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re: KB Homes just reported a 68% cancel rate. Their largest Q4 cancel rate in 6 years
Posted on 1/18/23 at 11:03 am to stout
Posted on 1/18/23 at 11:03 am to stout
Do you believe the inventory will sit on the market and put pressure on housing prices to decline, or will large companies like blackrock purchase the homes keeping inventory levels essentially low?
1
Posted on 1/18/23 at 11:06 am to stout
Someone forgot to tell this to the groups building all the houses along Burbank Drive here in Baton Rouge.
Posted on 1/18/23 at 11:10 am to Bayou_Tiger_225
quote:
or will large companies like blackrock purchase the homes keeping inventory levels essentially low?
Blackrock will more than likely be pulling capital from real estate due to redemptions. PE firms might depending on the financing deals they get, but in the present investments in single family rez is completely dried up. And that's before the private market gets bent over by write-downs.
Posted on 1/18/23 at 11:13 am to stout
Good. Hopefully costs to build start easing down in the next 6 months so I can build at a reasonable cost. the costs are just fricking silly right now. I am looking at a 2400 sf 2 story farmhouse on my property and 350k isn't out of the realm to make it nice.
Posted on 1/18/23 at 11:14 am to stout
quote:
In short, homebuyer demand is literally at its lowest levels since the 2008 crash and available inventory is only going to increase
Good news for me
Hate it for anyone that's going to see their net worth take a nosedive though
Posted on 1/18/23 at 11:16 am to stout
Looks like Blackstone is about to buy up a shitload of houses......
Posted on 1/18/23 at 11:17 am to stout
No, no, no. All the talking heads and democrats say the economy is booming. Everything is fine, costs of groceries are down, crime is down, its all great.
What are you going to believe - your own eyes or the democrats?
What are you going to believe - your own eyes or the democrats?
Posted on 1/18/23 at 11:24 am to Aubie Spr96
quote:
We've had the Fed set interest rates at zero for almost 20 yrs
People got addicted to cheap money. You see it everywhere, not just the housing industry.
When I started my company, 20+ years ago, every customer I had paid net 30. Some even paid net 15. Over the past 15 years, terms have moved further and further out. Now, net 60-90 is the norm. I don't have a single customer that pays net 30.
Of course, it was easy and cheap to utilize a line of credit because the cost of capital was cheap, and my customers held my money for an additional 30-60 days.
That isn't exactly the case now, and you could have a ton on small businesses get caught with major cash flow issues as the cost of capital gets more and more expensive.
Posted on 1/18/23 at 11:26 am to stout
Still waiting on the "housing crash" that people have been saying is going to happen for 3 years now. It hasn't. Maybe they will be right in another 2 or 3 years. 
Posted on 1/18/23 at 11:31 am to stout
Probably get a good deal on a Lexus SUV since realtors will be trading down.
Posted on 1/18/23 at 11:46 am to stout
I got a barrage of downvotes when I related my firsthand account of builders calling back prospective buyers with DEEP price reductions. These builders are going to have to take a loss. How big of a loss is the question. Something has to offset inflationary pressure and high interest rates.
Posted on 1/18/23 at 11:49 am to Lsupimp
quote:
I got a barrage of downvotes when I related my firsthand account of builders calling back prospective buyers with DEEP price reductions. These builders are going to have to take a loss. How big of a loss is the question. Something has to offset inflationary pressure and high interest rates.
Maybe it will be easier soon to find people to do some of the renovations I've been wanting to do.
Posted on 1/18/23 at 11:53 am to LSUAlum2001
quote:
On a 30 year fixed mortgage ($240K loan), the total mortgage cost (payment through 30 years) at the lowest rate under Trump is $204,000 lower than at today's rate: $342K compared to $546K.
Monthly mortgage cost is nearly $600 more per month.
we remodeled a 100 year old home in 2020 and refinanced. $250k loan at 3%.
new mortgage is $1400 a month.
i think somebody doing the same with today's rates would be paying around $2k and get less home than we got.
wild times.
that being said, we originally bought the home in 2009 and had another one sit on the market for 5 years before we could sell. felt good to come out on top of the market for a change.
quote:
Maybe it will be easier soon to find people to do some of the renovations I've been wanting to do.
we get killed by the subs during our remodel because they were all more loyal to kbh and drh giving them steady work on 100 houses.
we had 2 subs that were fired and/or walked off the job because they had better steady offers from KBH
This post was edited on 1/18/23 at 11:56 am
Posted on 1/18/23 at 12:12 pm to 3nOut
quote:
we get killed by the subs during our remodel because they were all more loyal to kbh and drh giving them steady work on 100 houses.
we had 2 subs that were fired and/or walked off the job because they had better steady offers from KBH
You are correct. Your one small job takes a back seat to the DR Horton's of the world.
Posted on 1/18/23 at 12:40 pm to Powerman
quote:
Good news for me Hate it for anyone that's going to see their net worth take a nosedive though
Historically housing prices increase 2% YoY. Most upside down right now have a mortgage rate in the 3% - 4% range.
I’d prefer those two factors vs entering the market at 7% over the next 30 years. I do not see a world where rates get back to the 3% and sub 3% area ever again.
BICBW
Posted on 1/18/23 at 12:43 pm to stout
Xiden has a solution....flood the country with people that are used to living in much less.
Posted on 1/18/23 at 12:57 pm to Ten Bears
No shite. I got yelled at for wanting a payment on an invoice currently sitting at 36 days.
Posted on 1/18/23 at 1:23 pm to stout
Fascinating numbers. It says largest cancellation rate in 6 years. Are there higher quarterly cancellation rates on record ? If 2008 peak was 50%, is there a time it was even worse than the 68%? Regardless, this is very, very telling and should show up this summer in the prime buying season.
On a side note, here's hoping boat prices undergo a major correction soon as well. seems like they are starting to in the used market at least
On a side note, here's hoping boat prices undergo a major correction soon as well. seems like they are starting to in the used market at least
Posted on 1/18/23 at 3:39 pm to stout
Investment rental properties, owned by The CCP.
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