especially speculators in tech entrepreneurship, finance tech, and crypto. During 2001, there's a wipeout of speculation investment, which is very good in the long term lol. We need those lay offs.

Now I would guess there would be more conservativeness in investing, especially in the huge private equity world, they may avoid speculative tech,finance and totally avoid crypto. That excess money may be going to government bonds and real estate-backed assets as a safer asset class.

[V.G Jason]

Quote from @Carlos Ptriawan:

Quote from @V.G Jason:

Quote from @James Hamling:

Quote from @V.G Jason:

Quote from @James Hamling:

Quote from @V.G Jason:

sionals exiting REI is a GOOD thing, it means STABILITY not instability. The non-professionals make-up a drip in the overall bucket that is REI Industry. For decades countless masses seek to get in, buy programs galore to find there in, and very VERY few ever actually get-in. The vast majority of REI activity is, has been, and will remain professionals.

So for the few who will be pressed out, and yes it is a very limited few who actually would have been in but can't vs those just using it as there new excuse for still not actually doing anything, oh well. It's a non-issue. 

For the many who want to get in and find a hurdle, and use there wit's, they will JV, join syndications, turn-key, or any of the various other entry options. There is a lot of very smart "noobs" out there, I have faith most will recognize when the climate has changed and level of complexity has moved above there capacity, and that it's fertile ground to ADJUST to JV-type actions.

There is no risk of sizable capital retraction from such. 

 In bold, you'd be surprised. Very surprised. Clearly, you're way ahead of the curve, but don't assume everyone else is. Infact, that's the reason there is a curve.

 This "recession/inflation" impact mostly speculator. Especially speculators in tech entrepreneurship, finance tech, and crypto. During 2001, there's a wipeout of speculation investment, which is very good in the long term lol. We need those lay offs.

Now I would guess there would be more conservativeness in investing, especially in the huge private equity world, they may avoid speculative tech,finance and totally avoid crypto. That excess money may be going to government bonds and real estate-backed assets as a safer asset class.

 They are not totally avoiding crypto. Infact, some of the large institutions are sitting primed to make their mark. Fidelity just starting going in, but you got 3 other big dogs within arms length and a few others at the two yard line. The bank I've used has already asked me about a placement for mid 2023. 

Real estate assets yes will be utilized again. But 2001 is a different time, I don't think we should compare things to previous times. We'll compare anything we see in a 2035-2045 recession or downturn and use it to evaluate our 2022-2023 one and do the same ordeal. It's rarely the same exact thing in controlled markets, infact it's usually the cause of it that keeps the market short it on the next rally.

[Caroline Widjaja]

Quote from @Carlos Ptriawan:

Quote from @Nicholas L.:

One thing that gets overlooked is that not every property purchased by an institutional buyer is held by them. According to NAR only 42% of SFH purchases by institutional investors are kept as rentals.

I used to track their activity, they usually do a buy-fix-rental-sell model, most of their purchases were between 2014-2016, and sold the same houses in 2018-2019. Their activity is quite a good indication of when the market would make impactful changes. Now if JLL is entering the spaces I think they may have a future plan to have REIT specific to regional SFR only. This company in particular never loses investor money.

I used to work in one of the private equity firm where it's used to be only 3 big players back then (American Homes 4 Rent, Blackstone, & Colony Capital). The company that I worked for were invested heavily in SFR only (buy, small fix-up, and rent it out), bought a lot of JP Morgan portfolios and made a lot of money from that. It is not a surprise to me that now BlackRock, JP Morgan, and JLL enter this market. My big boss once told us "US will become a renter's nation", you will see if he's telling the truth or not.

[James Hamling]

And so the shoe drops....... 

"....US economy will suffer stagflation next year, a top strategist says".

Here is a few "highlights" from what the main-stream is now openly admitting:
"US economy will shrink and face stubborn price increases next year", "Our best guess is that we're going to be in a period of stagflation for several months through maybe most of next year". 

You will notice NOWHERE is there any mention of "crash" in any way shape or form, but they DO speak to price INCREASE, in many forms. Directly calling out such, indirectly via saying the inflation is NOT done "inflation threat has not faded", and now out-right calling/forecasting for STAGFLATION cycle. 

Several flooded this posting at start months ago saying the sky was falling, how without doubt National Median home prices would CRASH, at level or MORE then '08', predicting a MINIMUM 20% drop in National Median home values, and some going as far as saying minimum 30% drop. They talked about properties flooding the market, builder/developers going bust, institutional investors dumping properties in mass...... A "Dooms-Day" scenario.          I called them out as being INCORRECT, FALSE and/or just out-right liars, because they were, it was mathematical, YES this was fully predictable and proof is in fact I accurately predicted it many months ago. 

This matters, a LOT because I hope some people learn a lesson here to CHILL THE F-OUT, emotional response is almost always the WRONG response. Unless there is a T-Rex, then yes, freak out and run Forest RUN! 

Look, 2008 was a collapse of the FINANCIAL SYSTEM, not housing, not economy, not banking, not beanie babies or anything else, THE FINANCIAL SYSTEM. And that breaking, the expression of a systemic "cancer" that was a ticking time-bomb as Michael Burry accurately predicted far FAR in advance, again because it was mathematical, it had an impact unto all the other sectors such as housing and the economy as a whole. 

From that a long list of FALSE concepts have risen, such as the economy taking a collective "dump" every so many years. Need I remind '08' was the 2nd such "crash" in the ENTIRE history of the U.S., the second, EVER. That is far from any kind of "cycle". 

This, today, is INFLATION. The U.S. has gone through similar inflationary cycles. The entire civilized world has gone through inflationary cycle. There is nothing new of such, it is not unique. 

When you were 10 years old, how much was a Snickers bar? How much is one today? That's inflation. Did your home value go down in that time? What happened to the price of assets, be it a house, a car, a bar of gold? 

Inflation makes currency purchasing power go DOWN, meaning things or value require MORE to acquire. Did home prices go up 24% last year, or did the purchasing power of a dollar go DOWN 24%? 

You must use your head for more then a neck-weight, look around you, use critical thinking, you DON'T need some talking box to instruct you for every thought, your fully capable of taking in information and forming informed observations, this inflation and it's impact is literally all around everyone all one has to do is open there eyes and think for themself. 

When EVERYTHING goes up in price, you have to ask did every sector, every business have some secret meeting where they voted to collectively raise all prices together, or is your dollar worth LESS. And what happens when that dead-president-art does LESS? What happens to things that humans NEED, value, seek and is of fixed supply? 

Buffet tried to warn the population in mass that this was coming, the greatest transference of wealth in human history. Are you awake yet? 

Illegitimi non carborundum

[Kevin Maher]

In every recession in my market of NW Florida the 2nd home market crashes.  And as a wise old appraiser explained was drop tourism and a drop finical stability of owners results in getting rid of the most risky asset there 2nd home.  And they are mostly financed on Arm loans.  As they have to refi and lower rental incomes will make that difficult to cash flow.  They put it on the market.  Also these people typically are higher earning individuals with better awareness of the general economy and stock market.  Inventory has increased in this market to 6 months in the past 6 months when it was at less than a month.  Sales declined 60%.  So no buyers and the developer still has them going up.  Equals a foreclosure coming.  This is just like the stock market.  People know we are at the peak and are putting more inventory on the market.  This will result in laid off construction workers.  Supply chain in construction will self correct. This will take another 1 to 2 years.  Interest rates are going up and will stay up.  I lived thru the 70 and 80's.  It was nasty.  You are betting a lot on a govt that caused this and said it wasn't going to happen that they will get the correcting part right.  I sold my house bought a rv and taking the next 2 years off.  I made  1mil off a 450k house after 4 years.  Thats nuts and can't keep going. Common sense.  The 2nd home market will crash.  And if rates stay at 5% the price will have to drop 50% for the same buyer to be able to buy.  And that will happen over the next two years or higher.  Layoffs are starting.  UPS is laying off, Amazon.  These people see the writing on the wall.

[Carlos Ptriawan]

Quote from @Kevin Maher:

In every recession in my market of NW Florida the 2nd home market crashes.  And as a wise old appraiser explained was drop tourism and a drop finical stability of owners results in getting rid of the most risky asset there 2nd home.  And they are mostly financed on Arm loans.  As they have to refi and lower rental incomes will make that difficult to cash flow.  They put it on the market.  Also these people typically are higher earning individuals with better awareness of the general economy and stock market.  Inventory has increased in this market to 6 months in the past 6 months when it was at less than a month.  Sales declined 60%.  So no buyers and the developer still has them going up.  Equals a foreclosure coming.  This is just like the stock market.  People know we are at the peak and are putting more inventory on the market.  This will result in laid off construction workers.  Supply chain in construction will self correct. This will take another 1 to 2 years.  Interest rates are going up and will stay up.  I lived thru the 70 and 80's.  It was nasty.  You are betting a lot on a govt that caused this and said it wasn't going to

what's funny is :
- interest rate started going down
- FL and TX are very resilient this time 
- foreclosure is at a historic low
- stock market? the stock market is almost reaching a new time high, only negative 9 percent from ath
- inventory is not increasing in the last two months 
- cost of lumber is all-time low
- home depot is making good revenues. 

my reality saying this market is stuck, but bear market camp would say wait til next year. problem with most folks is they use past history to analyze while what we face now is something different, james camp says it as stagflation.

[Caroline Widjaja]

Sometimes people overreact over nothing. Some layoffs happened, but the company are still hiring seasonal workers. If you look at other career opportunities such as accounting in real estate firm/other industries, you will see tons of job opportunities out there right now. Bottom line, company feels overpaying the employees, so they did some layoffs, and then rehire them at a much lower pay during the "recession/crash/whatever you name it".  Company are just taking advantage of the situation. 

[James Hamling]

Quote from @Carlos Ptriawan:

Quote from @Kevin Maher:

In every recession in my market of NW Florida the 2nd home market crashes.  And as a wise old appraiser explained was drop tourism and a drop finical stability of owners results in getting rid of the most risky asset there 2nd home.  And they are mostly financed on Arm loans.  As they have to refi and lower rental incomes will make that difficult to cash flow.  They put it on the market.  Also these people typically are higher earning individuals with better awareness of the general economy and stock market.  Inventory has increased in this market to 6 months in the past 6 months when it was at less than a month.  Sales declined 60%.  So no buyers and the developer still has them going up.  Equals a foreclosure coming.  This is just like the stock market.  People know we are at the peak and are putting more inventory on the market.  This will result in laid off construction workers.  Supply chain in construction will self correct. This will take another 1 to 2 years.  Interest rates are going up and will stay up.  I lived thru the 70 and 80's.  It was nasty.  You are betting a lot on a govt that caused this and said it wasn't going to

what's funny is :
- interest rate started going down
- FL and TX are very resilient this time 
- foreclosure is at a historic low
- stock market? the stock market is almost reaching a new time high, only negative 9 percent from ath
- inventory is not increasing in the last two months 
- cost of lumber is all-time low
- home depot is making good revenues. 

my reality saying this market is stuck, but bear market camp would say wait til next year. problem with most folks is they use past history to analyze while what we face now is something different, james camp says it as stagflation.

 Know what, after J-Pow interview yesterday, I update my outlook to HIGHLY optimistic, and I am starting to think they CAN pull this off. 

J-Pow gave the BEST interview ever, of any Fed member, leader etc.. he answered every question one could ever have, including what's been not working and why, in his opinion, what willing to do, what NOT willing to do, and detailed the needle there looking to thread. 

In short, he is 100% aware of the Stagflation taking hold, and that there going to have to run along the "edge" of stagflation, because they have to. That he has to use the only available outlet of demand destruction because he has no capabilities to hit supply, so he is 100% focused on throttling demand. And it will mean some Stagflation but, if done right, and things come together, it will not be economy wide, will avoid a full stall, and can sling-shot out of it. 

But when it comes to Stagflation, it's no longer "my" camp speaking of such, unless you include the Fed and many of the top forecasters because all are now speaking of stagflation. 

J-pow has significantly raised my confidence, big time, I think he does know what he's doing, knows his lane of things, and even hinted at frustration of the inaction by those who could influence and impact supply side of things is politicians. 

Think, they could issue out a short term tax moratorium for supply-side related items and actions, something for manufacturers, which would immediately boost production rates up. Higher production means lowered supply costs, and alleviating strain. But no, there doing nothing. So J-Pow has to use the only thing he can, demand destruction. BUT even then he made it clear he is NOT willing to do it at expense of creating mass unemployment, not tanking things just stalling growth. 

He said it more times then I can recount, of giving supply chain a opportunity to catch up. 

Now, if it doesn't work out, if things go sideways, yeah, skirting the edge of the sun that is Stagflation, that gravity can quickly suck the economy full-in, stall out the economy fully, and pull us deep into a stagflation economy wide. That happens, who knows, future will depend on gov response because only way out is direct injections into economy, in some sizable form. 

Look at Japans debt too GDP, it's epic what it took for them to slodge out of stagflation. I am certain they will not want to let US fall into that same rut. 

[Nicholas L.]

@James Hamling

I had the same thought.  The market seemed to like the remarks.

[James Hamling]

Quote from @Nicholas L.:

@James Hamling

I had the same thought.  The market seemed to like the remarks.

 Every politician, major organization leader could take some notes from that interview, J-Pow was simply brilliant. 

It really was complete and total answers. Speaking to what mistakes were made, heck, when is last time any leader of such position did that, right. And, it instills so much more confidence knowing they recognize the mistakes, because there learning from them, improvement is impossible from arrogance. 

And owning the fact that he won't give any absolute forecasts going forward because it's simply not possible because the forces at play are so new, unique, that this is new territory, and there doing what they can, what they do recognize and understand. 

I am curious how many picked up what he was laying down about real estate, and namely RENTS being what is leading real estate market and will continue to do so all the more. How he referred to ALL real estate users as "tenants", and made distinction from tenant "owners" and tenant "users", as in a person who buys a home is actually just a tenant ALSO because the banks actually owns the home NOT them, there just a tenant with a payment plan TO OWN, eventually. That's big, it shows how that world is viewing it all. 

While J-Pow was hopeful for a reduction in rent payment rate of increase, he pointed out the wage inflation at hand and the relationship that as wages kept inflating so would rental payment rates, and thus supporting an overall enduring inflation. This is EXACTLY what I have been speaking to for almost a year now. 

So, thank you J-Pow, I accept your endorsement of my economic theory, lol. 

[Carlos Ptriawan]

Quote from @James Hamling:

Quote from @Carlos Ptriawan:

Think, they could issue out a short term tax moratorium for supply-side related items and actions, something for manufacturers, which would immediately boost production rates up. Higher production means lowered supply costs, and alleviating strain. But no, there doing nothing. So J-Pow has to use the only thing he can, demand destruction. BUT even then he made it clear he is NOT willing to do it at expense of creating mass unemployment, not tanking things just stalling growth. 

He said it more times then I can recount, of giving supply chain a opportunity to catc

There're few POVs to read Fed speak/action.

- Last month the JPow guy still saying we have to raise the interest rate as much as possible because the job market is still good. HOWEVER,
Fed action in the background they already created a U-shape bond and stock recovery where they start injecting liquidity to the market

- This month as JOLT number is pretty bad and PMI is signaling a recession,the JPow guy said "I would be tired if I have recover the economy from recession", a complete 180-degree situation LOL. What's funny is we still have almost 3 percent GDP growth, that's insane. However, the bond market has to make U-turn so much that the stock is now entering a risk-off area where investment group pouring million again to the market, the housing market get a better mortgage and we have record purchase of bond buying although it's not coming from Fed itself, for sure, for sure, it is indirectly coordinated by the Fed LOL .... The dollar is reaching new 4 months lol, which is good for the free world.

Now Freddie Mac suggested mortgage interest to be 6.8 in 2023, that's pretty conservative.

What does it mean:

- The Fed already prevented any crashes from happening, they don't see much deterioration in Financial sector. James is quite sharp when saying 2008 is a banking crisis and not a housing crisis as the banking crisis is the input in 2008
- Fed would still have a higher terminal rate but they may keep indirectly putting the mortgage rate between 5 to 6 thru foreign purchase buyer
- As the layoffs would become lesser and lesser in 2023, we would just have a mild recovery next year
- Although there's a possibility we would have a nice rebound in 2023
- the economy can still go strong even with so many tech layoffs meaning the US economy as a whole is very diversified, for example, the country profited a lot from the commodity boom.
- although the fed could crack the job and manufacturing sector, but housing is so resilient that the Fed admitted they're unable to crash the housing market.

[Carlos Ptriawan]

Quote from @James Hamling:

Quote from @Nicholas L.:

@James Hamling

So, thank you J-Pow, I accept your endorsement of my economic theory, lol. 

The more I understand the Fed, the more I know they're working as politicians rather than economists. So one can't expect them to understand them at face value, but their intention is clear for the company/folks not to keep the increasing price.

 But holy cow the 30YRFRM today is now 6.2 !!!

been telling u folks the most important data is US bond auction data.

[Victor S.]

was he and the rest of the overpaid fed mouth pieces were "brilliant" when touting "transitory" narrative? lol these guys/gals will never admit they were wrong. more than likely jpow, just like benny b, will get his Nobel here in the near future. 

[John Carbone]

https://finance.yahoo.com/news...

Based on responses on here over the last few months, I thought blackstone and the likes would never face pressure to sell? 

[Justin Fox]

As far as housing goes, the cost is too expensive right now.   If buying becomes cheaper then I can shift to build->sell mode.  Otherwise I'll just keep getting 1,000's per month for simply having money and keep trying to buy someone's grandma's house.  All of the easy money I've gotten is due to poor government policy, so I'm all for it lol.  Just got an EBT card for 1,000.00 dollars lmao.  Wish I wouldn't have paid off my student loans.

[Carlos Ptriawan]

Quote from @John Carbone:

https://finance.yahoo.com/news...

Based on responses on here over the last few months, I thought blackstone and the likes would never face pressure to sell? 

 This is all spillover effect from SBF I think. I can't believe SWF like Temasek doesn't even do proper DD to FTX, there're huge losses among the wealthy I guess from VC, crypto investment, and other private placements so the only fund that has positive return to be withdrawn is from real estate backed fund like Blackstone. I guess it's more issue for the investor itself.

[John Carbone]

Quote from @Carlos Ptriawan:

Quote from @John Carbone:

https://finance.yahoo.com/news...

Based on responses on here over the last few months, I thought blackstone and the likes would never face pressure to sell? 

 This is all spillover effect from SBF I think. I can't believe SWF like Temasek doesn't even do proper DD to FTX, there're huge losses among the wealthy I guess from VC, crypto investment, and other private placements so the only fund that has positive return to be withdrawn is from real estate backed fund like Blackstone. I guess it's more issue for the investor itself.

Yeah but many on here said these wealth fund managers are immune from people wanting to exit from them. If housing drops 20 percent, the notional value will far outweigh the value from crypto. The reality is, SBF is a huge event, but it’s a rounding error in the capital markets. 

[Carlos Ptriawan]

Quote from @Victor S.:

was he and the rest of the overpaid fed mouth pieces were "brilliant" when touting "transitory" narrative? lol these guys/gals will never admit they were wrong. more than likely jpow, just like benny b, will get his Nobel here in the near future. 

I think because of their massive influence, but they use 1970s technology to "calculate" inflation (that's why it is so lagging) , and their understanding of the economy is so extremely conservative 1930-text-book in Elon-Musk-era time makes their action would be considered by others as a grave mistake while others touted their action as "hero".

How do you explain to 1st-year economic students that Fed is overtightening and raising the rates for the entire world while the Bank of Japan said we have to print money as much as possible when their inflation is at 40 years high lol? Most BP folks just considered them as "God" that needs to be followed as it seems their theory and action is correct LOL ..... while if you read every Fed chairman statement is having widely different opinions as well.  

This economic world is mostly executed by "faith" and "randomness" lol , if not to say it's all total BS.

[Nicholas L.]

@John Carbone

I read an article in Bloomberg on that Blackstone REIT, and it had the usually squishy language about the market "cooling" and general "pain" and the "search for yield." And this is largely a commercial fund, right?  Apartments, hotels, etc.?  Did anyone in this thread ever say "Blackstone will never sell anything ever?"

Which is to say - and I'm genuinely interested in your reactions too, as I am following this thread to get all the different perspectives - I still don't know what effect all these different factors are having on the market; I'm seeing sellers pull listings rather than drop prices; and new construction still seems to be primarily high end and ultra high end.

[V.G Jason]

Quote from @James Hamling:

And so the shoe drops....... 

"....US economy will suffer stagflation next year, a top strategist says".

Here is a few "highlights" from what the main-stream is now openly admitting:
"US economy will shrink and face stubborn price increases next year", "Our best guess is that we're going to be in a period of stagflation for several months through maybe most of next year". 

You will notice NOWHERE is there any mention of "crash" in any way shape or form, but they DO speak to price INCREASE, in many forms. Directly calling out such, indirectly via saying the inflation is NOT done "inflation threat has not faded", and now out-right calling/forecasting for STAGFLATION cycle. 

Several flooded this posting at start months ago saying the sky was falling, how without doubt National Median home prices would CRASH, at level or MORE then '08', predicting a MINIMUM 20% drop in National Median home values, and some going as far as saying minimum 30% drop. They talked about properties flooding the market, builder/developers going bust, institutional investors dumping properties in mass...... A "Dooms-Day" scenario.          I called them out as being INCORRECT, FALSE and/or just out-right liars, because they were, it was mathematical, YES this was fully predictable and proof is in fact I accurately predicted it many months ago. 

This matters, a LOT because I hope some people learn a lesson here to CHILL THE F-OUT, emotional response is almost always the WRONG response. Unless there is a T-Rex, then yes, freak out and run Forest RUN! 

Look, 2008 was a collapse of the FINANCIAL SYSTEM, not housing, not economy, not banking, not beanie babies or anything else, THE FINANCIAL SYSTEM. And that breaking, the expression of a systemic "cancer" that was a ticking time-bomb as Michael Burry accurately predicted far FAR in advance, again because it was mathematical, it had an impact unto all the other sectors such as housing and the economy as a whole. 

From that a long list of FALSE concepts have risen, such as the economy taking a collective "dump" every so many years. Need I remind '08' was the 2nd such "crash" in the ENTIRE history of the U.S., the second, EVER. That is far from any kind of "cycle". 

This, today, is INFLATION. The U.S. has gone through similar inflationary cycles. The entire civilized world has gone through inflationary cycle. There is nothing new of such, it is not unique. 

When you were 10 years old, how much was a Snickers bar? How much is one today? That's inflation. Did your home value go down in that time? What happened to the price of assets, be it a house, a car, a bar of gold? 

Inflation makes currency purchasing power go DOWN, meaning things or value require MORE to acquire. Did home prices go up 24% last year, or did the purchasing power of a dollar go DOWN 24%? 

You must use your head for more then a neck-weight, look around you, use critical thinking, you DON'T need some talking box to instruct you for every thought, your fully capable of taking in information and forming informed observations, this inflation and it's impact is literally all around everyone all one has to do is open there eyes and think for themself. 

When EVERYTHING goes up in price, you have to ask did every sector, every business have some secret meeting where they voted to collectively raise all prices together, or is your dollar worth LESS. And what happens when that dead-president-art does LESS? What happens to things that humans NEED, value, seek and is of fixed supply? 

Buffet tried to warn the population in mass that this was coming, the greatest transference of wealth in human history. Are you awake yet? 

Illegitimi non carborundum

 Stagflation has been the call into 2022 and for the next few years from the beginning. This isn't new. Tons of people have said this. In the housing market, I think prices in some markets do go up, some go up less than YOY, and some actually go down. But I think rent goes up everywhere, tightening the mortgage:rent ratio that needs to happen to make investors step in and provide liquidity for the people that NEED to sell(the people that are about to be unemployed, have low liquidity, etc.)

And as you said your dollar is worth less. This is why we are going to be a renter's nation for sure.

[V.G Jason]

Quote from @Nicholas L.:

@John Carbone

I read an article in Bloomberg on that Blackstone REIT, and it had the usually squishy language about the market "cooling" and general "pain" and the "search for yield." And this is largely a commercial fund, right?  Apartments, hotels, etc.?  Did anyone in this thread ever say "Blackstone will never sell anything ever?"

Which is to say - and I'm genuinely interested in your reactions too, as I am following this thread to get all the different perspectives - I still don't know what effect all these different factors are having on the market; I'm seeing sellers pull listings rather than drop prices; and new construction still seems to be primarily high end and ultra high end.

 Blackstone is taking a mark to market hit, for sure. But I am not sure they are going to hit the sell button, because once they do they will never be able to get out of from underneath that. I can see them hitting every measure prior, and riding out the wave of depreciating house prices(in some markets) and selling a few in appreciated markets.

And if I'm wrong, cool, I'm a net buyer once I get ahold of my taxes owed in 2022.

[Carlos Ptriawan]

Quote from @V.G Jason:

Quote from @Nicholas L.:

@John Carbone

I read an article in Bloomberg on that Blackstone REIT, and it had the usually squishy language about the market "cooling" and general "pain" and the "search for yield." And this is largely a commercial fund, right?  Apartments, hotels, etc.?  Did anyone in this thread ever say "Blackstone will never sell anything ever?"

Which is to say - and I'm genuinely interested in your reactions too, as I am following this thread to get all the different perspectives - I still don't know what effect all these different factors are having on the market; I'm seeing sellers pull listings rather than drop prices; and new construction still seems to be primarily high end and ultra high end.

 Blackstone is taking a mark to market hit, for sure. But I am not sure they are going to hit the sell button, because once they do they will never be able to get out of from underneath that. I can see them hitting every measure prior, and riding out the wave of depreciating house prices(in some markets) and selling a few in appreciated markets.

And if I'm wrong, cool, I'm a net buyer once I get ahold of my taxes owed in 2022.

This year, All private REIT funds from blackrock , JLL has a return of 8-10% this year, the weakest is GS Real Estate.
It's the only private investment asset class that is still solid and hypothetically safe.

[Carlos Ptriawan]

Some more statistical data :

- 42% of houses do not have a mortgage.
- 92% of houses that has a mortgage, are having mortgages of less than 6%.
- Homeownership rate is actually increasing between Q2 to Q3 2023, from 61% to 62%.

These are more reasons why the housing sector is quite resilient, I just realized it too.

[John Carbone]

Quote from @Carlos Ptriawan:

Some more statistical data :

- 42% of houses do not have a mortgage.
- 92% of houses that has a mortgage, are having mortgages of less than 6%.
- Homeownership rate is actually increasing between Q2 to Q3 2023, from 61% to 62%.

These are more reasons why the housing sector is quite resilient, I just realized it too.

Yeah, all this time the only thing that matters and still does, are the jobs reports. If the economy can handle fed funds rate 5 percent or higher for a full year without impacting jobs too much which in turn could impact those mortgage holders to have to sell to people with higher rates, then we get the soft landing from fed and none of this ever matters

[John Carbone]

Quote from @Carlos Ptriawan:

Some more statistical data :

- 42% of houses do not have a mortgage.
- 92% of houses that has a mortgage, are having mortgages of less than 6%.
- Homeownership rate is actually increasing between Q2 to Q3 2023, from 61% to 62%.

These are more reasons why the housing sector is quite resilient, I just realized it too.

Yeah, all this time the only thing that matters and still does, are the jobs reports. If the economy can handle fed funds rate 5 percent or higher for a full year without impacting jobs too much which in turn could impact those mortgage holders to have to sell to people with higher rates, then we get the soft landing from fed and none of this ever matters. I’m still highly skeptical of the soft landing.