Quote from @David Oldenburg:
I think the real estate market gets worse later in 2023. This is due to consumers treading water financially and this has been going on for 2 years and they are out of money. I have a relative who works for a large car repo company and they have never been this busy in their history. There are now 15,000 repos per day in the US (you can use Google unless they have hidden this fact again). Layoffs have been increasing, especially in silicon valley and they are many many companies stating 2023 is going to be bad for them and they may have to reduce staff. It feels like 2007 when the real estate market was holding steady but the consumer was weakening behind the scenes. As the consumer got worse the market went down. Sorry but there are lots and lots of loans and homes upside down and these people will be gone when things get worse and they will drive the market down. In my area of Sacramento there are thousands of upside down FHA loans done over the last 18 months and they were all financed at near 100% with MIP and these are the lowest quality buyers... To say the market "can't" or won't" drop is just as ridiculous as the people who said it in 2007....and there were a lot of them... they were all wrong. I will mark this post and take a look at it in 12 months January 2024.
Agreed. Most people are starting to come around... however, there are still a few outliers that are denying the obvious.
The economy is clearly in a very bad place. The auto industry is only one aspect of the economy we can look at - but what's happening there is clear and undeniable. Same with layoffs, a lot of companies were waiting until the new year to start layoffs. We're going to see a lot more news about layoffs throughout Q1. Inflation is still raging and the continual inflated costs of good and services are starting to wear on people.
Again, when we look at data from the federal government we need to understand that they are not wanting people to know how bad it is. They want to downplay it. For instance the White House was bragging that gas prices are down from an all-time high, but the truth is that they're still a lot higher than what they were when this admin took over.
Unemployment is only one metric, but that's not the whole story.
"While the U.S. labor market remains incredibly tight — with the economy adding another 263,000 jobs in November — around 7 million 'prime age' men between the ages of 25 and 54 are reportedly sitting it out.
'They are affirmatively not looking for work. They've punched out. They're done,' TV host Mike Rowe said, citing research from economist Nick Eberstadt."
Per far left CNN a few weeks ago, "In the year through November, food got 10.6% more expensive, with grocery prices rising 12% and menu prices jumping 8.5%, not adjusted for seasonal swings, the Bureau of Labor Statistics said Tuesday. In that same period, overall inflation rose 7.1%."
Not long ago I debunked James' false claim that wage increases were offsetting inflation, which is 100% not true. This is provable by data from the US Bureau of Labor Statistics and ADP.
Per Axios "The personal saving rate — the share of disposable income left over after spending — dropped to a rock-bottom 2.3% in October, as consumer spending accelerated at a healthy clip." In data that goes back more than 60 years, there's been just one instance of a lower saving rate.
Then, we look at the housing market in the last 6 months, (
please read James, six months), and the trends are clear. Sales volume, loan apps, inventory, and prices. They are HEADING in a certain direction.
We're not there yet, we haven't arrived. That's the mix up with a lot of us here. I'm not saying we're there, but we're on the way to where we're going.
