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re: This crazy real estate market
Posted on 1/14/22 at 7:38 am to tigerpimpbot
Posted on 1/14/22 at 7:38 am to tigerpimpbot
quote:
. There is so little inventory and so much demand. But it will pop. It’s just going to take a while since there are so many people moving here from blue states.
Yeah to kind of add to my response to rocket from earlier, the RE market keeps getting propped up by outlier events like this. The CV19 response created this new option of national WFH, which creates a MASSIVE exodus from expensive, blue areas. This is on top of the liquidity printed into the market. These sorts of things can't continue forever.
There are only so many people who are leaving California, New York, and Connecticut and when/if that equity they're leaving with falters (when the inflated prices in the lower cost areas drop), it's going to be painful. Lots of net worths will just evaporate.
1
Posted on 1/14/22 at 7:41 am to GreatLakesTiger24
2007 is why. Sell the bubble now while you can. What goes up can come down. It's all cliche but cliches are based on truth and experience. I've seen 2 real estate bubble bursts. One in the 80's and the one in 2007. Everyone forgets the bubble and crashes and then acts all surprised and hurt when it happens...and blames the government, when it is primarily their own actions that grow said bubble.
Posted on 1/14/22 at 8:03 am to SlowFlowPro
quote:
Yeah to kind of add to my response to rocket from earlier, the RE market keeps getting propped up by outlier events like this. The CV19 response created this new option of national WFH, which creates a MASSIVE exodus from expensive, blue areas. This is on top of the liquidity printed into the market. These sorts of things can't continue forever.
There are only so many people who are leaving California, New York, and Connecticut and when/if that equity they're leaving with falters (when the inflated prices in the lower cost areas drop), it's going to be painful. Lots of net worths will just evaporate.
agreed. it's painfully obvious that it's going to come crashing down and i'm very curious how it's been floating this currently.
obviously everybody is in staff shortages and while conservatives (i am 100% a conservative, but Trump would be dealing with similar, albeit better handled issues) try and play up the supply chain thing, it's not 2008 or that bad... yet, i know something is going to drop.
somebody posted about all the shortages and how this is happening and asked if anybody knew somebody that just quit everybody piped in and said "i know people that have changed jobs, but nobody that just up and left the workforce." so somehow, somewhere, there are people not working. the shortages and jobs report is saying something, but i'm not sure what.
the money printers aren't going brrrr right now, stimulus is over, EITC credits are over, eviction moratorium is over.
How are people surviving?
Posted on 1/14/22 at 8:07 am to 3nOut
I need it to stay up for another year so I can sell and downsize.
Posted on 1/14/22 at 8:10 am to kywildcatfanone
quote:
I need it to stay up for another year so I can sell and downsize.
i'm in a weird state. we chose to remodel a historic home in downtown instead of moving out to the burbs during covid.
could probably sell right now and net $100k+ easy in this market. but then i'd have to buy and eff that noise.
Posted on 1/14/22 at 8:20 am to 3nOut
quote:
How are people surviving?
a. Lots of people realized they can live much smaller.
b. Lots of people are cashing in on their retirements and home equity.
And that's the professional class. The lower class has been getting that child tax credit in advance which can keep them afloat.
Posted on 1/14/22 at 8:23 am to RealDawg
we recently sold our home. lived in it for just a few years. sold in one day for a 27% profit
Gonna buy a smaller property in good neighborhood and use the equity earned to fix it up and eventually flip down the road
Gonna buy a smaller property in good neighborhood and use the equity earned to fix it up and eventually flip down the road
Posted on 1/14/22 at 8:24 am to 3nOut
quote:
it's painfully obvious that it's going to come crashing down and i'm very curious how it's been floating this currently.
How will it come crashing down?
Like 2008 crash or worse?
Posted on 1/14/22 at 8:57 am to SDVTiger
quote:
How will it come crashing down?
Like 2008 crash or worse?
i am not an economist.
it's going to look a lot different. we're not dealing with banks getting bailed out and people that bought too much house.
we have major manufacturing backend things that are in short supply.
my BIL works for Sherwin Williams in their industrial coatings department. every week he is telling shipping companies, oil companies, etc. "i don't have product." he calls his competitors, and they don't either.
what happens when we have major industry continuing their normal operations, but then hitting standstill because they can't coat the inside of a tanker. that tanker isn't necessarily built because we just can't store oil now, it's because we'll need it in the future. people that were contracted to build, coat, ship, install, operate, etc. that tanker are all now on hold.
they still have a job and work right now, but what happens when all of the sudden we don't have ANY of that product available and we can't safely deploy a new oil rig when it's needed.
that's just an exaggerated anecdote of course, but you can apply it to anywhere. i work in network technology. i've had a few, and very few, issues with getting parts for enterprise firewalls from some of my manufacturers. usually results in a few weeks or months shipping delay but it's survivable.
Right now, i have a $1mm project going on with a large school district. They ordered their network equipment from me in September. It normally takes 2 weeks. this time it took 2 months. not killer, but still irritating. equipment gets onsite and i start scheduling my install. they say "hold up. we're building a new data center and all our racks for network equipment are delayed." a month goes by and they get those racks. then i go to schedule again and now they are waiting on a generator. they ordered that generator in July and it has no ship date.
meanwhile, i'm holding the bag with $800k in equipment sitting in a closet in El Paso Texas while my manufacturer wants me to pay for the equipment they sent back in November, but i can't get paid fully for till it's installed, who knows when, because a generator that was ordered 8 months ago still hasn't been even produced nonetheless shipped. my manufacturer is patient, but eventually they're going to want a check.
my company can take a $1mm loss and survive. We can't take 2 or 3 of them.
Posted on 1/14/22 at 8:57 am to rocket31
quote:
you cant hold cash in this environment, or i guess you could but youd be a clown
Yep....
This morning, I was listening to a banker that comes on to WWL every Friday. He was speaking about inflation and he said that if you go to their web site there is a calculator on Savings, Investment, Inflation.
Calculator
The segment was on inflation and how bad it is effecting the economy. Given current conditions (inflation and interest rates) here is the example he gave:
If you save $1000 a month for the next 20 years, you would end up with a net present value of $64K. You are currently getting less than a 1% yield on your money. Inflation is 7%. State and Fed Taxes eat up some of that as well.
Posted on 1/14/22 at 9:00 am to SDVTiger
quote:
How will it come crashing down? Like 2008 crash or worse?
I'd like to know the general consensus of this, too.
We should be buying our first home the first half of 2023, but I have the opportunity to push that out to the first half of 2024 if I need to.
In that year I could likely save an additional 8-10% directly for the home purchase, but if the price increases 10% or more during that time period I essentially pissed money away.
It's incredibly stressful trying to make these decisions.
Posted on 1/14/22 at 9:01 am to 3nOut
Not sure any of what you wrote would cause a RE crash 
Posted on 1/14/22 at 9:09 am to SDVTiger
quote:
Not sure any of what you wrote would cause a RE crash
on a micro-anecdotal scale, sure. it's not a "crash" per se.
i only compare it with 2008, because it's going to something along the lines of, "we wrote checks, we couldn't cash and it's going to affect certain industries."
the difference in 2008 is that the gov told most of those banks/mortgage companies they could and/or HAD to make those bad loans. we didn't necessarily overextend ourselves in our situation, but my company could lose out on $1mm gross sales because some company somewhere else couldn't make a generator.
we're just a small company that clears about 15-20mm a year. the world won't end if we have to shut the doors.
2008 didn't happen because one guy defaulted on his house, it happened because thousands and thousands of people defaulted on their houses.
This post was edited on 1/14/22 at 9:11 am
Posted on 1/14/22 at 9:10 am to thegreatboudini
quote:
It's incredibly stressful trying to make these decisions.
There's an old saying..
Only one person gets to sell at the top of the market
Posted on 1/14/22 at 9:14 am to blueboxer1119
quote:
Fed will increase interest rates at least twice this year to slow it down.
Speculation of course but I read an article yesterday saying to expect 4 hikes
Posted on 1/14/22 at 9:20 am to YumYum Sauce
I'm not trying to sell at the top. I am simply trying to not get complete burned.
Posted on 1/14/22 at 9:21 am to notiger1997
quote:I had a duplex home, a block off the ocean, that came with deeded beach access. After 2004 and 2005 hurricanes, decided it was too remote for me, being in Dallas, to keep repairing. I'd paid $625k for it 3 years before, sold for $875k, and the poor schmuck that bought it from me let it go back to the bank, which ended up selling it for $465k. It's on Redfin now for $1.2 million.
Yeah I know three people that lucked into buying beach front condos at just about the perfect bottom timing and have made out very well on those investments. Damn them.
*corrected dates
This post was edited on 1/14/22 at 9:27 am
Posted on 1/14/22 at 9:29 am to 3nOut
quote:
2008 didn't happen because one guy defaulted on his house, it happened because thousands and thousands of people defaulted on their houses.
It happened causs every consumer got greedy and the banks let it flow
Borrowers bare much of the responsibility
Posted on 1/14/22 at 9:37 am to RealDawg
I bought my house 2 years ago for $179k. My neighbor sold their house for $275k a few months ago. Should I get a home equity loan ?
Posted on 1/14/22 at 2:28 pm to ZenFNmaster
What's driving up the price of homes is demand. It's taking much longer to build houses and they are costing much more to build. Right now in Alabama they state is about 30,000 units short of demand.
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