Covid-19 and the impact on housing. SoCal Home Sales hit an all-time low in May and 4.76 million Americans are now actively not paying their mortgage.
Things are so good in the housing market, that the data from May for SoCal home sales hit an all-time record low. That is right, this was the worst performing May in recent memory in terms of sales volume. This is a critical point because sales volume was already very thin even before the pandemic hit. And what is telling is those that are able to buy, older Americans, are the most susceptible group to Covid-19 if it hits them. Case and point? In Orange County, an area where people are at beaches in mass and in most cases not wearing masks, zero people have died between 0 to 24 according to the latest data. However, 87 percent of those dying are 55 or older (56 percent of all housing units in California are owned by those 55 and older). And these are largely the homeowners in SoCal or those looking to sell and buy. It should be noted that in most real estate cycles, first sales go down, then home values. And for those with historical amnesia, after a shock like this, home values tend to lag the sales hit between one and two years. So the cheerleaders overall seem like the anti-fact crowd that want everything boiled down to a two-minute clip. Things in life are just more complicated.
Fact #1 – SoCal just had its worst May in recent memory in terms of home sales
The SoCal housing market just had a horrible month in terms of home sales. The data is hard to refute:
This is rather clear data here. Sure, you can make the argument that this is largely due to a pandemic and people are probably less prone to having an open house when you have a virus that spreads like wildfire, especially if you are in age bracket where you are more likely to die if you catch it – and this is the group that largely owns property in California. Given that we won’t have a vaccine for some time, we will need to learn to live with this. But will older California owners want people just popping in their homes to scope out the place before buying? I’m not so sure.
Then you have younger Americans that have been smashed by this crisis. We already know that California is edging to a renting majority and people will start voting that way. Some people are unhappy about this and are bitter and angry yet it is hard to fight a trend. Plus, we are going to have some tough choices given that local and regional governments are going to see tax receipts implode. And given we are still practicing crony capitalism for the .1%, it is unlikely most will get a piece of this rentier money manipulation aside from a few bucks in their bank account (most of that has already been used up).
Fact #2 – A large portion of Americans have stopped paying their mortgages
Another reality is that 4.76 million Americans are now not paying on their mortgages. That is not good. If someone has a tough time paying one mortgage payment, try doing three or six all at once. So we are going to see the rubber hitting the road even more so late this summer and fall. There is only so much can kicking you can do.
Given how people are interacting with one another, it is clear we are going to see more cases of the virus in our society. It is hyper focused for damage on those that are 55 and older and these are largely the homeowners in our country. Most people when buying a home want to step in and take a very close look at the biggest purchase they will be making in their life. So how are people going to feel about letting people into their property to look around?
The cheerleading narrative is fighting the battle of the past – that is, home prices are high because you are seeing movement at the margins. Same thing happened when the housing bubble popped in 2007 to 2009. Prices lagged and hit a bottom in 2012 in many locations.
Commercial real estate which is more reflective of business demand is already taking a hit:
Our economy is on a big giant pause:
-Student loan payments are on hold until September for most with government backed loans (what happens after that?)
-4.76 million Americans are in forbearance eon their mortgages
-29.2 million Americans are receiving unemployment insurance
The market is hyper irrational. Just look at Hertz for example. The company filed for bankruptcy and tried to sell more stock into the market because people are just speculating on platforms like Robinhood. In reality, it is likely the stock will be wiped out but there was still demand! This is a textbook definition of the “greater fool†and housing had something like that with the NINJA epidemic – that is, people knew prices were out of control but since some other sucker was willing to buy, why not go for it? This thought process is there today – “hey, just look at these record prices! Therefore it must be right.†That is until the music stops and there are no chairs left to sit on.
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292 Responses to “Covid-19 and the impact on housing. SoCal Home Sales hit an all-time low in May and 4.76 million Americans are now actively not paying their mortgage.”
CA Nightmare – Step right up and get in on the action. 50% off is a myth, 60+% is a fact
https://www.zillow.com/homedetails/2033-Bruceala-Ct-Cardiff-CA-92007/16725255_zpid/
Yah can’t make this up, CA owners will get wiped out in 2021
If you are correct, I will be a buyer. I have often said on this blog that my price point is 12 times the annual rent.
That’s good metric, fairly close to the 10X metric which has been the Mean for 1000+ yrs
that’s close to the metric 10X which is the historical rule of thumb
Really wiped out? I guess none of us have careers or money saved up? You poor fool living in a fantasy land. Renters are more likely to be wiped out than homeowners. Sure many over-leveraged homeowners but not all, I just signed refi documents on Wednesday at 2.75% 30 year fixed with 60 LTV. My mortgage will be cheaper than a 2BD rental and that’s with just me working, wife is a lawyer watching kids at home, she can go back if we need more or I lose my job! Key is I make 5x more than my mortgage with little debt.
2.75%? Can I get the name and email of your loan guy?
Right, because you represent the average home buyer and owner. Most of them I know have so much money they can sit at home with an advanced degree and have only 1 income. That explains the 5M in forbearance.
Walter white, maybe cooking meth with pinkman suits you better than commenting on the housing market with remakes like that…
They don’t give out loans like in 2006. Especially during this “covid crisis†it’s getting harder to get loans. Unless you are a qualified buyer, no house for you.
In my new community everyone has well established careers.
Look them up. United Wholesale Mortgage. Any broker can help. They had as low as 2.5 with some closing costs. I went with zero closing. I didn’t believe it either, previously with Chase and a credit union and they couldn’t match my new rate so I left.
Dude, you realize asking price doesn’t mean much? You think it went down by 50%? You realize the live auction is starting at 1.2M? So close to the beach it might sell for significantly more than1.2M.
M: Dude, you realize asking price doesn’t mean much?
Yet another Milli flip flop. Old Milli would “prove” many of his points by citing asking prices. Others, myself included, told him asking price is meaningless. Now he agrees on that too.
I’ve lost count over how many positions Milli has done a complete 180 reversal.
100% agree!
Take the old Millie, flip it 180 and you have the new M.
Starting price at an auction is meaningless.
Come back to us when the house is sold and THEN lets talk about prices.
It sold for 2.1 million (original asking price 2.5 mil.
Why pay for a rapidly depreciating asset when the Realist will pay your mortgage for you? Don’t be stupid.
Thank you Realist for paying my mortgage!
And the San Diego cpa. Some people just love helping us pay off our assets faster. The best thing is they keep doing it because they will wait until they are 60 for that 50% crash. Lol. We will never run out of renters!
Now is not the time to buy nor sell. Banks are suppose to value their REO to market. I don’t value may house to market, since I live in it and will not have a fire sell. The poor folks in the real estate business will suffer. I just cry for their suffering. We are in a depression.
Same for my stocks. The only value that counts is when I sell every year(4%) for my RMD.
Since I get a big SS monthly checks and a very big CALPERS pension, no worries. The Democrats will print money. My kids will pay the bills. Party on!
Fantastic time to sell. You will most likely get multiple offers / bidding wars!
It’s always a good time to buy if you can comfortably afford it and if it’s your primary residence. You won’t regret buying, it will be the best investment you ever make (most likely).
We’ve been waiting for the crash since 2012 when Jim Taylor first predicted a quick and mighty tank. I’ve already asserted that there’s more money sitting on the sidelines than anyone knew of. There still is. Why. Because there’s so many damn people and a more than healthy proportion have set money aside. A lot of money. So I don’t worry about a cataclysmic downturn. At least not in decent and safe area.
Why would you be waiting for a tank in 2012???
That was the tank, huge drop, 2012 was the best time time buy in the past 20 years.
Now you need to wait until about 2023-2024. You need to have patience.
Hehe, his story changed quickly. Now it’s 3-4 years out….
This year we will see prices actually continue to climb.
Historic low inventory, historic low rates and bidding wars.
There’s no “tank†coming anytime soon. Housing inventory is at all time lows, mortgage rates are at historic lows, and there is do much money and pent up demand on the sidelines to keep in inventory low and prices high for many years to come. On top of that, baby boomers will be retiring and/or dying in the next decade or two and will be passing down approximately $65 trillion to their heirs. Those beneficiaries will almost certainly put a lot of their inheritances into housing. In places like So Cal, where there is no buildable land left, inventory will just get tighter. If you really want to be a homeowner and can afford it, now is probably as good a time as any to buy a home.
+1
Spot on…..glad a few people get it.
Step right up and be the next fool to buy in CA – Business
San Diego home sales plummet to level not seen in nearly 30 years
The median home price in San Diego County is $590,000. This was a home for around that same price on Watson Way last summer.
The median home price for a house in San Diego County is now at $590,000. This was a home for around that same price on Watson Way last summer.
(John Gibbins/The San Diego Union-Tribune)
San Diego home sales continued to slump during the COVID-19 pandemic. Sale price remains about the same.
By Phillip Molnar
June 18, 2020
2:38 PM
Housing sales in San Diego County had their biggest annual drop in nearly 30 years in May as COVID-19 brought the market to crawl.
There were 2,327 home sales in May, down 40.7 percent from the previous year, said CoreLogic data provided by DQNews. Analysts point to a lack of consumer confidence and sellers pulling homes off the market to wait out for a better selling time as reasons for few transactions.
It represents the biggest annual drop in home sales since January 1991 when sales were down by 41.5 percent.
A Fool and his Money are soon Parted, please come again.
Will you be buying my home after I lose it all? Please save me!
You are by far the least educated commenter on this blog. All you do is blurt out a bunch of garbage with zero substance. I’ve been 100% right about the state of the housing market so far and will continue to see things play out exactly how I envision them to because I base my analysis on facts. At this point I only come to this blog to see what wacky zany thing Realist is going to say next. I really wish the Doc would feature you as a contributor on his next blog post. I think you both would make a hilarious team! 🤣🤣🤣
You were spot on…..below 1M in OC is selling like hot cakes
500-700 in San Diego county is flying off the shelves within days.
The market has been this hot since 2013.
A friend of mine (realtor) just made the zip code record. Multiple offers, highest price ever recorded.
And no end in sight…..we have no inventory.
Realist
“ and sellers pulling homes off the market to wait out for a better selling time as reasons for few transactions.â€
I agree with you and the article.
Historic low inventory. Plus historic low rates.
Q1 would have been a great time to buy while buyers were scared. Now, buyers aren’t scared anymore.
For below 1million, expect multiple offers on SoCal.
Good luck!
Here is a chart showing TLT (long treasury Bill ETF vs JNK (ETF for high yield corporate aka “Junk”). See what happened as the virus struck? I say what goes up must come down, and the spread between the two must narrow. TLT = 1.77% yield, JNK 5.66% current yield. (If it doesn’t come up hit DRAW CHART.)
https://bigcharts.marketwatch.com/advchart/frames/frames.asp?show=&insttype=Fund&symb=JNK&time=9&startdate=1%2F4%2F1999&enddate=6%2F22%2F2020&freq=1&compidx=aaaaa%3A0&comptemptext=TLT&comp=TLT&ma=0&maval=9&uf=0&lf=1&lf2=0&lf3=0&type=64&style=320&size=4&x=57&y=6&timeFrameToggle=false&compareToToggle=false&indicatorsToggle=false&chartStyleToggle=false&state=13
The fed is to start buying corporate debt, and how much will be high yield, I don’t know.
Pending sales in Southern California are up 6 weeks straight and back to pre-coronavirus levels. The Doc concedes low May sales could be a virus hangover, which seems to be the case.
Pending is like saying you are kinda pregnant, sorta pregnant, just a little pregnant. LMAO, good luck with that.
I think I just lost the last little bit of respect I had for “realistâ€.
What took you so long M? Realist never had any respect. All he does is talk out his pie hole without any substance whatsoever. People with half a brain see how utterly useless he is on this blog.
New age,
You are right. Realist is a lost cause.
For the price of a middle class Brentwood crapshack, you can buy vast mansions in Phoenix or Spokane.
What nearly $2.5 million buys in Brentwood: https://www.redfin.com/CA/Los-Angeles/1015-Amherst-Ave-90049/home/6760643
What nearly $2.5 million buys in Phoenix: https://www.redfin.com/AZ/Phoenix/106-E-Country-Club-Dr-85014/home/101812499
What $2.1 million buys in Spokane: https://www.redfin.com/WA/Spokane/2208-W-2nd-Ave-99201/home/169896227
Brentwood versus Spokane versus Phoenix.
Dont be silly.
Look up the term: Location, Location, Location.
You must be Dr Obvious. Of course that delta exists and it always has. If someone was to offer you a choice of any one of these three houses, your pick, which one would you choose? I can see it now. “ yes, dear, it’s one third the size (one quarter?) but it’s in the affluent Westside. The weather is perfect and did I mention the beaches?†I don’t think anyone, including you, would give Spokane or Wichita, whatever, a second glance.
The layoffs for home owners in CA haven’t even started in earnest yet.
That will happen when PPP is curtailed.
So far the pain has all been felt at the lowest economic levels.
This recession will be far worse than 2008/9.
Housing will take at least 3 or 4 years from now to bottom. You need patience.
“This recession will be far worse than 2008â€
Rofl!!
I agree. The instant gratification crowd is missing the fact that these things play out over a longer period of time. As you said, 2 Years and we are in a solid downtrend and the pendulum swings slowly. 10-15 years roundtrip.
ON the other hand, this home in NoHo was listed at $795K and sold for $815K.
Imagine that, North Hollyweird
https://www.redfin.com/CA/North-Hollywood/5831-Morella-Ave-91607/home/5161647
The house near me is now 38 days on Redfin and is listed as Pending. No longer taking backup offers. It was sold the weekend it was listed. It probably should give the final price by day 45 (one week from now). It is a classic ’60s working class 3 Br on a reasonably big lot (aka crapshack to many of you), and is worth as much (or more!) as a 4000+ sq ft mansion outside Minneapolis.
Nonsense. People over 55 are at risk of getting this fauxflu & are fearful of allowing potential house buyers into their homes for fear of contracting it?? These must be the same fools who wear their masks in bed.
Waiting for a vaccine? Really? People are waiting to take Bill Gate’s vaccine? lol
People are more likely fleeing the cities because they seek an escape from the overreaching, dictatorial policies now being forced upon them by their local governments. Or because they simply cannot afford their homes anymore.
People are more likely fleeing the cities because they seek an escape from the overreaching, dictatorial policies now being forced upon them by their local governments. Or because they simply cannot afford their homes anymore.
Or it’s to get away from all the “overwhelmingly peaceful protests.”
As someone standing on the sidelines in the Bay Area for many years, I welcome news like this. But I am not holding my breath. Sales figures had been trending downward pre-pandemic. But the markedly lower May sales figures are heavily attributable to the shutdown. The fact that liquor sales in bars plummeted during the same time period does not mean we’ve all decided to stop drinking.
As far as the postponed mortgage payments, I believe we CAN kick the can further down the road, and we will. Anecdotally, people stayed in their homes post-2008 financial crisis for years, rent free, as the banks postponed posting a loss on their balance sheets, then got bailed out. If foreclosure was ever undertaken, which I understand was not the usual, that process took years to finalize. The idea that we will see substantial price drops as a result of the pandemic is wishful thinking…this is especially true in the sub $1M range. Please tell me I’m wrong, I want to be.
The supposed flight from the cities? Maybe that will have an effect, but I’m also skeptical. RE agents have been quoted in “news” articles lately, alleging that sales activity is skyrocketing in the exurbs, mountains, etc., due to increased telework and the recent urban unrest. But to me it seems unlikely that qualified buyers have gone through the entire process in that short of a time frame, ie, once the shutdown started, they decided to up and leave the city, list and sell their homes, and purchase a new one in, say, Napa Valley or Lake Tahoe. Can it even happen that quickly?
But to me it seems unlikely that qualified buyers have gone through the entire process in that short of a time frame, ie, once the shutdown started, they decided to up and leave the city, list and sell their homes, and purchase a new one in, say, Napa Valley or Lake Tahoe. Can it even happen that quickly?
Not for most people. But for the super rich, those who can buy expensive homes for all cash, yes, it can happen that quickly.
Per the Dr. article:
“ Therefore it must be right.†That is until the music stops and there are no chairs left to sit on.â€
People need a place to live. They either rent like our SoCal CPA and pay 36k a year to someone else or they buy.
There already is no chair left. Literally. How many houses are for sale in your neighborhood, Your community, Your city, in your state?
Not enough for sale and it gets worse and worse. Homeowners sit on a gold mine.
Unless you change lending standards and let houses be bought by people who cannot afford them you have no issue. Most renters predicting the crash don’t have the income or the 150-200k downpayment to buy that nice house.
They can buy a smaller house further away or they keep renting. Welcome to reality.
In Europe that has been a reality for decades.
Millie, unfortunately I think you are right. I have been pounding the table for almost a decade about supply and demand regarding RE in CA. We are currently several MILLION units short. With an ever increasing population and all the regulations and no or slow growth policies…this is the end result. And for the areas most people want to live in, there is simply no land left to build on.
I welcome the 60% haircut some of these geniuses are predicting. If that comes true, you’ll have even more renters in this state. This people with money will buy up everything, myself included.
“until the music stops and there are no chairs left to sit on.”
Perfect closing remark and pretty much sums up the current economic situation. Everyone with basic reading comprehension and internet access can figure out the recession/depression has started. Right now smart money is dumping assets (example: large hedge funds) and stupid money is buying them (example: Robinhood investor). The music is about to stop playing. One can argue it already did, but a lot of people are making excuses that someone just paused the music because of COVID-19.
The houses will be much cheaper soon. If you are planning to buy, don’t! You will be the one left standing when the music stops.
Just drove through LA.
What a laughable 3rd world country style city this is.
Smog is back. Traffic is back. Homeless everywhere. Gas station has no working bathroom. 7/11 says they don’t have a bathroom. McDonald’s, finally a bathroom.
I would hate to live in LA. Unfortunately I have to drive through it once in a while.
Now you sound like the Old Milli. Welcome back.
My dislike for traffic and density, smog and stuff hasn’t changed. I like it a bit more rural
Chaz3@ “But to me it seems unlikely that qualified buyers have gone through the entire process in that short of a time frame, ie, once the shutdown started, they decided to up and leave the city, list and sell their homes, and purchase a new one in, say, Napa Valley or Lake Tahoe. Can it even happen that quickly?”
People who buy vacation homes in places like Aspen, Lake Tahoe, Park City etc., most of the time they don’t need a loan; they buy with cash. Even if they borrow, the loan might be from a HELOC on their main expensive home. Regardless, they can close within few days if they want. Those houses are millions (i.e. in Park City, UT most SFH are over 5 million). Nobody gets a mortgage there. Mortgages are for working class not for those buying their forth or fifth home to have a place where to park their money.
Fair enough re the ultra wealthy who buy homes with cash in Aspen, but the movements of those people don’t constitute a “mass exodus” from the cities, as has been reported. And the percentage of those people who did not already have a 2nd / 3rd / 4th home, and are supposedly buying now, is smaller still. And Tahoe is not Aspen, let’s be clear about that. (I love Tahoe, BTW)
My frustration is with hyperbolic statements meant to excite or scare or pressure me one way or another. In other words, real estate marketing.
Housing prices are totally fake. They are twice as high as they should be because of past and present fraud. The FBI has sent people to prison for raising entire neighborhoods of homes to triple the value they’re worth. Now we’re told that it’s back to normal when it was never normal in the first place. These scum bag realtors, bankers and government officials are all involved and know it’s wrong.
Kent@ “These scum bag realtors, bankers and government officials are all involved and know it’s wrong.”
The realtors do not have anything to do with real estate prices – zero influence (if you understand how the system works); they are just price takers like you and I. Bankers, unless you are at the very top to be a FED shareholder, again have zero influence. EVERYTHING in terms of RE prices is caused by the FED. Yes, the local authorities play a role with their policies in creating a price difference between various locations. However, overall, for the US market, prices are caused by the FED for whatever benefits the FED. When I say the FED, I am not talking about the federal government, but the Federal Reserve – as federal as Federal Express and with no reserves – the money printers of the largest banks cabal who own the FED. Yes, the FED knows the consequences of their actions, but they are there to serve themselves, not you and I. The best you can hope is to position yourself to be in the right place at the right time financially, so you can benefit from their actions at least a little bit.
Poor realtors are as hopeless are you are to ever buy a house in Belair or Beverly Hills.
From Logan Motashami:
Current housing data doesn’t reflect the true fundamentals of the U.S. market
There should be asterisks on the March, April and May data due to stay-at-home orders
As mortgage rates stay low, I expect a rebound in the existing home sales data line in time. Don’t be surprised if we see a positive year-over-year growth print in the existing home sales report in the upcoming months. Housing data gets softer when mortgage rates get above 4.5% – outside stay-at-home orders, of course.
Full article here
https://www.housingwire.com/articles/current-housing-data-doesnt-reflect-the-true-fundamentals-of-the-u-s-market/
Foreclosure TSUNAMI Coming, Housing to Tank Hard in 2021- Mortgage Delinquencies Surge To Nine-Year High
Property research firm Black Knight Inc. reports total borrowers more than 30 days late surged to 4.3 million in May, up 723,000 from the previous month. This means at least 8% of all US mortgages were either past due or in foreclosure.
As Before, CA Will Be Ground Zero, CrapShacks 40% Discount Coming
Americans Not Making Their Mortgage Payments Soar By 1064% In One Month
https://www.zerohedge.com/economics/americans-not-making-their-mortgage-payments-soar-1064-one-month
If You Purchased A CrapShack in CA Recently, You Are About To Get Bent Over, With No Lube, OUCH
LMFAO
Here Comes The Next Crisis: Up To 30% Of All Mortgages Will Default In “Biggest Wave Of Delinquencies In History”
“This is an unprecedented event,” said Susan Wachter, professor of real estate and finance at the Wharton School of the University of Pennsylvania. She also points out another way the current crisis is different from the 2008 GFC: “The great financial crisis happened over a number of years. This is happening in a matter of months – a matter of weeks.”
Enjoy that weather CA, it’s about ALL you got left.
So Much for Those Application Numbers- Mortgage Market Meltdown: Even The Wealthiest Loan Applicants Are Now Being Turned Down By Lenders
The global pandemic has mortgage lenders steering away from even their wealthiest clients, as fears are abound that lost income could turn the industry’s best clients into its biggest risks.
Jumbo loans, which got their name because they are bigger than most conventional mortgages, have completely fallen out of favor with lenders – a far cry from how they were looked upon just months ago, according to Bloomberg. Availability of jumbo mortgages is down 37% in March, more than double the overall home-loan market. They exceed the limit for government backed mortgages of $510,400.
Rates for jumbo loans were 3.68% last week, which is almost 30 bps higher than the average conventional rate. The spread is the highest since 2013. Jumbo borrowers were previously seen as welcome clients, generally with great credit, money in the bank and collateral to put up.
Tendayi Kapfidze, chief economist at LendingTree Inc. said: “Before this crisis hit us, jumbo loans were pretty attractive. But because they don’t have the government guarantee, a lot of those loans end up on the bank balance sheet.â€
Lenders are charging more for these types of loans than they have in almost seven years. At the same time, they’ve tightened lending standards, requiring almost pristine credit to get a mortgage.
People like David Adler are finding out that refinancing isn’t at easy at it seems, either. David, with excellent credit, went to lower his 3.7% rate on his home but his bank’s rates were too high to help. Adler said: “I told the guy at the bank, ‘I’m trying to use logic here,’ And he said, ‘That’s your problem.’â€
Wells Fargo ranks among the highest jumbo loan holders, producing about $70 billion of the mortgages last year.
Over the last couple of weeks, the bank has stopped purchases from other mortgage banks and limited refinancings to customers who have $250,000 or more with the bank. Banks like Truist Financial Corp. and Flagstar Bancorp Inc. have taken similar steps.
Stanley Middleman, chief executive officer of Freedom Mortgage Corp. said: “Much of this pullback is because investors who’d normally buy these loans no longer want them. Whether the assets are good or not good is irrelevant because there’s no liquidity to buy them.â€
And the banks may be on to something. It turns out that wealthier buyers look just as likely to stop paying their mortgages as and regular buyers. 5.5% of jumbo loans, about 131,000 borrowers, have asked to postpone payments due to a loss of income.
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But the jumbo market hasn’t totally dried up – it’s just getting more difficult to close loans.
Damon Germanides, a broker in Beverly Hills, says you can fall short of qualifying “despite good credit and owning a business that’s doing well during the pandemic because it’s deemed ‘essential’.”
Borrowers that were ready to put up 20% may now need to put up 30%. “A month ago, he was a no-brainer. Now he’s 50-50,†Germanides concluded.
Oh The Pain, It’s Just Begining
It Just Keeps Getting Funnier & Funnier- 30% Of Americans Didn’t Make Their Housing Payment In June
A stunning 30% of Americans didn’t make their housing payment for June – a figure that is likely going to ripple through the housing industry in coming months. According to a new survey by Apartment List, the rate is similar to May and shows that even though other industries are rebounding, the situation has not yet improved meaningfully in housing.
These figures stood at 24% in April and 31% in May, before falling slightly to 30% in June. One third of the 30% in June made a partial payment, while two thirds made no payment at all.
Yup, Nothing to see here, ISN’T THE WEATHER JUST BEAUTIFUL 🙂
Rents started declining nationally:
https://www.cnn.com/2020/06/16/success/rents-are-dropping-us-cities-coronavirus/?hpt=ob_blogfooterold
This is just a start. The US economy is expected to shrink by 8%, while output across the 19 countries that use the euro could decline by 10.2%. If you think real estate will appreciate in this environment, I cannot help you.
Buying in CA is like Buying a ticket on the TITANIC – From Housing Wire. “California is seeing rents decrease in several areas. According to RealPage, operators in Los Angeles cut rents by 3.3% in May 2020 compared to May 2019. Oakland, California saw an annual loss in effective asking rents of about 3% in May. Bigger cuts were seen in San Jose at 4.4% and in San Francisco at 4.9%, RealPage said. Executed new lease rent has dropped at least 8%, which is double the norm in the U.S., in Boston, Detroit, New York, Salt Lake City, San Francisco and San Jose, California.â€
“In San Francisco, one-bedroom rents have dropped 9.2% since June 2019, according to SFGate. Boston has felt the impact from universities and colleges being out, as about 65,000 students live off-campus, the Boston Globe said, and rent is down 2%. Asking prices have also dropped, for the first time since the middle of 2010.â€
The San Francisco Chronicle in California. “Summer in the Bay Area usually brings a flood of interns, students and new workers who fill spare rooms and snatch up months-long Airbnb vacancies. But this year, the coronavirus pandemic has upended the once-hot Bay Area housing market and kept people at home, leaving landlords bereft — and some renters on the hook for payments from subletters who never showed. A survey from the San Francisco Apartment Association estimated that 7.5% of renters in San Francisco have broken their leases in the past three months, an unprecedented number.â€
“Companies in the business of short-term rentals are also having difficulties. Airbnb laid off a quarter of its workforce in May, and Sonder, another hospitality company headquartered in San Francisco, had major layoffs in March. ‘There’s been a lot who have just kind of disappeared, mailed in the keys, and just vacated, sometimes with furniture left there,’ said Sarah Yaussi, vice president of business strategy for the National Multifamily Housing Council.â€
“The slack summer demand from students and interns likely will evolve into a more serious problem for the rental market as a whole in the fall if students do not return, according to Krista Gulbransen, executive director of the Berkeley Property Owners Association. ‘The summer’s just shot. So for someone to go longer than the summer on a vacancy just to see if the students come back in January is probably not realistic and doable,’ Gulbransen said.â€
From Socket Site in California. “The percentage of homes on the market in San Francisco which have undergone at least one official price reduction is currently running around 21 percent, which is six (6) percentage points, or roughly 39 percent, higher than at the same time last year. And with inventory levels up 60 percent on a year-over-year basis, there are now over twice as many reduced listings on the MLS in the absolute than there were at the same time last year.â€
The Los Angeles Times in California. “Retired football player Carson Palmer has finally sold his custom home in Del Mar for $18 million, according to the Multiple Listing Service. The wood-clad contemporary had been on and off the market since 2015, when it first listed at $24.995 million. In May, the median sale price for the area was $1.439 million, down 23.4% year-over-year, according to CoreLogic.â€
CA slowly sinking into the abyss
lmao, yah just can’t make this up – Housing Rebound? Under Armour Founder Unloads Mansion At 41% Below Asking Price :0
https://www.zerohedge.com/markets/housing-rebound-under-armour-founder-unloads-mansion-41-under-ask-price
You sound like Old Milli. As I’ve often said (and as New Milli agrees), asking price is meaningless.
What’s meaningful is comparing actual sales prices. Is the latest sales price higher or lower than the previous sales price? That’s how to detect if there is a crash, a plateau, or a hot market.
It is Millie… all same person including JamesJim. You’re being trolled.
“…Under Armour Founder Unloads Mansion At 41% Below Asking Price…”
Here is the part I have never understood. If these people are so damn rich, why do they have to unload anything? Fake people with fake money using too much leverage?
Realist, drawing conclusions out of asking prices are very amateur-like.
Take this example for instance:
Buffett sold his Laguna beach house for 7.5M. The asking price was 11M.
So you celebrate and say the market is crashing because it sold 32% below asking?
In reality, Buffett bought the place for 150k and made a killing with his deal – 32% below asking price.
You get the idea here? Asking price doesn’t mean anything. Especially not for luxury properties.
The point to consider is that sale prices are declining not increasing. A significant drop in prices could erode equity for many.
Homeowners can have their property re-assed when prices fall which lowers their taxes?
Homeowners can buy a second home when market prices fall?
Count me in and please wake me up when prices have declined 5%.
Just a few more months right?
The most likely scenario: People can inherit money and build their first home. : )
Don’t see much of a tax savings by reassessing lower property values. I wouldn’t be surprised if all tax rates, including property taxes, are increased to cover increasing government debt.
Very few homeowners will be in a good position financially to purchase a second home regardless of price. Many will be struggling to kept their primary home.
Is the V shape recovery complete?
If so, that tells us that unemployment has killed the working class who arent buying homes anytime soon……or is this guy hitting the pipe to hard???
https://www.housingwire.com/podcast/the-v-shaped-housing-recovery-is-complete/
It’s hard to argue against him as he bases his statements generally on data. He had many articles lately that are worth reading.
Purchase application data, st Louis Financial stress index, inventory, 10y treasury yields and mortgage rates, equity in homes, etc, etc.
Another practical approach is to ask realtors about the current state of the market. It depends on the location.
SoCal housing market for instance is sizzling hot and no end in sight.
M: Another practical approach is to ask realtors about the current state of the market.
You expect realtards (as Old Milli called them) to tell you the truth? For a realtard, it’s always a great time to sell, and a great time to buy.
Pls discontinue to call real estate agents this word. These agents are trying to make a living by turning houses into homes for people. I have learned a lot from real estate agents over the year and they supply me with data and market insights. Try to give them a chance. Finding a great agent and maintaining that relationship over years can make you money.
In the 92115 zip code in San Diego there are very few sfr’s for sale. Every realtor I know is saying the same thing, there’s no inventory. This has a huge affect on the total sales. This isn’t to say things are rosy as they are anything but rosy. People aren’t selling and builders spent the last 10 years building COVID cubes with nice gyms for the millennial crowd. Now that they got stuck in a box for 2 months and had the spouse chirping in their ear the whole time they’re desperate for the white picket fence and swing in the tree. The tards running the cities and states could only think two things, small cubes of people stacked on top of each other and public transit. Once the little millennial misses starts popping out the rug rats she ain’t gonna want to be downtown anymore, too. Of course houses are in demand. No building of them, no existing inventory coming onto the market, inner cities being burnt, and locked up in boxes for two months, what did you think was going to happen?
Millennial here.
Great post Bob. Couldn’t agree more.
A realtor I know just made the all time high for a sale in one of San Diego’s zip codes.
No inventory and historic low rates means prices can go nowhere but up.
I recently bought a brand new construction home in north county San Diego. Commute is short and the beach isn’t too far. Yet, there is no density where I bought.
I compared it to existing houses and found new construction is relatively cheap considering all the advantages a new construction has over existing homes.
I am looking to buy a fixer SFH in a decent area as an investment property. Unfortunately, I have little hope to get a deal. Too much competition. People grew up with HGTV and are more open to buying a fixer and “making†their home the way they want.
It comes down to what has been said thousands of times by hundreds of people over the years: we have a severe housing shortage.
New construction is generally cheaply made and shoddily put together. They are built by piece workers who make money in volume, hurrying through each house quickly, Using shoddy workmanship and Shoddy materials. (Half-inch drywall throughout)
Has been this way for decades. The builders idea is to turn a profit, not to go broke using decent materials. You would have been much better off buying a solid older home, rather than shoddy new construction
Rick, thank you! I needed that laugh!
The house is in fantastic condition and the top line materials were used. We watched it being built which is a cool experience itself.
Don’t be jealous that you can only afford old crappy fixer crapshacks. My new house is top of the line with all the bells and whistles.we couldn’t be happier. Let other people have fun with the bidding wars on older crapshacks. I got my dream home and warranties.
No reason for me to rip out walls, we have an open concept with mega large island and great room, loft, granny flat and 3 car garage. Should I keep bragging?
Haha! I knew you’d take the bait Millie.
Let’s face it, your inheritance bought you a new crap shack rather than an old crap shack and you bought at the peak. Lol. Me thinks thou protest too much.
M: We watched it being built which is a cool experience itself.
Okay, now we know you’re lying.
Early this year, you were still the Old Milli, predicting a crash. Then, seemingly overnight, you announced that you inherited money, bought a house, moved in, and found a perfect tenant. Now we’re expected to believe that you even saw the house being built?
You expect us to believe that, within the brief span of time between the Old Milli and New Milli posts …
* Your relative died. You were informed that you inherited money. The estate went through probate, taxes, and you received the final check.
* You negotiated and purchased a home that was still under construction. You watched the building process, which was still so incomplete that you were able to inspect all the materials.
* The house was rapidly finished, from largely incomplete to move-in ready.
* You then moved all your stuff from your old place to the new house.
* You interviewed prospective tenants and found the perfect one, who then moved in.
All this in the brief span of time between the Old Milli and New Milli posts?
I love taking bait. That’s what I do.
There are those that can afford a NEW home at the PEAK and then there are those that can afford to buy a crapshack when prices fall.
So far everyone loved my new house. Throwing covid party after covid party.
Just kidding. Obviously, every guest is wearing a hazmat suit and we all keep 6tt distance.
Those that say they don’t build new houses like the old ones are actually right.
Nowadays they build much better.
People like Rick can only afford old Cars and tell themselves “see, the old cars are much better, I can still do my own oil changeâ€. While the millennial drives a Tesla that doesn’t even need an oil change 🙂
“Then, seemingly overnight, you announced that you inherited money, bought a house, moved in, and found a perfect tenant. Now we’re expected to believe that you even saw the house being built?“
Dude, what are you talking about? Getting the inheritance money took a year. Why should I post online that I am in the process of getting inheritance money??? btw there is still money tied to one of the houses we are in the process of selling.
If you don’t believe me that we saw our new house being built, sent me your email address and I will send you the pics.
Who said my tenant is perfect?
“Bought a house and moved in†are you okay? What else am I supposed to do after buying a house…. not move in?
M: Getting the inheritance money took a year. Why should I post online that I am in the process of getting inheritance money???
* Why should you? Well then, why did you? Why mention it at all?
* Most importantly, a few months ago you posted that you received an inheritance which enabled you to buy a house which changed your whole way of thinking.
Are you saying that you learned of your inheritance a year ago, yet all this time you retained your Old Milli views, predicting a crash, opposing Prop 13, hating “realtards,” etc.
If your inheritance changed your thinking, it should have changed when you learned of it a year ago. When you learned you could afford a house, and that Prop 13 would benefit you. Instead, you remained Old Milli up until early this year, then changed 180 degrees in an instant.
You know California has rent control (AB1482, which right now doesn’t affect SFH owned by individuals, but Prop 10.2 aims to change that, plus there’s a slew of socialistic policies going after landlords in “the State will take your property” kind of way), and you want to become a landlord in CA?
Either you have no clue, or you like to lose money.
Not sure what your struggle is.
I had a lot of cash and inherited on top of it. I would be flat out dumb to not buy real estate. Yes, it took me a long time to get here and I am no more on the bull side than on the bear side. Making the decision to finally buy changed a lot of things for me and I finally see the truth.
Buying in SoCal is a must. Don’t try to time the market. Buying names ALWAYS sense as long as you can comfortably afford it. Renting long term is financial suicide.
M: Not sure what your struggle is.
I thought I was clear.
Your new financial circumstances should align, time wise, with your new opinions on housing. The former inspired the latter. That they do not align, suggests that you’re lying.
Consider two scenerios:
1. Early this year, you opposed buying a house before a 50-70% crash. You hated Prop 13.
A few weeks later, you announced your inheritance, a change of opinion on all things, and a sudden home purchase.
It’s not possible for you to have inherited, seen a home built and completed, bought it, moved in, and found a tenant, within a few weeks. Ergo, you’re lying.
2. Now you say that you learned of your inheritance a year ago. This allows time to clear probate, buy a home still under construction, view its completion, move in, and find a tenant.
But if that were so, you would have changed your opinions on the crash, Prop 13, etc., a year ago. Not this spring.
Busted.
Trevor, I bought a large house with granny flat. Renting out the granny flat to a single person. Pays a nice share of my PI.
At the moment I have trouble justifying buying another property as rental income.
I am also looking at the IE and out of state.
Will see….eventually I get my investment property.
Reading Son of a Landlord completely and utterly dismantle little “m” has been glorious. What a scam artist m is!
Seek mental help, man. There are doctors and medications for this.
My new theory is that M is the same as Mr Landlord
Mr Landlord disappears and M appears? Coincidence?? I think not.
The friendly banter between Mr Landlord and Our Millennial was just a game last year.
This educated all of us on the Bull and Bear side of the story. Thank you, M!
M is not an engineer but is a famous Broadway actor who was auditioning for his next play. Bravo M! I hope you get it! Break a leg!
“ But if that were so, you would have changed your opinions on the crash, Prop 13, etc., a year ago. Not this spring.â€
No. Money alone did not change my opinion. I already had money before the inheritance. The difference was I worked and saved hard for my money and I couldn’t pull the trigger to buy a house. I wanted a crash to buy low.
But, inheriting a bunch of money made house buying EASIER for me. As soon as I made the decision to buy, my opinion changed. And I think I got this right now. In SoCal you buy when you comfortably afford it.
None of your Sherlock homes investigation makes sense or proves anything. People can change their mind…..it happens due to circumstances.
Bob,
I am not me landlord. Mr landlord is a good weather commentator. He will be back when the stock market is back to an ATH. Mark my words.
I actually share a lot of mr landlords opinions now.
Me landlord did not believe that I bought a house….many won’t. They don’t believe in people changing so rapidly. Inheriting money and deciding to buy high wasn’t easy for me but much easier than using my downpayment money that I saved and worked hard for.
M: “Inheriting money and deciding to buy high”
Well at least he’s admitting he bought high lol.
Son of a Landlord – I think your theory may be correct. “M” is the perfect cover for Mr. Landlord.
I actually said many times that some people can afford to buy high and some people have to wait for a crash. I could comfortably afford to buy in 2020 and had no competition.
But who knows if the market will be higher by year end or not? Right now I see bidding wars and no inventory.
Buy when you can comfortably afford it!
M: I actually said many times that some people can afford to buy high and some people have to wait for a crash. … Buy when you can comfortably afford it!
Actually, you said many times that only idiots buy at peak. That smart people buy low and sell high. Smart people wait for a crash, and rent until then. Good memories and fun can as easily be created in a rental as in an owned house.
But now you claim that you bought a house while it was being constructed, which means you bought last year — the same year that you were claiming that you refused to buy a house until a 50-70% crash.
That is correct!
I watched it being built end of last year and moved in this year.
Yes, I changed my mind. I am now a bull but used to be a little bit more on the bearish side.
Some people can afford to buy new. Some people have to wait for a crash in order to buy their first house. It’s hard for some people to deal with it – I understand that. It won’t change anything. I will continue to provide you with stats about the housing market.
In fact:
Job market is continuing to recover
Stocks show a V shape but have ways to go
Purchase application data up YoY
Expected market time in hot market territory
Very little inventory, historic low rates and high demand means the market can only go up
Etc etc
It’s so much more fun to be a bull!
M: “I actually said many times that some people can afford to buy high and some people have to wait for a crash. I could comfortably afford to buy in 2020 and had no competition.”
Not everyone who chooses not to buy now in CA is unable to. The old you had the right idea, IMO…
Bob: “Actually, you said many times that only idiots buy at peak. That smart people buy low and sell high. Smart people wait for a crash, and rent until then. Good memories and fun can as easily be created in a rental as in an owned house.”
And not everyone planning to buy in CA is renting. Some are owners (mortgage-free, even) in states with a lower cost of living where saving cash is easier.
M – If you had not bought before the pandemic, would you now? Did receiving your inheritance change your mind about buying or were you seeing something else in the data? I’m not sure how an inheritance would change my plan. I guess it would on the amount.
“ M – If you had not bought before the pandemic, would you now? Did receiving your inheritance change your mind about buying or were you seeing something else in the data? I’m not sure how an inheritance would change my plan. I guess it would on the amount.â€
I probably would not buy at the moment if I hadn’t. Unless I would find a good fixer. The turn key homes below 1M have multiple bidders at the moment in my area (greater San Diego county).
The market is a bit too hot. I’d like to see more inventory.
Receiving the money and not buying was hard to justify. I believed the market would go higher. I did not see a pandemic coming. I was also debating if I should put a good chunk into the stock market….thank goodness I didn’t do that.
interest rates started dropping tremendously. I thought, fuck it, I really like the floor plan, location Etc. I am Going for it.
Seeing how less inventory there is and how low rates are, I am glad I bought. And not only that. We absolutely love the house. Had our first party here. If the house value drops so what, we still love being here every minute.
I wouldn’t mind a house market price drop in the next few years. If I continue to be in a good financial position I will go for my first investment property.
Thanks, M. I’m satisfied. And for whatever it’s worth, I believe you. Folks, ask yourselves who would lie about receiving an inheritance? There’s nothing impressive about that. A liar would probably say they generated it all on their own. M reached a point where he was comfortable buying, so he did.
That’s actually how it works for every sane person. In my case, I could manage a CA-sized mortgage but I’ve become accustom to living totally debt-free in TX, so I’ll keep saving and watching prices. At some point prices will drop and/or I’ll have saved enough to be comfortable buying in CA..
The price is not that important if you love the home, you’re planning to stay for a long, long time and you’re not stretching yourself thin. Easier said than done in CA.
Turtle, it’s not the claimed inheritance. It’s not about changing his mind. It’s the multiple contradictions in his various claims and time lines.
I’ve listed many. I’ll repeat just one:
M claims he bought a house last year. Or, as he later claimed, put a deposit on a house last year.
Yet all last year, and into this year, he was saying he’d never buy a house before a crash.
So he was either lying then about his refusal to buy a house (when he’d already bought one), or lying about now about having bought a house.
His tales are full of contradictions, i.e., lies. And if a man’s caught lying about some things, who know what else he’s lied about? His job, his age, whatever. The whole M persona might be fiction.
Son of a landlord,
You are the one being full of BS.
First of all you keep putting words in my mouth that I never said/wrote and second – and most importantly- this was a drastic change to go from bear to bull.
I had to admit I was wrong and that process didn’t happen overnight.
Buying a house was the best thing for me and I am happy to admit I was wrong before.
Reading zerohedge and hoping for a big crash to buy in low doesn’t work during a housing shortage and low interest environment. Not even a pandemic can bring the market down.
Sry buddy. Move on. I start to feel sorry for you.
M: you keep putting words in my mouth that I never said/wrote and second
Which words?
Did you not post, endlessly throughout 2019, that you would never buy a house until there was a 50-70% crash?
And did you not later claim that you were in the process of buying a house in 2019, inspecting materials, putting down a deposit?
This millennial demand you speak of cannot sustain current price levels. These millennial COVID box dwellers did not have the incomes to create any reasonable demand even before COVID pricked the economic bubble,, which was all fueled by unsustainable levels of debt by the way. The demand before all this came from foreign money, institutional money, rich boomers moving into SoCal, millenials inheriting trust funds. A lot of this is gone now. Now you have a weird situation where people don’t have to sell YET, because they think things are going back to normal. They aint. The old normal is gone and people will start selling at big discount, because they will have to.
Could be, but money has always moved to San Diego. We don’t just draw in San Diego millennials but draw in money millennials from all around. No question, though, that these are interesting times. Things will go up for a while but invariably this won’t end well.
I’ve been deep diving on Massachusetts Unemployment Insurance. CA has borrowed $2.7B from the U.S. Treasury (at 2.41% I believe). MA will probably end up owing at least $3B by the end of the year. Paycheck taxes going up next year are a certainty from that alone.
The Fed is certainly trying to buy up any troubled debt, but in doing so has driven interest rates to zero where all debt seems to reside these days, from risk-less Treasuries to muni debt. Lake Wobegon, every debt is below average risk. March told us people ARE thinking 10% is what they want for most bonds. Eventually they’re run over the credit markets again. Can the Fed hold the line again?
In addition to “crap shacks”, many people are holding a lot of “crap bonds”. When interest rates rise they will be pummeled. You’ll have boomers living in houses at 50% of their value in 2022 and their bonds near the same. Millenials will finally have their way 😉 I have kids. So silver lining!
The main point I want to make is the UI data says practically NO ONE is getting their jobs back. When the 2nd qtr earning season hits, I expect 5% white collar workers to lose their jobs. At some point in 2021 I believe we’ll be at 20%+ unemployment.
Like you say, this takes time. I just wanted to point out that you can look at UI debt for a no escape financial stressor. The DOL reports weekly and the U.S. Treasury reports State borrowing daily. As for tax revenues, delaying payments is really a way to hide the damage to the public.
https://maxdatabook.com/massachusetts-ui-borrowing-calculations/
And here’s an article I wrote on Medium if you don’t mind my posting:
https://medium.com/@maxrottersman/get-your-sh-t-together-massachusetts-bf197c51a14b?source=friends_link&sk=70938e2fca0cac9a6f84ce6d4c3a5ba8
A few mistakes you made in your post:
Don’t fight the FED
Interest rates are not rising significantly anytime soon
Low wage earners: it’s fire and hire. They got laid off and can be re-hired in a second.
Take a look at the saving rates during covid. People are “dying†to spend their money.
Have you taken a look around at restaurants, Lowe’s, Costco lately?
I am on vacation in my favorite state (California) at our favorite lake. I haven’t seen it so busy since years. It’s just a matter of time until we have a vaccine. Buy up all the stocks you can when that happens. The FED has printing like there is no tomorrow. We might get some inflation which benefits homeowners and stock holders – greatly!
I don’t think CA housing prices will drop that much in the coming years. Maybe 25% at the most. There is a housing shortage, plus also no one wants to leave SoCal’s sunny weather for less desirable areas. Buyers will always come in to buy, no matter what. I lived in CA over 30+ years. The RE market will just bubble and pop, and bubble again, over and over.
Here’s an interesting article:
https://www.thebalance.com/when-will-housing-prices-drop-again-4773140
It’s definitely cyclical, or at least has been in the past. If 25% is as low as it goes then that’s somewhat reasonable for CA. Maybe a tad high. The weather comfort is indeed unbeatable in the US, except maybe Honolulu for those of us who like some rain and shades of green (wish SoCal had more of that).
“plus also no one wants to leave SoCal’s sunny weather for less desirable areas.”
You might be surprised to learn that people are leaving in droves and have been for a long time now. Cleaner places with good jobs, better homes, less crime, lower taxes and tolerable roads exist. Family and weather are the main reasons we intend to move back. When we fly to SoCal from Texas it’s like we enter the plane in 2020 and exit in 1994. Much of SoCal just looks “old”.
I recommend that everyone who was born in SoCal live somewhere else for at least a year just to understand that while it is a special place, it is not a place that the rest of the country looks at as the pinnacle of civilization. Whatever the movies portray, the opinion of SoCal from outside the state is generally mediocre. It makes sense for people with better than usual means but otherwise you get the short end of the stick overall, IMO.
I don’t think CA housing prices will drop that much in the coming years. Maybe 25% at the most. There is a housing shortage, plus wants SoCal’s sunny weather. Buyers will always come in to buy, no matter what. I lived in CA over 30+ years. The RE market will just bubble and pop, and bubble again, over and over.
Here’s an interesting article:
https://www.thebalance.com/when-will-housing-prices-drop-again-4773140
Nice little article, THAT TOTALLY MISSED IT. This isn’t a recession, its an economic collapse, a depression, one of the likes we have NEVER been thru, SO YOU HAVEN’T SEEN IT ALL.
Buckle up kids, you are about to get slaughtered, especially if you purchased a house in 2020.
Keep telling yourself it’s gonna be ok if that gets you thru the day, I’m sure you saw this coming.
At the age of 19, I worked as a roofer in CA around 1980 before the 2000-and-up run-up. I see what you see. I just went and did a quick calc on my Uncle’s house. I believe he bought for around $30K in 1970. In today’s inflation dollars that’s $200K today. He died, my aunt recently sold for around $500k. Yes, that’s a nice return, but not as nice as people probably think it. He almost lost the house in one of those CA recessions. Was not risk free 😉
What I wanted to point out to you is some economists see small and large debt cycles. Since the Great Depression we’ve been going through small debt cycles. The Pandemic may bring on a reset of the large debt cycle, the last of which was 1935-1940. (coming anyway, even without the virus IMHO).
In short, you, me, may soon see what our grandparents saw, but which we didn’t live through. This pop will be a long-debt cycle POP.
Here’s a nice video on the subject: https://www.youtube.com/watch?v=PHe0bXAIuk0
Back to Reality- Just Another Boom-And-Bust Cycle, Although The Bust Is Happening At Lightning Speed
From Hollywood Life in California. “HollywoodLife EXCLUSIVELY spoke with four experts in the high-end house market. Q: On average, what percentage do you think Kylie and Travis saved by purchasing a home now? Katie: ‘Kylie Jenner’s home was first listed last summer at 55 million and she purchased it for 36.5 million. She did an outstanding business move by purchasing her home for 18.5 million less than the original list price. Travis Scott got his home for a steal when it was originally listed for $42 million and he purchased it all cash for $23.5 million. An amazing decrease of $18.5 million.’â€
“Q: Do you think they (Kylie and Travis) got a good deal? Yawar: ‘One thing I will say about today’s market is that there is room for negotiation. We have literally been in transactions where we have been able to renegotiate terms after escrow has it opened. This really wouldn’t have been possible six months ago. Overall, I would say there are certain sections of the luxury market where someone can save 10 percent-15 percent on pricing since the pandemic has hit.’â€
That 10-15% OFF Is Just The BEGINNING 🙂
Nice try. Your examples were $50M homes whose value is based on the whim of the 1%.
Show price drops on sub Million dollar homes then we can talk. We are not seeing price drops yet of more than 5%.
LATE MORTGAGES TRIPLE IN CALIFORNIA, HOUSING BUBBLE 2.0, HOME PRICES, FORECLOSURES, FORBEARANCE
If you Purchased in CA, You are about to LOSE Your Down Payment in EQUITY
https://www.youtube.com/watch?v=gmzii4Q3tqw
New home prices went up over 4% in May!
https://fred.stlouisfed.org/graph/?g=s8Mw&utm_source=twitter&utm_medium=SM&utm_content=stlouisfed&utm_campaign=eea412d3-63f2-40a1-b273-eb29cc6226d4
The house on my block, one last post:
The new owners moved in and are doing an extensive remodeling themselves. Big dumpster in front and loud hammering and sawing all weekend. Father-in-Law seems to be helping out with it. They paid full asking price. The new kids are playing around the cul-de-sac.
The Los Angeles Times in California. “If you’re feeling cramped in L.A., here are homes with more than 4,000 square feet on the market for roughly $750,000 in Lake Arrowhead, Oak Hills and Fontana in San Bernardino County. Lake Arrowhead: Amenities in this price-reduced retreat include a vintage movie theater, sauna, wine cellar and a garden with a stream and koi pond.In the 92352 ZIP Code, based on 29 sales, the median price for single-family homes in May was $390,000, down 8.6% year over year, according to CoreLogic.â€
“In the 92344 ZIP Code, based on 24 sales, the median price for single-family homes in May was $318,000, down 3.8% year over year, according to CoreLogic. In the 92336 ZIP Code, based on 52 sales, the median price for single-family homes in May was $483,000, up 2.7% year over year.â€
From Realtor.com:
“What Is a Cul-de-Sac? A Dead End That Draws Home Buyers in Droves”
Yup, if You Purchased or Own in CA You Are Fooked- A report from Medium on California. “Jurdon Gold had been a renter almost his entire life. Born Oakland, Gold, like many in the Bay Area, had never lived in a house he or his family owned. That changed in 2015, when he and his wife began looking for a new place to live after their wedding. Originally planning to rent, the couple couldn’t find a place they could afford in the East Bay. As they began looking further afield, and made peace with the idea of commuting, they spotted a townhouse for sale in Vallejo, about 25 miles north of where Gold grew up.â€
“The mortgage that far from pricey San Francisco was something they could afford, too. Without ever planning it, the two became homeowners. ‘We kind of fell into it,’ Gold said.â€
“The couple’s time in their first home would prove short-lived. Gold’s wife got a postdoc position at Stanford University, diagonally across the San Francisco Bay. To avoid a three-hour commute that involved crossing multiple bridges, the two moved 50 miles south and began renting in Hayward. They quickly found a tenant for their Vallejo home.â€
“It was 2019, and Gold was now both a landlord and a renter. Thanks to the insanity of the Bay Area housing market, the rent in his new Hayward home was more than the mortgage payment in the Vallejo townhouse. ‘Our mortgage in Vallejo is $1,440. Our rent out here in Hayward is $2,950. So it’s literally double,’ Gold said.â€
“Then came Covid-19, which, less than a year after Gold became landlord, kicked off the most dramatic face-off between landlords and tenants in a generation. Throughout the spring, Gold watched his social media fill up with friends posting the hashtag #CancelRent and encouraging people not to pay their rent, even if they could still afford to. The posts were often accompanied by tirades against landlords.â€
“Gold struggled to get his feelings straight. He knew a bad landlord could ruin a person’s life, and what the active threat of eviction felt like. Gold also knew another fact to be true. He and his wife would quickly go bankrupt if their Vallejo tenant were to join the rent strike. ‘We’re living pretty much month to month. We wouldn’t be able to afford our own rent if our tenant stopped paying,’ said Gold.â€
“That tension is something Manuel, a young landlord who asked me not to use his real name in order to speak freely from the owners’ perspective, is grappling with. One the one hand he gets the politics of #CancelRent, just as the activists say they are sympathetic toward him. On the other hand, owning property for him feels like a personal accomplishment.â€
“Manuel was able to borrow enough money from friends and family to afford to buy his own place in Oakland. Today he sees the home he lives in as his retirement, and a fulfillment of the dream that brought his parents to immigrate. ‘Personally I’m a pretty socialist person, but I also understand these things in a capitalist way,’ he said. He has a mortgage to pay, and one of his roommate-tenants has been getting later and later on rent. Manuel said he’s been okay floating his roommate for now, but he knows he could lose his Oakland home if the roommate doesn’t eventually pay.â€
“The one thing that could get small homeowners like Gold and Manuel on board with #CancelRent is the way activists have also pushed for a mortgage cancellation. ‘In that case I’d totally be on board,’ said Manuel.â€
From CBS Los Angeles. “This week, both Los Angeles and San Bernardino counties extended their eviction moratoriums for another month through the end of July. While this move provides relief for tenants struggling to pay rent, some mom-and-pop landlords are now struggling to pay their bills. Homeowner Nasario Birrueta and his wife thought they were getting their dream home when they closed on an Apple Valley home back on March 12.â€
“‘We put in a bid of $15,000 over their asking price to get the house,’ Birrueta said. The couple also agreed to a 30-day leaseback so the previous owners would have more time to move out. But when it was time for them to move out, the previous owners sent a text saying, due to the shelter-in-place order, they are not moving out. ‘I offered them $5,000 cash if they want to move out by mid-May, but they didn’t respond,’ Birrueta said.â€
“Now, more than three months after the Birruetas purchased their new home, they still can’t move in. They say the previous owner only paid one month’s rent and hasn’t paid a dime since. ‘There is a very good chance we may end up losing the house to foreclosure if this continues any longer,’ he said.â€
“Mike Shalyapin is one of those small landlords. He owns two duplexes in downtown L.A. and was in the process of evicting one of his tenants when the stay-at-home order went into effect. Now, according to Shalyapin, those tenants have stopped paying rent. ‘I was laid off from my other job, so the only source of income I have right now is from income properties,’ he said.â€
“Tenants in California don’t have to prove economic hardship due to COVID-19 and they have 12 months to pay their rent back once the emergency order is lifted. ‘My credit cards are maxed out. I don’t even know how to pay for my mortgage bill next month, and at the same time the city demands property taxes,’ Shalyapin said.â€
The Los Angeles Times. “It wasn’t until the work was done that Marcelino and Josefina Rodriguez said they learned the truth. They had been signed up for a roughly $45,000 PACE home improvement loan at nearly 10% interest — even though they said a woman working with the contractor told them their new roof and water heater would be free through a government program.â€
“The Rodriguezes contacted the authorities, but the nearly $4,500 annual bill came due anyway — a financial hit for the household of four who scraped by on less than $30,000 each year as garment workers paid by the piece. If they didn’t pay, Marcelino, 67, and Josefina, 64, could lose the Pacoima home they’ve owned since 2001, one that provided them and their sons stability after years of bouncing from rental to rental. So to get by, they started selling food and one of their sons said he exhausted his savings.â€
“It was working — until the coronavirus slashed their incomes. ‘I don’t know how we are going to pay,’ Marcelino Rodriguez said in Spanish through a translator. To lose the house ‘would destroy me.’â€
“As the economy struggles to recover from coronavirus-induced damage, consumer groups are raising concerns of a coming foreclosure wave stemming from PACE home improvement loans. For years, the industry has been dogged by allegations that some home improvement contractors exploit a loan approval process with weak safeguards to mislead people into financing they can’t afford, by telling them either that work would be free or that it would be less than it ultimately cost.â€
“Consumer attorneys say they were seeing PACE-driven foreclosures even before the current crisis and now fear a surge as the recession cuts off economic lifelines for people already living on the edge. ‘Our clients, who were barely holding on financially, are now falling off a cliff,’ said Stephanie Carroll, an attorney with Public Counsel, which is representing the Rodriguezes.â€
“Before 2018, PACE loan eligibility was largely based on home equity with no required analysis of whether the applicant had the income to repay the loan — a step mandated for mortgage loans. Contractors could use lender systems to look up exactly how much a homeowner qualified for, allowing them to pitch products that would strip all available equity. Homeowners could then sign up on tablet computers that contractors handed to them and borrowers didn’t always need to speak with lenders to confirm they understood their financing.â€
“Complaints were particularly high among seniors and people who didn’t speak English. Some homeowners alleged contractors didn’t show them all the documents and even set up fake email addresses where loan documents would be sent and then forged. Nearly 145,000 loans worth $3.4 billion were outstanding at the end of 2017, before the laws took effect, according to state records. And consumer groups say the rules are still too lax, pointing to allegations of fraud such as those made by the Rodriguezes, who received their loan in 2019.â€
“‘Any time you don’t have an ability to repay analysis, there is a greater chance people will be in loans that are unaffordable,’ said Tara Twomey, an attorney with the National Consumer Law Center. ‘What the PACE assessments take away is any cushion or breathing space to handle any setback.’â€
“Public Counsel’s Nisha Kashyap, who is representing the Rodriguezes, said PACE lenders are required to verify a homeowner’s income and the fact her clients received a loan suggests something ‘went wrong in the approval process.’ ‘This loan should not have been approved,’ she said.â€
“Marcelino and Josefina Rodriguez haven’t received a foreclosure notice but have an underlying mortgage and fear they’ll eventually lose their home. ‘It’s been a year of hell,’ Daniel Rodriguez said. ‘The damage that this stress can cause, that’s what worries me the most.’ Marcelino Rodriguez called what has happened to his family an injustice: ‘They always told me everything was going to be free.’â€
I’ve noticed that many home listings are now erasing their price histories. Several properties that I’ve followed on Redfin had price histories going back a decade or more, and suddenly they only go back a few months to a year.
Zillow used to be more complete on price histories, but they too are erasing past histories.
I’ve been noticing this in San Diego for about a year now. I’m sure it’s not because they want to hide anything.
I remember looking at home prices online 5-7 yrs ago and it was common to show price histories.
Then when flipping got hot n heavy (2013-2015) many brokers put in lots of effort to delete price histories in order to hide the house was flipped and hide the fact that the purchase price prior to flip was so low.
Seems that the practice of deleting price history is rampant now.
Because all history – even price history – is raycis?!? Seriously, not happening in my area but I’m seeing many many high end properties come on the market that were vacation rentals and bought within the last 3 years. In a few cases people are asking DOUBLE what they paid. Most are asking 20% or so – even if bought last year! Interestingly, those who bought at the last peak are happy to get out flat or a little off.
With all the competition these people are going to be CRUSHED, mwah ah ahhhh
I just finished reading “The Great Influenza” by John Barry.
This was about the Spanish Flu Pandemic on 1918 that killed 675K US citizens from Spring 1918 to Summer 1919. It killled 20M worldwide.
A lot of similarities between then and now.
1) The US economy shut down. Quarantines, businesses closed due to sick people and fear. Same as now.
2) That flu pandemic killed everyone at all ages. It killed quickly and suddenly. unlike now.
3) Hospitals were overloaded and many died in hospitals without any antibiotics at that time. Better modern medicine and ventilators now.
4) The overall death rate was estimated between 2-5% . The death rate for the native Eskimos in Alaska was 30-50%. The virus was delivered in the mail boats.
Some horrific facts:
1) It killed about 5-10% of all people in Philadelphia. Parents died and since nobody wanted to go into a home out of fear, their children died of starvation in the homes.
2) Federal government did very little but local charities set up food banks.
3) Businesses all closed like now. People were told to wear masks or stay at home.
4) Gunnison Colorado had no cases since they set up armed guards around the town and shot or arrested anyone entering.
5) Someone spread a rumor in Phoenix that dogs spread the virus so everyone shot and killed their pet dogs.
6) The shops that stayed open had an interesting method. Nobody was allowed in the stores in Monument Colorado but you yelled from the street what you needed and it was thrown out the door to you.
7) In much of the US, if an entire family died in a house, police put a sign on the house to prevent entry. Bodies just rotted inside.
Same economic conditions as now but there was no recorded recession or housing crash in 1918 or 1919. People dealt with it and died of it for about a year and then the virus went away.
None of the authors of the early 1920’s mentioned it. F Scott Fitzgerald, Hemingway.
It lasted about a year and was gone without a vaccine with very little economic impact after it passed.
I am betting that the same will happen now since Covid is far less severe than the 1918 Pandemic. It may be shorter than a year if a Covid vaccine is available.
Katherine Anne Porter wrote “Pale Horse, Pale Rider” about the 1918 pandemic. It was published in the 1930s. She wrote in the ’20s but was not well known until much later.
Thank you, joe R.
I will read that next.
Bob, you did not see all before. I lived under socialist democrats (aka communists) and they behaved like the socialist mayor of Seattle. The tyrants could destroy private property from individuals and businesses but not the party bosses property. The socialists in CHAZ destroyed private property, raped, killed children and the Mayor said it is just “love and peace” and “Summer of love” till her 6000 sf house (8 mil. value) was threaten to be urned down.
I guess the leftist Democrat useful idiots (Antifa/BLM/SJW’s) just did not realize they were not permitted to attack the Democrat establishment (Mayor Jenny Durkan or her $8 million house), a member of the party of slavery, the party of the KKK, the party of Jim Crow, the party which opposed the Civil Rights Act of 1964, and the party which even now attempts to keep them on the Democrat Plantation for their votes. This lady acted like the other socialist democrat governor from Michigan; when her husband wanted to set his boat on the lake and he was refused per governor’s orders, she lifted the interdiction – orders from socialists are just for others not for themselves. They can not suffer in any way. I’ve seen this all too well before while growing up.
I hope the socialist democrats of Seattle learned a practical lesson, but I don’t hold my breath for it – you need brains to learn something and the liberals in Seattle fried their brains with drugs.
Sorry you missed living in a socialist democrat utopia close to home – CHAZ. Now, like all other socialist utopias it failed. They told Trump they are against the wall, but the first thing they did was to raise walls; same like Pelosi with a high wall around her compound. Also, the other hypocrite socialist democrats from Minneapolis they defunded the police but spent the taxpayer money for private security for themselves – in other words, black lives killed in the city and black businesses destroyed in the city do not matter, but their lives do. How do you say “hypocrites” in socialist democrat “CHAZ”?!???….
Come on, Flyover….
History is against you. FDR saved our great country from disaster and the Republicans by implementing Democratic Socialism. Social Security, Government infrastucture improvements, a safety net for the great farmers and workers of our country.
Communism does not work but Democratic Socialism does work.
I am looking forward to the Biden Presidency to save our great country.
Seen It:
James Roosevelt was Franklin’s closest confidant among his children, and one of his strongest defenders. He also supported Richard Nixon, Jimmy Carter and Ronald Reagan for president. He definitely rejected the idea that his Dad was a Socialist.
As Norman Thomas (leader of American Socialists) said:
“Emphatically, Mr. Roosevelt did not carry out the Socialist platform, unless he carried it out on a stretcher. What is true is that when Mr. Roosevelt took office he had to act vigorously.
We had demanded Federal relief for unemployment. Hence any attempts Mr. Roosevelt made at Federal relief could perhaps be called by his enemies an imitation of the Socialists platform. It was an extraordinarily poor imitation. We demanded Federal unemployment insurance. Hence any attempt to get Federal security legislation could be regarded as an imitation of the Socialist platform. It was an amazingly bad imitation.”
If Trump said;
“No business which depends for existence on paying less than living wages to its workers has any right to continue in this country.â€
The Republicans would have seizures and start foaming at the mouth.
However, when Biden and Bernie say it, they are called Democratic Socialists.
Based on this, Democratic Socialism is where this great country should be heading.
If Trump said;
“No business which depends for existence on paying less than living wages to its workers has any right to continue in this country.â€
The Republicans would have seizures and start foaming at the mouth.
However, when Biden and Bernie say it, they are called Democratic Socialists.
Based on this, Democratic Socialism is where this great country should be heading.
this is completely nuts….inventory continues to DECLINE in SoCal….last year at this time it was at 44K active listings….today its at 26k…..that means no crash in Q3. bubble boys have to hope for a miracle and skyrocketing inventory. Otherwise there is no way for prices to not go up further.
Purchase application data is up 15% year over year now …. WOW!
Closing DOWN 21% YEAR over YEAR ….. OUCH, Especially if you purchased in CA lmao
If You Purchased in 2020, well, U FOOKED- A report from the Wall Street Journal. “The new coronavirus epidemic in New York obliterated the spring selling season, according to a Wall Street Journal analysis. Apartment sales were down 54% in the second quarter compared with the same quarter in 2019. That was the lowest total since 2005, the first full year the city made available data for all co-ops and condo sales. And, according to Brown Harris Stevens, a real-estate brokerage, 90% of those sales were in the works before the virus hit. The median price of a Manhattan apartment was $1.01 million, down 21% compared with the second quarter in 2019.â€
“Donna Olshan, a broker who closely follows the luxury market, said there was no way to predict where the market will go in the middle of a pandemic. ‘There is no data that tells me this is a positive situation,’ she said.â€
The New York Post. “Grammy Award-winning musician DJ Khaled has sold his South Florida home for just under $5 million. The producer was in contract to sell his three-story home at 3914 Island Estates Drive in Aventura in March. But the New York buyer fell sick with the coronavirus and decided not to close, sources said.â€
“Then the price dropped. Originally asking $7.99 million in 2018, the home was last asking $5.5 million and will close for around $4.87 million. Khaled bought the five-bedroom home for $3.84 million in 2015, then spent $2.5 million on ‘extras.’â€
The Real Deal on Florida. “Eastdil Secured founder Benjamin Lambert sold his Fisher Island condo at a loss. Lambert and his wife, Linda, sold their three-bedroom, 3,592-square-foot condo at Oceanside in Fisher Island for $4.85 million, property records show. Lambert and his wife bought their Fisher Island condo for $5.4 million in 2014, $550,000 more than what they sold it for.â€
From Good Day Sacramento in California. “For the last few months, bills have been piling up for Sonia Rodriguez. ‘We can’t pay the rent. We can’t pay our car payment. We can’t pay our bills,’ Rodriguez said. ‘It’s just too much, we’re going to be back-paying for years to come. I went from potentially buying a home to — I’m at a standstill.’â€
“If landlords and property owners don’t receive rent, some can’t pay their mortgages. Experts, like Joshua Howard with the California Apartment Association, say this could lead to dire economic consequences. ‘When rent goes unpaid that creates a domino effect, that can ultimately lead to them losing that rental property to foreclosure,’ Howard said.â€
From KQED in California. “San Francisco’s temporary eviction ban is under threat. On Monday morning, just two days before rent checks are due, landlord and realtor groups filed a lawsuit in San Francisco Superior Court to suspend the city’s temporary eviction moratorium. ‘This law, along with the closure of the court system, would allow renters to live rent-free from March 2020 to potentially September and beyond,’ said Noni Richen, president of the Small Property Owners of San Francisco Institute. ‘Property owners would have no legal recourse to recoup unpaid rent. Small owners are particularly hard hit by renters who cannot pay.’â€
Enjoy the words NEGATIVE EQUITY, you are gonna hear them a lot from loan jockeys. DENIED!
I’m trying to buy in San Diego (already own a 3bdr condo) and I just watched a property I was about to make an offer on go pending after 4 days on market. Then the house I did put an offer on had 16+ other offers. I’m not going to participate in a bidding war, but to all those who think the market isn’t frothy, think again. I haven’t seen it this on fire since 2004-2005, but this time inventory is less and there is no toxic financing. It’s here to stay as long as the fed continues to print money and housing continues to be at a shortage.
Nailed it!
That might be San Diego. I see no fire sales in Los Angeles, including in Santa Monica. Properties sitting for a long time.
Because inventory and interest rates are the only two factors in the equation. Lol.
And high demans
The only people buying at these prices are those that have to buy. Bummer for them that inventory is low and prices are high but that is only evidence of many that don’t have to sell, yet. Also remember, we are still in the spring/summer season which is usually the yearly peak. Highest ever unemployment, salary reductions, bruised consumer confidence, consumer spending cutbacks, end of stimulus, continued Covid threat, social unrest and Godzilla, will all be a dark cloud over residential real estate for the upcoming years. Maybe.
Incognito, have patience.
Wait for Covid Round 3 in the Fall and early Winter. It will happen, housing prices will drop 20-30% and the Fed will lower mortgages even more.
If you are old enough, think of today as when the latest Beanie Baby (Tulip if you are really old) is finally released. There was a lot of pent-up demand then and now.
Wait until the pent-up demand passes and you will get 20% off at a lower mortgage rate.
As Our Millennial used to say, Buy Low and Sell High.
Don’t be THAT person who missed out in 2009/2010. But don’t be a fool. When this virus passes in Summer 2021, housing prices will go to the Moon as Mr Landlord suggested.
Waiting 6 months is not a long time to wait for your Forever Home.
If you own a home, 15 year rates are now at 2.5%. Refi now! If they drop to 1% in the Fall/Winter, Refi AGAIN!
My famous quote on mortgages was from a mortgage broker in the late 1990’s. I refi’d from a 7.25% loan down to 6%. Tremendous relief for me on my payments.
When we closed, he said “I hope to do business with you again”.
I said ” Are rates dropping more???” 🙂
He said ” I hope not or this whole country is in trouble”
I said “But I’ll be doing better”
A Q1 stock market crash like we have seen in 2020 doesn’t come often in one’s lifetime! I bought a ton of stocks as I have mentioned in Q1 and even bought a a house.
People like SoCal guy predicted I will lose a ton of money.
Now those bears got very quiet….
Or remember the San Diego cpa that predicted stocks will crash again?
That job report must hurt them:
https://apple.news/AbTRlcI0WRD-lD-WbpB8oYg
That’s the problem with perma bears….even if they get the buying opportunity they don’t buy and wait for lower prices…..missed the boat….again
M: A Q1 stock market crash like we have seen in 2020 doesn’t come often in one’s lifetime! I bought a ton of stocks as I have mentioned in Q1 and even bought a a house.
You bought a house Q1 of this year?
But you earlier said that you watched your house being constructed. It was in such an incomplete state that you inspected all the building materials during construction. Which means you bought it last year, when (you now say) you learned of your inheritance.
But here you switch yet again, say that you bought your house in Q1 of this year?
The problem with lies is that whenever a discrepancy is found, you must add new lies to explain the old lies. Eventually the story becomes ever more ludicrous.
You remind me of Basil Fawlty: https://www.youtube.com/watch?v=F2s3oZLrHgU
Rofl, the only thing you are dismantling is your ignorance.
You obviously have never bought a house. Putting down a deposit is not actually buying. You have to close, which is right he before you you move in….that’s when you bought a house!
Pls keep this going, it’s shows everyone how incredibly silly you are.
M: Rofl …
One of the easiest things to fake is an internet laugh. Anyone can type LOL or ROFL or even ROFLMAO even as they’re nervously sweating.
Anyone who’s parsed all your conflicting claims over the past years sees the contradictions. It becomes obvious that you’re lying. Your bio is fake. Do you even work in IT? Do you like in the San Diego area? Are you even married? How old are you, really?
M: Putting down a deposit is not actually buying.
So now you claim that you put down a deposit LAST YEAR — while you were still saying that you would never buy before a 50-70% crash, and urging everyone to do likewise.
But then, if you were not planning on buying before a crash, because a deposit is “not actually buying — why did you put down a deposit? Just for shits and giggles?
And if you did plan on buying, why were you advising everyone against buying?
Actually m, he’s exposing you for the fraud that you are.
This is getting better and better. Lol f-ing lol.
“Do you even work in ITâ€
What?!?! This guy. He has to keep put words in my mouth and add to the story so the that it fits his narrative. First he claimed I said I had a “perfect renterâ€.
I mean, the renter pays very month but I never said it’s perfect.
Now I work in “ITâ€. I never ever, ever said I work in IT.
This is tiresome. For some reason he can’t des with it that I inherited money and bought a house. People can change. I am a bull now enjoying my house in SoCal. Keep putting words in my mouth if it helps you.
It just exposing what a sad life you just have. Nothing better to do than make up shit.
Those numbers are BS. BLS’s numbers are completely contradictory to the numbers of DOL (in terms of continued unemployment claims). This is an election year folks. BS everywhere. Housing and the stock market are going to come down hard. This will happen no matter who wins.
This will take some time to play out. Sure 3% interest rate is the important part, not the house you’re buying, which overvalued by 50%.
I agree with with the 50% haircut. It can be possible. All we need is a zombie outbreak or an alien invasion. Maybe if the murder hornets finally come through and start killing half of the population, we get there as well.
Chances are the market goes up in price due to low inventory and low rates but there still is the possibility of aliens arriving. Any day now.
I hope the June jobs numbers are true. There’s definitely a lot of traffic out there in the Interstate.
Mortgage conman tells how he raised $50,000 homes to $200,000 through fake appraisals. The entire housing market is fraudulent. All of them are manipulating it upwards to no. They all need to go to prison. https://www.youtube.com/watch?v=mQzjvrsYsv8
My belief is that the termination of mortgage forbearance starting next year is what will initiate a drop in housing prices in CA, as not every lender will not make things easy for borrowers. Imagine increased inventory combined with stricter borrowing requirements. The ability to make mortgage payments has nearly everything to do with employment for most people. The June report says 11% unemployment. As I said earlier, I hope that’s true. But is it?
https://wolfstreet.com/2020/07/02/never-before-have-i-seen-so-much-fake-unemployment-jobs-data-by-the-bureau-of-labor-statistics-while-labor-department-nails-it/
Unemployment claims are still sky high, but the unemployment rate is dropping like a rock? As someone said up above, this is an election year… so I wonder. Any thoughts on what Wolf presents in this article?
Employment numbers are key but also keep in mind that financial hardships exist that are not reported. Many white collar executives are being hit with salary/bonus reductions. Hourly employees are seeing a reduction in hours.
CA Housing Collapse Starting with Rentals-
San Francisco Rent Drops Most On Record As People Flee For Suburbs
https://www.zerohedge.com/markets/strangest-downturn-bay-area-rents-collapse-people-flee-suburbs
Remember, Shit flows down stream, OC is next.
The San Francisco Bay and the Pacific Ocean are downstream from San Francisco. South on a Mercator projection is not downstream. Mt Davidson, 928 ft; Santiago Peak 5,689 ft. Orange County, especially the area below Santiago Peak is the suburbs personified.
What is going on!!??
I can’t believe how resilient the Southern California are market is….earthquakes, looting, civil unrest, demonstrations, smog, horrible traffic, pandemics, low wages, high unemployment, bad economics, crazy politics, rampant homelessness, and sooo much more.
But I see new construction homes sell in the 3.5m range BEFORE they are even listed. multiple offers still going on…listings getting offers all cash in days…
What the hell is going on? You can’t tell me a phony baloney stock market and low interest rates are the drivers behind this….good weather premium? Amazing consumer confidence? Can all the rich people be ignorant of these facts and still want to buy?
Oh wise ones pray tell what is going on…
It’s much easier and simpler than people think:
Historic low rates
Housing shortage. In SoCal We had 115k active listings in 2007
Over 40k last year and now below 30k!
Check your neighborhood, how many quality homes last on the market? Or are even for sad?
On the flip side you have people lookin for a home. Who wants to rent in a high density area forever?
So many people on this blog have been wrong and they have been mocking me for buying. Now their anger shows 🙂
Pent-up Demand.
Housing has always (yes, always) been a great long-term investment. If you hold for 10+ years and live in it, you have always come out ahead.
We’ll see how long the demand holds.
The people buying houses are not the ones unemployed who were making minimum wage.
The people buying houses are the people making a 100K+ salary while working from home in a cramped 2 bedroom apartment with the kids climbing the walls behind them during Zoom meetings. They need a bigger home with an office since they can’t “go to work” anymore to escape.
IMHO, that is where the pent-up demand is coming from. The 100K+ wage people have finally decided “Like M” that living in a small space while working, just doesn’t work.
Pent-up Demand.
Housing has always (yes, always) been a great long-term investment. If you hold for 10+ years and live in it, you have always come out ahead.
We’ll see how long the demand holds.
The people buying houses are not the ones unemployed who were making minimum wage.
The people buying houses are the people making a 100K+ salary while working from home in a cramped 2 bedroom apartment with the kids climbing the walls behind them during Zoom meetings. They need a bigger home with an office since they can’t “go to work” anymore to escape.
IMHO, that is where the pent-up demand is coming from. The 100K+ wage people have finally decided “Like M” that living in a small space while working, just doesn’t work.
If You Purchased in CA, You Are About to Get EQUITY RAPED- From KPBS in California. “The San Diego City Council voted narrowly Tuesday to extend a citywide moratorium on evictions through September 30. Unemployment in some low-income San Diego neighborhoods has been hovering around 25%. Councilmembers Barbara Bry, Mark Kersey, Chris Cate and Scott Sherman voted against the measure, citing concerns that landlords would be unable to pay mortgages or maintain their properties if they are forbidden from kicking out tenants who aren’t paying rent.â€
“‘I understand and sympathize with the challenges many of our residents are facing,’ Bry said. ‘But today we are being asked to vote to extend an eviction ordinance that doesn’t really solve the problem.’â€
Throw a couple more sandbags on that levee, it’ll work
All these government types did with the don’t pay your rent scam is to encourage landlords to be super picky now when it comes to who they rent to. Basically, if you have a government job and good credit you will be what landlords are looking for. They unwittingly screwed a whole class of renters from finding good places now. The cherry places will pick and choose the good ones. Everyone else has to move to junk.
San Diego, CA Housing Prices Crater 20% YOY As One Broker Shared, “Rent A House For Half The Monthly Cost. Buy It Later Because Prices Are Plunging.â€
https://www.zillow.com/san-diego-ca-92109/home-values/
As a leading economist advises, “Mortgage debt is the most toxic and damaging debt of all. Avoid it at all costs.â€
That link doesn’t show anything about a 20% drop YOY in San Diego. It shows a 6% gain YOY in Pacific Beach and Mission Beach.
We just had a tenant play us on the “don’t pay your rent scam” and when all was said and done they were off buying a house. Here’s the rub…the house is in what most in San Diego would call a bad area, not fringe, bad. He’s working for some sort of startup and she’s out of work. They just bought a $585k house in the ghetto that sold last December for 350k more or less. Some flipper did the basic shaker cabinet and greige click lock floor floor plus they pulled the bars off the windows and changed them. Don’t forget the greige earth tone paint and you’re 150k richer from a crappy flip. Last time I saw folks who couldn’t afford to buy a place do this was in 2005 when I saw a painter and a waitress buy a 600k house in the worst area and they lost it in 2008 or early 2009. Things are similar but different; folks buying in less than fringe neighborhoods thinking that the neighbor will also take down his iron bars is a recipe for disaster. There’s nothing left available so this is what people have to settle for and it won’t end well. For the next few years it ought to be interesting, though. Prices will continue to go up until out of no where they start dropping. When people realize how bad this economy became is when the house of cards starts falling. Lots of free money between now and the election is postponing this somewhat. I doubt it’ll be a free for all like after 2008, but it will have to correct.
“Prices drop out of nowhereâ€.
Yeah, keep waiting for prices to drop out of nowhere.
What you describe is called gentrification. I remember a neighborhood like that. The neighborhood is loud, older, smaller homes. No hoa and mostly blue collar jobs.
Houses sold in 2011/2012 for below 300k. Now they are in the 500’s.
What happened over time? People with higher income kept buying there because it was much cheaper than some of the nice neighborhoods. Higher income isn’t enough. You need a large downpayment to get into nicer neighborhoods. Over the last 20 years the graffiti disappeared in this blue collar job area I describe. Some old folks in the neighborhood still remember the time of gang activity. Nowadays, nobody talks or fears gangs in this neighborhood anymore.
Buying in this neighborhood and removing the bars would have been a smart move. Why? Location, location, location. Not far from the freeway, not too far from the beach.
Now, a target opened up near by and several Starbucks. Some front yards look really nice and you see less and less beater cars that leak oil on the street.
Those that could barely afford to live there sold probably and moved to a cheaper area further East. Some of those people lived there when house prices were in the 100’s.
To think that prices can just drop out of the blue without inventory skyrocketing is the def. of insanity to me.
If you have goods that people need or want but you don’t have enough of it, the price cannot go down. I am referring to housing.
Take a look at Europe. Density and huge multi family complexes. Way too many people. Rates in the 1-2%. And small houses that sell for a fortune. This is our future. A house with a yard will become something very rare. Walk through some of the condos and apartments they are building. For the renter, less living space will become more expensive over time. Owning and keeping real estate will be like a gold mine. I am not saying use it as an ATM, I am saying it will increase your networth without your doing (other than paying your mortgage). Rental income is a path to riches.
That’s why I want to work towards getting my first rental property. I do not like having a renter in my house…the extra cash is nice but I want the renter to live away from me and pay off another house. I realize now that having a stranger in my house isn’t what I want long term. You live and learn. I will keep the renter for a while longer to pay for stuff but at some point it will be an empty granny flat for guests or a “play†area.
“I am not saying use it as an ATM”
M,
Absolutely critical to mention this. Too many people in the run-up to the crash took out lines of credit as their house values went up. So they peed away their equity living the “good life” with the idea that the increased value would keep increasing forever. Wealth creation comes out of managing debt. Going from hedged to speculative to Ponzi financing, according to Minsky, leads to bubble bursts. If you stay in the hedged area, you’ll almost never go wrong. Your renter is your hedge.
Go look at the case – schiller index graph an older one will do. Put a ruler on it that follows the graph till 1995. That’s where housing prices are going – a return to the mean.
They will probably lower past the mean – it’s called adjustment.
I wonder what the bears – that claimed that Q1 2020 was the peak – will say to increasing home values?
https://www.dailybreeze.com/2020/07/05/bubble-watch-appraisers-dont-see-drops-in-socal-home-values-yet/
The peak must have moved :).
That’s the nice thing about perma bears. They can just adjust their crash target date. One thing is for sure, it’s always right around the corner.
I’m refinancing from 3.875 to 2.875% so with my payments going down $500 each month I don’t really care if housing prices go up or down in the near term. I’m better off this year than last year either way. I’m hoping that rates on renovation loans will go down too so I can build an addition onto my home. Then I will go from overpriced crap-shack to overpriced crap-bungalow. Still too small for my family, but it’s progress!
Good to hear that you’re making financial progress. But why would you ever have a house that’s too small for your family? Especially with everyone working from home now, that sounds really stressful.
M has bipolar disorder…..prove me wrong…alternative thesis…M is full of shit. I also acknowledge you can be a full of shit with bipolar disorder and I do not exclude this last thesis regarding M.
Lol.
Why is that? Do you have one single reason?
I used to be a bear waiting for a crash.
Now I understand that in SoCal with a housing shortage and historic low rates, a crash cannot happen. I provide data every week that shows how hot the market is.
Buying a dream home in Q1 2020 was one of the best things I have ever done.
The expected market time in SoCal is below 60 days…..way below 60 days. All of you perma bears said it will crash. You have been wrong and instead of providing any data that supports your narrative you do personal attacks. Weak!
M: Buying a dream home in Q1 2020 was one of the best things I have ever done.
Yet you later claimed you bought it while it was still being built, inspecting all the materials as they went in. Which mean you must have bought a house last year.
Then you claimed you only “put down a deposit” last year which isn’t “technically” buying. Even so, it’s part of the process of buying.
So then, why were you insisting last year that you would never buy a house before a crash, even as you were simultaneously buying a house before a crash?
This is not about “changing your mind.” It’s about contradictions in your story.
A contradiction means that one of your stories is false. Either you lied about your views last year. Or lied about your home purchase last year. Or you’re schizophrenic, believing two contradictory things simultaneously.
San Diego, CA Housing Prices Crater 20% YOY As One Broker Shared, “Rent A House For Half The Monthly Cost. Buy It Later Because Prices Are Plunging.â€
https://www.zillow.com/san-diego-ca-92109/home-values/
Maybe yah missed this, or you maybe choose to miss it.
Yep, putting a deposit down is part of the buying process. It was the first step.
I would encourage you to buy at some point as well.
Renting long term is financial suicide.
Why is he full of crap? Why does everyone on this blog try to knock him down for switching his position on real estate? He acknowledges the facts and updated his perspective which demonstrates his ability to think in a logical manner. He’s not regurgitating baseless claims and seeking confirmation from commenters who are completely disconnected from the market. I think all of this hate is an indicator of the surrender flag from perma bears on this blog that are too prideful to just admit that they were wrong, are wrong and will continue to be wrong for the foreseeable future. I guess it’s easier to just insult someone else rather than just accept the facts that you, like myself and M, could’ve greatly prospered if you just opened your eyes and ears when I have been preaching for years a detailed analysis of why the market is not slowing down. The only difference is you didn’t listen, he did. He’s reaping the benefits and you’re not. Don’t hate the players!
Why does everyone on this blog try to knock him down for switching his position on real estate?
Not about M changing his mind. It’s that his claims are contradictory.
* All through 2019, in every thread, dozens of time per thread, M insisted that he would never buy before a crash.
* Now M claims that, in 2019, he was in the process of buying a house, inspecting materials, putting down a deposit.
See the contradiction? Both statements can’t be true. Me either lied then about his plans and opinions — or is lying now about having bought house.
He’s been caught lying. So, what else has he lied about?
I think all of this hate is an indicator of the surrender flag from perma bears …
I was never a bear. Read my old posts. I often called myself a “reluctant bull.”
Laughable.
Yes I started changing towards the end of 2019.
How is that a contradiction?
“ All through 2019, in every thread, dozens of time per thread, M insisted that he would never buy before a crash.
* Now M claims that, in 2019, he was in the process of buying a house, inspecting materials, putting down a deposit.â€
I said dozens of time now I was wrong in the past. I changed my mind. That took a while but the more data I look at the more feel I confident about my purchase.
Look at yourself: you predicted looters will go to my neighborhood and I will be arrested for defending my home. Hasn’t happened yet.
You said I claim to work in IT. I never said that.
You claim I said I have a perfect renter. I never said that.
Now you say I inspected materials.
How much more BS are you coming up with?
I was a bear and changed. It happens. It was the right thingZ
Get a life. And start saving for a downpayment. Renting long term sucks.
Maybe because he was annoying as eff, the self proclaimed “real estate expert”, insulted everyone (realtards) and posted repeatedly the same zero hedge articles on every thread. Of course he’s full of it. Look in the dictionary under troll. Quit feeding him. None of his fairy tales make sense.
M: Yes I started changing towards the end of 2019.
Huh? You were still loudly proclaiming in early 2020 that you would never buy before an epic crash.
Later, you claimed you were already inspecting materials, and putting down a deposit, in 2019.
M: How is that a contradiction?
You understood what I said. You’re feigning ignorance. I’ll explain again.
You said, yet claim you did, two opposite things, simultaneously.
All through 2019, dozens of time per thread, you insisted you would never buy before an epic crash.
Now you claim that, in 2019, you were in the process of buying a house, inspecting materials, putting down a deposit.
You see? Saying one thing, while doing the opposite, at the same time.
You either lied about your opinions in 2019. Or you lied about buying a house in 2019. Both can’t be true.
Still no contradiction here. I changed my mind and bought a house. Best thing I’ve ever done.
You in the other hands continue to make things up.
I never said I had a perfect renter
I never said I worked in IT. I work for a tech company. But there are tons of functions within a tech company. There is IT, finance, marketing, operations, r&d, systems, accounting, customer service, sales.
I also never said I inspected materials.
You are trying so hard. It’s funny and entertaining. Nothing will change though. I will continue to brag about my nice house and how the market is strong. No crash in sight.
Your posts won’t change that. That just show how you spend your time with.
I wish I had all that time on my hand. I gotta figure out the front and back yard. I need to get quotes from pool guys etc. it’s been hot here in SoCal.
M on July 12: I also never said I inspected materials.
Well, yeah. You did.
M on June 27 (same thread): The house is in fantastic condition and the top line materials were used. We watched it being built which is a cool experience itself.
You said you knew “top line materials” were used, because you watched the house being built.
You mean you “watched” only casually, without “inspecting”? But then, how do you know they were “top line” materials?
TIP: If you’re gonna contradict yourself, don’t do it in the same thread. Too easy to catch.
Some people just try to hard. Maybe it shows jealousy and/or being butt hurt.
I like to share my story so other people can do better than me. Waiting too long to buy a house in a place like SoCal is not a good idea.
Buying was Actually a fun And interesting process. watching our new house being built is something special that only a few people get to experience.
While so many people called for a housing peak in Q1, the market keeps pushing higher. Per core logic, the market went up by 4.8% in May! The expected market time for SoCal is at 40days which indicates an extremely hot sellers market. Impressive!
Wolfstreet reports 31.7 million receiving unemployment benefits. Is that close to 20% of the work force?
It certainly seems to make the 11% unemployment rate in June look like election year manipulation. Who knows for sure. It has been very hard to know what is really true this year. Stay safe and keep your wits about you.
Unemployment during Covid is a temporary thing. There are 10’s of millions trying to get back to work at their minimum wage jobs to pay rent to keep from being evicted, and to buy food. Just like during the 1918 Pandemic, this will end in about a year or sooner if there is a vaccine. The demand for minimum wage workers is 100X higher than the demand for buying an over-priced crapshack. Jobs will recover. Crapshacks with a home office will be in high demand for the 20% who need to work from home and make 50X+ minimum wage.
With minimum wage, they have never been able to buy a house in S. CA. Despite Obama being President for 8 years and Trump being President for nearly 4 years. That is the problem.
According to the Good Dr above, there were 12K homes sold in a population of 13M??? Supply is low and pricing says demand is high for those making 100K+ and needing a home office.
Everything recovers eventually. The question is how long. New cases of COVID are higher than ever in the US. Naturally, businesses and consumers are going to be cautious until there’s a vaccine. Hopefully that’s not too far off.
My question is, how is it that the government is putting out employment numbers that very much contradict each other. It is an election year…
IS the market hopium off the rails?
People keep saying that jobs are bouncing back?
Much of this is simply retail stores, right? stores are opening again BUT are people going to go shopping again other than necessities? With a 50% loss in foot traffic how many of these retailers who have hired back again are going to survive more than a few more months?
I think the calamity in still brewing.
A new trend in RE going nation wide:
https://thehill.com/opinion/finance/505944-americans-leave-large-cities-for-suburban-areas-and-rural-towns
What will be the wealth effect on larger cities if wealth is flowing to the smaller ones ?!….
One reason I haven’t bought a house these past few years is because I can’t decide where to live. I’m not certain I want to stay in California.
I’ve considered Portland and Seattle, and actually flew up to Seattle a few times to attend open houses in 2013 and 2014. But now with CHAZ/CHOP et al, I’m glad I didn’t more there.
Now I’m considering Northern Idaho.
But, I just can’t decide. I don’t love Santa Monica, where I live, but it’s familiar. I’m comfortable here, albeit not thrilled.
But with all these “mostly peaceful” riots, police defunding, government deficits, droughts, future earthquakes, all of which will be compounded by a possible long-lasting economic depression … I see troubles looming.
I just can’t decide where to move, or I’d have bought a long time ago.
Better make a decision quick before you get pulled out of your car at an intersection and beaten to a pulp. Think the odds of that happening are going to go down over the next few months and years? LOL. Time to GTFO. Sanctuary cities will implode with all the deranged people getting carte blanche from the deranged politicians to attack and destroy.
If I was in a similar situation, I would rent for 6 months up there somewhere. Maybe stay a renter and spend 6 months in the PNW, winter in AZ or some place warm. Renters with money that arent tied to a location are as rare as hens teeth right now.
SOL, if you don’t like liberals and socialist democrats (think AOC, Maxine Waters, et. al.), if you don’t like people making race wars a lifetime career, don’t go to Portland or Seattle. You’ll hate every single day of your life. There is also the hellish traffic bumper to bumper.
I would say, stay away from WA and OR – even if the easter part of the sate is conservative, those liberals from Portland and Seattle push their insanity over the whole state. Yes, on the eastern part of these states, it is much better than on the coast but you still suffer to a certain extent from governors craziness. At least the sheriffs on the eastern part ignore the governor’s orders. They said publicly that they are not going to enforce any of the governor unconstitutional orders for two reasons: he swore to uphold the constitution and he doesn’t want to waste the county resources for stupidity and virtue signaling. CHAZ is not an isolated event; it is the beginning for much more insanity to be displayed. I know what I am talking about because I lived for 15 years in Seattle. It was bad back then, but heaven comparative to what it became today. A new generation of brainwashed students came to maturity which will destroy that city completely – think Baltimore, Detroit, etc. I know for a fact that it is a true exodus from Seattle and Portland to Eastern WA, OR, ID and Montana. Civilized people want to live among people with common sense and the policies of social democrats are not conducive to that. The governor from WA and OR are no different than Newsome. Bob (Seen it All Before), if he moves to Seattle or Portland will feel right at home. You, based on your comments, will hate these two cities.
In ID, for average size city, Coeur D’Alene is the best. For small town, Sandpoint is the the best. Depends what size city you like and every person is different. Winters are cold and have snow. There are 4 seasons. If you like skiing, boating, hiking and outdoors in general, you’ll like it there. If you don’t like cold and snow, don’t go there.
Like I’ve said multiple times before:
If the Republicans let the Wealth disparity gap grow too far like in 1928, there will be consequences.
Back then, the great Democratic Socialist FDR was elected for 4 terms.
Now, your neglect may cause what you fear most. The dreaded commies may be elected.
Republicans ignore history to their peril. We’ve seen it all before.
Like I’ve said multiple times before:
If the Republicans let the Wealth disparity gap grow too far like in 1928, there will be consequences.
Back then, the great Democratic Socialist FDR was elected for 4 terms.
Now, your neglect may cause what you fear most. The dreaded commies may be elected.
Republicans ignore history to their peril. We’ve seen it all before.
Like I’ve said multiple times before:
If the Republicans let the Wealth disparity gap grow too far like in 1928, there will be consequences.
Back then, the great Democratic Socialist FDR was elected for 4 terms.
Now, your neglect may cause what you fear most. The dreaded commies may be elected.
Republicans ignore history to their peril. We’ve seen it all before.
Flyover, I’m in my 50s, so a good health care infrastructure is a consideration. I don’t need it today, but we all need increasing maintenance as we enter our 60s, 70s, and 80s.
I hear Scottsdale, AZ is fairly conservative. But will it stay that way as demographics shift? And I do like snow and cold weather.
I’ve also thought of Colorado Springs, or Montana (a state I’m not too familiar with).
I’ve seen photos of patriotic militia groups in Coeur D’Alene and Provo come out to meet BLM and Antifa, and keep them in check. I like that.
California is the gift that keeps giving: https://ktla.com/news/california/as-many-as-8000-california-prisoners-to-be-released-early-in-effort-to-stop-coronavirus-spread/
As many as 8,000 California prisoners could be released ahead of schedule in an unprecedented attempt to stop the spread of COVID-19 inside state prisons, with more than half of the releases expected by the end of the month.
The announcement on Friday by top advisors to Gov. Gavin Newsom offered stark evidence of the dire health conditions at several California prisons.
Remember Son of a landlord when I said the looting will soon stop? You said the looting won’t stop and it will get worse (residential areas). So far no looter has come by in our neighborhood. Also, I don’t see riots/looters in the news anymore. What happened to to prognosis?
M: Also, I don’t see riots/looters in the news anymore.
I do. Antifa/BLM violence is still ongoing in Portland. Crime and violence is rising in other cities too. In NYC, shootings are up 205% — https://nypost.com/2020/07/04/shootings-soar-205-percent-after-nypd-disbands-anti-crime-unit/
What happened to to prognosis?
I was predicting a longterm trend, not a daily event. And I stand by it.
As the years progress, crime and social unrest, will worsen. Some years might see a lull, but the longterm trend is ever more crime and social unrest.
But what point are you trying to make? Unlike you, I never claimed to be an “expert” at anything. And unlike you, I was not caught lying or contradicting myself.
You dramatize everything, maybe for attention?
You said the riots/looters will soon come to residential areas as well, didn’t you? Where are they? I haven’t seen one. Don’t they come in groups? We should spot them by now?
Instead, nobody talks about riots/looters anymore. As I said, it was a temporary thing.
It’s easy to sensationalize things by just adding a few little extras. That all you do. You add and make up things.
For example: “riots/looters will soon come to our neighborhood
I work in IT
I said I inspected materials
I said I have a perfect renterâ€
I never said any of those things. So why make it up?
Why don’t you post something that would help people to make a decision to buy instead?
You could post about the expected market time. It’s at 40 days in SoCal. Isn’t that sensational enough during a pandemic? It’s a sizzling hot sellers market.
Or you could post about purchase application data. We show 7 weeks of straight double digit growth YoY. What a sensation!
We also have historic low inventory. Less than 30k active listings. Last year we had 40k and in 2008 we had 115k! Very sensational!
M: : You said the riots/looters will soon come to residential areas as well, didn’t you? Where are they?
You already asked that. I already answered that.
You are desperately deflecting from the fact that you were caught lying. You’ve been busted. You’re not who you say you are.
I get it, you are mad that I bought a nice new house. And now you try to make up stuff:
Like I work in IT
I said I inspected materials
I said I have a perfect renter
None of these things are true. Why make up stuff? Just be happy for me that I bought a house and enjoy it?
I just wanted to update everyone that while I’m no longer actively involved in RE and flipping homes, that doesn’t mean that it isn’t a good time to buy. I just don’t see any profit worth my time on the market anymore. Prices have risen more than even I can imagine! I did call it though. I’m just making more money with stocks from my home office than I could with RE. Anywho, inventory in my market has gone slightly up which kind of put the brakes on the prices for now but I don’t imagine prices coming down unless interest rates go up (no indication that will happen soon). The market is still starving for inventory and rates keep hitting new lows so if you’re expecting a magical crash to appear out of thin air, you should probably go back to sleep.
I will update my position on RE and put it on the record just because, it’s probably more useful than at least half the comments on this blog. RE will most likely stagnate for the next year or so. I don’t anticipate much price action in either direction. I don’t imagine this “wave of foreclosures when forbearance expires” will be any more than two drops in a bucket. It will simply just present buyers with more options. Interest rates will determine the direction prices move and no indication of them moving up so I’ll assume they stay low. If all else stay the same (low inventory low interest) then rising wages due to the upcoming inflation will be the third factor that will determine price movement. In other words, nominal values should stay the same while real values drop slowly aka inflation will erode the value of homes but not at a rapid pace, maybe ~5% a year for three or so years. This will complicate things for simple minded perma bear “analysts” who only see things on face value. Investors who analyze the market thru sound monetary and basic economic principles should see things clear as day and capitalize. May we all prosper.
I just ReFi’d also.
I tried a mortgage broker who here in LA is a top 5% in USA of closing loans and they rejected me, saying my company financials (Im one of the shareholders of the company but am a W2 employee) were too weak.
So I then decided to try the lender who holds my current mortgage of 4 years at 4.0%.
They Re-Fi’d me without any question about my companies finances.
I was at 4.0% and am now at 3.25% loan.
I shaved about 2% of my total 30 yr loan value and also shaved $300 a month off my mortgage.
I know rates will probably drop again but due to some other circumstances I didnt want to wait longer. Perhaps next year if rates from another 75 basis points, I can ReFi again. 🙂
With situations like this, its hard to see how renters can ever win – my mortgage payment on a 1800sqft home on 7,000 sqft of land in Baldwin Hills is the same as a bachelor pad in West LA.
100% correct. The deck is stacked against renters in places like socal. That’s why the vast majority buy given any opportunity. Since the last housing bubble, owning a home has gotten cheaper and renting has gotten much more expensive. Given the recent civil unrest..the prices of those clean, safe leafy suburbs got even more sticky. There is no reason to live in a marginal neighborhood where the safety of you and your family may be in question if you can afford one of the nicer areas of town.
Thanks for sharing. You hit the nail….
Congrats for having 3600 dollars savings each each for the remainder of your loan!!
While rents go up overtime a homeowners piti not only remains stable…..no, it goes lower when you refinance! It’s almost unfair how asset holders are being favored over renters. And on top of being able to reduce your house payment, the house increases in value over time (appreciation) due to a severe housing shortage.
Buying a house as primary residence is a no brainer!
100% correct Millie. It is completely unfair how homeowners are favored over renters. But instead of bellyaching and complaining, why not just acknowledge it and profit from it. Anybody here still thinks they can outsmart or outlast the Fed? Buying a primary residence you can comfortably afford is an absolute requirement in places like socal. I have been preaching this for years on this blog.
Here’s a question to the bears. If we have the evil black swan event that tanks housing, do these guys really think they are going to be the ones getting the deals. The deals will ALL go to the cash and connected crowd. The rich have gotten ultra wealthy over the past decade. To think there is no competition out there is laughable.
It took me a long time to get it.
I think what happens is that kids watch too much YouTube, read zerohedge or wolf street and believe the Army of doom and gloomers that make money selling you bad news. There is always a crash boy out there telling you the crash is just around the corner.
In reality it’s much easier. Buy when you can comfortably afford it and add a rental unit/house when you see an opportunity. All that waiting for a crash hasn’t made anyone wealthy yet. It’s just a waste of time and chances are high that during a housing shortage prices rather go up than down.
Take me for instance. Do you think I regretted one second that I bought? Not once. I don’t even think about a crash anymore because it doesn’t impact me. I am thinking of getting a pool. I am thinking of my office and new furniture. I am thinking of epoxy flooring in our garage and how fun that garage will be once it’s done.
the best advice I can give you is, you can’t go wrong with buying a house that you can afford in a place like SoCal. Prices over the long run can only go up.
There were people that said every year since 2012 there will be a crash. Do you think those people bought stocks in q1 2020? No, they didn’t. And now they are saying it’s a dead cat bounce.
See the point here? It’s impossible to perfectly time the market.
2020 is an extremely strong year for housing
https://www.cnbc.com/amp/2020/07/08/homebuyer-mortgage-demand-spikes-33percent-as-rates-set-another-record-low.html
Demand took a dip during Q1.and since then demand has been extremely strong.
Rates are historic low and inventory is scary low.
There is no better formula than that for higher prices.
Therefore, our bears calling a depression have disappeared.
M, it depends how you define the word “Depression”. There are multiple definitions, and by some of those definitions we are in a “Depression”. For more detailed explanations, read the article below:
https://www.zerohedge.com/economics/rickards-depression-great-american-exodus
I know that the word “Depression” is scary, and for that reason, most journalists no longer use it. They use instead the word “Recession”. There is nothing to be feared than fear itself.
Anyway, even in a Depression, some people get richer and most lose. You have to remember, that wealth does not disappear in a Depression – it just gets transferred from weaker hands to stronger hands.
Looks like you missed the Corelogic article (case-shriller) predicting a 6.6% decline in nationwide prices by May 2021.
https://www.corelogic.com/blog/2020/7/strong-demand-fueled-home-prices-increases-may-but-prices-expected-fall-over-the-year.aspx
I didnt miss it.
In fact, the articles states the following:
“ National home prices increased 4.8% year over year in May.
Home prices are forecast to decrease by 6.6% from May 2020 to May 2021.
Home Price decreases will hit all U.S. states.â€
So an increase of 4.8% and a forecast of 6.6% decrease is your big crash?
Do you expect me to laugh or cry for the bears?
M, we are in a great depression. Prices will fall as soon as loan forbearance ends and foreclosed homes begin to appear again. Interest rates are as low as they can get so prices can only go down from now on. 30% unemployment is not good for home sales. Demand for housing is very weak and will collapse completely once the summer buying season ends.
Rofl
Wanna make a bet?
“Demand is very weakâ€
Gary, do you know what purchase application data is?
Do you know that it is an indicator?
Do you know the trend?
Do you know that purchase application is up 33% year over year?
Do you understand this means demand is stronger this year than last year?
Have you googled unemployment percentage for 2020 yet?
Where do you see 30% unemployment?
Pls don’t post a zerohedge article…otherwise I will lose even not respect…
Purchase applications are an early step in the purchase process and therefore is a weak indicator of future sales. So much can go wrong up until closing. The current 33% YoY increase is the result of 4 months worth of pent up demand. I’m not sure its disclosed how many purchase applications are approved. They are, of course, just applications. I also suspect many of the approved applications will expire on the shelf due to low inventory, homes not appraising out, financial hardships and space monkeys.
Exactly butch! “Early stageâ€
Therefore, purchase applications are an indicator of how strong demand is.
Purchase applications = demand.
If purchase applications are trending down, it means demand is weakening. Purchasing application up YoY. Means demand is stronger than last year.
Purchase applications up by 33% means friggin insane demand. It means, buyers care less about Covid, the upcoming depression talk and doom and gloom.
It means buyers take advantage of historic low rates and it means they need a house to live in.
You are forgetting the 4 months worth of pent up demand. That is what’s driving the 33% YoY increase.
87 homes posted on Zillow for sale within the past 24 hours in the Sacramento CA, and if you purchased in 2020 you are FOOKED, enjoy the weather.
Another record high for the nasdaq.
Purchase application data (demand) is now 33% up YoY.
Mortgage rates are near historic record lows.
Inventory levels are scary low. Anything for sale in your neighborhood?
Yep, folks, the Great Depression is just around the corner.
Last time I saw DOW down hundreds of points and NASDAQ up was in 2008. The housing maket is totally fake seeing that it would be in shambles right now if people had been forced to pay their bills that last three months. The entire economy is on financial steroids. Soon it will start having underlying troubles that will require even more care to keep it from complete destruction. Prepare for more mania!
Record Defaults and Loan Application Declines set the stage for Housing Crash 2021, noted research firm quoted “the table is set, the main course is being served” rates won’t stop what’s coming.
Oh boy, if yah purchased in CA this year, you got ur seat on the titanic. Enjoy the weather:0
The Collapse Has Already Started, By Felicia- From DS News. “Thirty-two percent of Americans did not make a full, on-time housing payment is July, according to Apartment List. This is up slightly from 30% in June. During the first week of July, 19% of Americans had made no housing payment, while an additional 13% paid just a portion of their monthly bill. The report added that 43% of households earning between $25,000 and $75,000 did not pay their full housing payment in July. Additionally, homeowners between the ages of 45-60 were found to miss the most payments at 22%. An additional 7% made a partial payment.â€
“Black Knight’s latest report stated that with 4.1 million homeowners past due on their mortgage loans, the national delinquency rate is now 7.76%. Delinquencies jumped 20% and 1.3 percentage points higher in May, which Black Knight noted, ‘would have been the worst single month ever recorded if it weren’t for the 3.1 percentage point increase the month prior.’â€
And if you live in CA, nothing to worry about, enjoy the weather:)
Oh, The Embarrassment if YOU Purchased in CA- The Los Angeles Times in California. “Adam Lambert couldn’t quite turn a profit in Hollywood Hills. The ‘American Idol’ alum just sold the modern digs for $2.92 million, or $75,000 shy of what he paid six years ago.â€
From Patch Marin in California. “Having conducted the study since 2015, Kentfield-based Foundation Homes Property Management is well-positioned to characterize the market and to predict changes that may be on the horizon. The April 1/June 30 period is the first studied during state and Marin County regulations related to the COVID-19 pandemic. Although properties stayed on the market for shorter periods of time (generally 4-6 weeks), demand and rental closing volume are still well below last year.â€
“The average discount (actual price to listed price) as in the 5% to 10% range. Approximately half of Foundation’s properties are in the luxury segment.â€
Year over year sales down 8%.
https://www.redfin.com/blog/housing-recovery-pulls-back-slightly/?utm_source=Iterable&utm_medium=email&utm_campaign=1022750&inquirySource=365
Housing Supply Overview
A Research Tool Provided by the Greater San Diego Association of REALTORS
http://sdar.stats.10kresearch.com/docs/hso/x/report?src=page
Anyone considering the effects these ultra low mortgage rates are having on homeowners who bought in the last decade or so? Who is ever going to give up a 275% 30 year mortgage… or 2.5% 20 year fixed mortgage ? They are going to hold onto that free money with a death grip!
I told you guys about the realtor that sold a house in SD which was a record high for that zip code. Same realtor just “pretty much“ sold another house: It was listed beginning of this week and already has an accepted offer.
This market is sizzling hot. Quality homes sell like Boston cream pie doughnuts.
We continue to enjoy every minute of the new house. I also talked to my renter and gave notice-unofficially. I don’t like having a renter in my place long term. The granny flat is kind of a hedge if things go south. But my in-laws already joked to move into the granny flat….. That might actually happen at some point. Life is funny…..I used to live with them in the past……now I buy too much house and have a renter I don’t like and soon enough my in-laws will move in (next 5-10 years or so??!!) life’s short and things can change. Sometimes rather quickly.
I used to post bull crap about a crashing market….now I am talking to contractors, make friends with neighbors, research pools and think about having kids.
I have to admit….we all grow up at some point and start nesting. It’s exactly like some long-Time posters here said in the past.
I haven’t looked back yet. I don’t miss those days living in a cheap, tiny apartment 🙂
M: I told you guys about the realtor that sold a house in SD which was a record high for that zip code. Same realtor just “pretty much“ sold another house: It was listed beginning of this week and already has an accepted offer.
Sure, Milli, sure. You’re a proven liar, so all your tales are suspect.
M: I also talked to my renter and gave notice-unofficially. I don’t like having a renter in my place long term.
Yet you said you only moved, and found a renter, earlier this year. You repeated many times how great it was to have a renter to help with your monthly PITA, and what a great renter she was, so perfect, no pets, etc.
Now you want her out? You no longer need a renter to help with the monthly PITA? But you said …
You don’t even try to keep your stories consistent or plausible any more.
I don’t need the renter. Of course, the renter pays a nice portion of my piti but I don’t need it. I can comfortably afford my house with just one income. I just don’t like having a renter in my place.
Just because people change their mind doesn’t mean I am inconsistent. People change their mind or try things out.
Don’t worry, guys! 32% of people missing their payments is no big deal. New Age and M said inventory is tight and rates are low, so prices will go up forever! It’s different this time!
https://www.cnbc.com/2020/07/08/32-percent-of-us-households-missed-their-july-housing-payments.html
It’s not different this time.
In 2008 inventory was at 115k active listings in SoCal.
Today it’s below 30k.
If we would have lost loans, foreclosures and inventory like in 2008 we would see it play out in a similar fashion. The market behaves exactly like it should. Supply and demand and low rates dictate prices.
So 32% of people not making their housing payment won’t have an affect on prices? Lol
Don’t fool yourself. If the forbearance terms indicate a back payment at the end of the loan then what is the issue? If my lender says, hey don’t pay me for the 5 month, we add that to the end of the loan…..why wouldn’t I do this if I am financially under stress?
If you are financially sound, you probably don’t want to do this as forbearance might mean you can’t refinance your loan etc.
If you think a third of all homeowners stopped paying their mortgage and will foreclose on their loan you are dreaming.
I meant liar loans
@Josh: We’re basically going to be in a housing “rebound” this year according to M. Low May inventory and interest rates and that is all that matters. Decreasing sales and demand? Disappearance of foreign investors? Nope, impossible. I’m putting my bet with good old conservative Corelogic, not M, the forum narcissist. Corelogic would have to be nuts to com out with this…unless they were confident. As for M, no one really knows who the hell he is but he sure likes to do repeat himself. Had a parrot like that once.
Hurry everybody, CoreLogic said:
“ National home prices increased 4.8% year over year in May.
Home prices are forecast to decrease by 6.6% from May 2020 to May 2021.
Home Price decreases will hit all U.S. states.â€
Hurry, the market goes up 4.8% and might decrease by 6.6%.
Hurry! Sell everything!!! Huuuuge crash incoming!!!!
Looks like the industry folks’ idealism is starting to wear off. No, they’re not expecting a crash but for them to say Los Angeles will lose 6.3% over the next year is a definite change in tune.
https://www.ocregister.com/2020/07/09/southern-california-home-prices-to-drop-for-1st-time-in-8-years-forecast-says/
Keep in mind that this prediction is being made while mortgage forbearance is still in effect. Hopefully employment will recover before next year.
https://www.calculatedriskblog.com/2020/07/black-knight-number-of-homeowners-in_10.html?m=1
https://www.blackknightinc.com/blog/
Forbearances See largest drop.
“The overall decline in active forbearance plans is likely driven at least in part by the fact that more than half of all active forbearance plans at the start of June were set to expire at the end of the month.”
They have declined but some homes might have sold or moved into foreclosure.
This is THE indicator.
Expected market time for all of SoCal is 40 days!
Last year it was 82 days.
SoCal is in a freakin hot sellers market.
No crash until the data changes dramatically.
Sry, but that’s reality.
Lending guidelines are tightening…
“A banker is a fellow who lends you his umbrella when the sun is shining, but wants it back the minute it begins to rain.”–Mark Twain.
https://www.cnbc.com/2020/07/09/wells-fargo-mortgages-bank-tells-new-clients-they-need-1-million-to-qualify-for-jumbo-refi.html
“The lender said at the time that it would shun riskier loans and only refinance jumbo mortgages for customers with at least $250,000 in balances. That move angered some of the bank’s mortgage personnel, who had to turn down customers seeking to take advantage of falling mortgage rates.”
“It also boosted the amount of cash that buyers need to have on hand after they’ve purchased a home, called a “post-closing liquidity requirement,†from 12 months of expenses to 18 months, said the person.”
Demand for housing is at an 11 year high!!!
Remember when son of a landlord called the top in Q1? They don’t mention that anymore, because they can’t believe how strong the housing market is and how wrong they were 🙂
Remember when son of a landlord called the top in Q1?
No, I don’t remember ever calling a top. I did call a plateau, several times over the past few years, and several times admitted I was wrong.
See. You are a liar. You said I bought at the peak but now you are stating you said “plateauâ€. You never ever said plateau.
Nothing but crap comes from you.
Come on, A plateau is the top of a mesa. A peak is the top of a mountain.
Both are tops. A plateau lasts a bit longer.
Both may plummet eventually.
M, that is the angriest comment I’ve seen from you. Interesting. Your tone is typically a lot more playful.
You are right Team millennial.
SoL, tries so hard every day. I guess that means he is butt hurt or jealous.
Many bears are. They can’t believe how strong the housing market is.
I can understand why they get angry and have to make things up or put words in my mouth.
But, the market doesn’t care. Low inventory (below 30k active listings) and high demand (purchase applications up 33% YoY) is tough to swallow if you called a crash. Take me for an example, making the decision to buy my first home was one of the best things I have ever done.
Team Millennial: M, that is the angriest comment I’ve seen from you. Interesting.
That’s because M is squirming.
He’s butt hurt, because he’s been exposed as a liar. Now everything about him — from his alleged bio, to his alleged opinions on real estate — is open to doubt.
Does M mean anything he says? Where does the troll end, and the real person begin?
If you ask me, the house I bought in Q1 is pretty real to me. I enjoy every minute of it.
Question:
My plan is to wait for the offseason to get a pool. Does anyone have any tips/tricks or know good pool companies? I live in north county San Diego.
I got the business cards/phone numbers of those that put pools into my neighborhood. Also I will talk to the neighbors once they tried out their new pools.
That reminds me. I need to get solar too. I am planning to never sell this home. Any experience you guys can share regarding solar is much appreciated.
Thanks in advance!
M: Remember when son of a landlord called the top in Q1?
No, Milli, I did not “call the top in Q1.”
I did say you bought at the peak. But I said that after the fact, after the Covid shutdown, when we were already in Q2. I certainly can’t claim credit for predicting the shutdown.
Prior to this shutdown, I had been calling a plateau for many years. The earliest I could find was in this thread from 2014: http://www.doctorhousingbubble.com/young-home-buyers-young-living-at-home-household-formation-demand/
Per core logic, the market went up by 4.8% in May! Wow! Who would have thought!
Just Another Nailin the Coffin for the CA Real Estate Time Bomb- “Wells Fargo is now requiring new customers to bring at least $1 million in balances if they want to refinance a jumbo mortgage, up from a previous level of $250,000, according to people with knowledge of the policy. The bank also tightened lending standards in its mortgage business in the July 1 overhaul, which impacts everyone applying for a home loan, not just jumbo refinancings, according to one of the people. For primary and secondary home mortgages, the bank lowered by 5% the size of loans it would approve relative to a property’s value.â€
“It also boosted the amount of cash that buyers need to have on hand after they’ve purchased a home, called a ‘post-closing liquidity requirement,’ from 12 months of expenses to 18 months, said the person. And in other areas of the business, the bank is still taking precautions. A moratorium on home equity lines of credit, which are a popular way for homeowners to extract equity from their home, is still in place, said the people. The bank stopped taking HELOC applications in late April, CNBC reported at the time.â€
“And the bank has not resumed its third-party mortgage business, where it purchases jumbo loans underwritten by other banks and credit unions, the people said. Wells Fargo shut down that part of its correspondent lending business in April.â€
If You Purchased in CA, You Are Fooked
Good info. Crash indeed is on its way.
Awesome!!! If you are buying a zero-down million dollar house with only 10K in your bank account, something is very wrong.
You would think 250K in your bank account would qualify you, but if you buy a million dollar house with zero down, likely not if the sh*t hits the fan. No skin in the game and not enough money in the bank account.
Excellent! Nobody is able to become leveraged to the hilt so prices will become sane again.
The unemployed worker who used to make 25K per year on near-minimum wage, and now makes 40K on unemployment, were not buying any houses. (Even at the generous unemployment wage of 40K, they can buy a 120K house. Just looking at this, there is something seriously wrong here and we need Democratic Socialism to fix it). Maybe someday, they will be able to. Likely if housing is stable due to interest rates and wages increase.
Awesome!!! If you are buying a zero-down million dollar house with only 10K in your bank account, something is very wrong.
You would think 250K in your bank account would qualify you, but if you buy a million dollar house with zero down, likely not if the sh*t hits the fan. No skin in the game and not enough money in the bank account.
Excellent! Nobody is able to become leveraged to the hilt so prices will become sane again.
The unemployed worker who used to make 25K per year on near-minimum wage, and now makes 40K on unemployment, were not buying any houses. (Even at the generous unemployment wage of 40K, they can buy a 120K house. Just looking at this, there is something seriously wrong here and we need Democratic Socialism to fix it). Maybe someday, they will be able to. Likely if housing is stable due to interest rates and wages increase.
Exactly. As a homeowner I don’t mind tighter lending standards. I have no interest in pushing the market higher through risky loans. Slow and steady wins the race. The last thing we want is creating a housing bubble.
Whoa Realist 1M in order to borrow back your own money! It’s a seller’s market bc there’s no inventory but buyers increasingly won’t be able to buy. one property I liked kept going in and out of a pending sale- my realtor said the buyer hadn’t performed but was now trying to scrounge up the cash to buy the place cash. Without the Chinese cash buyers etc I have to imagine a 20% tickdown on many of these aspirationally priced coastal properties. Some of which are just barely squeaking above their 2005 purchase price FINALLY btw! I already see 20% markdowns. But also some exorbitant frothy spendy transactions. Business as usual in coastal so cal isn’t that?
SOL, MT and CO have democrat governors. I think that soon, AZ may turn blue, too. MT also has long cold winters. I’m also in my 50s and I agree with the maintenance part two decades from now. CDA and Spokane area have any specialist doctor you want and they are big medical hubs. That is why I chose CDA even if I like more Sandpoint.
SOL, MT and CO have democrat governors. I think that soon, AZ may turn blue, too. MT also has long cold winters. I’m also in my 50s and I agree with the maintenance part two decades from now. CDA and Spokane area have any specialist doctor you want and they are big medical hubs. That is why I chose CDA even if I like more Sandpoint.
Bob, the Democrats today are no longer the Democrats you grew up with. Those were pro union and working class. Today’s Democrats are a bunch of globalists, all for outsourcing and leaving workers unemployed. The represent only the banking oligarchs of central banks and a world wide slavery without borders. They care less that in the process the wealth from the 99% gets to the 1%.
I would argue that Trump is more like the old Democrats. He was actually a life long democrat and nothing changed – he is still not a fiscal conservative and he is not a social conservative, and he never was. That is why I never voted for him and I don’t like his personality. However, I have to admit that he is better than Hilary and Biden and Obama.
He is the lesser evil.
Today’s Democrats are Marxist fascist totalitarians. Today’s republicans are left of Carter or FDR.
Don’t let the labels fool you!
FO,
I pointed out earlier in this thread that James Roosevelt backed Nixon. Carter and Reagan. He was his Dad’s closest confidant and defended him to the end of his days. FDR helped his son in getting jobs in private industry, sort of like Joe Biden, except without the foreign entanglements, unless you count his post-prohibition liquor importation connection with Joe Kennedy. Later in life he did get messed up with Investors Overseas Service, which turned into a major scandal under Bernie Cornfeld and Robert Vesco. He resigned in time to avoid prosecution. The Democrats were seriously into “honest graft” even before George Washington Plunkitt (look him up, folks!).
“Marxist fascist totalitarian”. That’s like saying “right wing liberal” or” Left wing neocon”.
Get yourself educated before you spill your embittered failed life on a forum like this. People like you make others stupid. Shame on you.
No Joe, there is absolutely no difference between the two. There are both totalitarian dictatorships where you are not going to have any freedom. Everyday will be a nightmare with no way to escape. I lived through it, while you debate semantics and labels.
It makes zero difference in what type of totalitarianism you live. It looks like your brainwashing is complete. Try to read some good books and travel to N. Korea or Cuba to get some real life experience.
J t
If FO had said “Marxist OR fascist totalitarian”, would you have been OK with that? Probably not because you likely think a little bit Marxist is OK. Mussolini started out as a high ranking member of the Italian Socialist Party, but broke with them over Italian nationalism during WW I (not over Socialist economics). So Mussolini had a bit of both wings in his makeup. But his totalitarianism was the defining part of his character, just like Stalin and Mao.
Like I said above, if Trump says this famous Democratic Socialist quote:
“No business which depends for existence on paying less than living wages to its workers has any right to continue in this country.†– FDR.
Then Trump might have a chance of being re-elected in November.
Otherwise, the Republican greed has gone too far, and Biden will be elected.
The Republicans are destroying themselves with autocratic arrogance. History does repeat itself. FDR, the Democratic Socialist, was elected for 16 years.
The stock market (as represented by the S&P 500) and gold (as represented by GLD ETF) seem to be converging now:
https://bigcharts.marketwatch.com/advchart/frames/frames.asp?show=&insttype=Index&symb=%24SPX&x=42&y=18&time=100&startdate=2%2F19%2F2020&enddate=7%2F12%2F2020&freq=1&compidx=aaaaa%3A0&comptemptext=GLD&comp=GLD&ma=3&maval=50%2C25&uf=4&lf=1&lf2=0&lf3=0&type=64&style=320&size=4&timeFrameToggle=false&compareToToggle=false&indicatorsToggle=false&chartStyleToggle=false&state=15
This is a comparison of the S&P 500 with GLD, with a 9 day moving average with envelope, a 25 and a 50 day moving average added. The market since the start of May has been staying above the 25 and 50 day moving averages, and within the envelope of the 9 day moving average. GLD went from outperforming stocks to paralleling stocks. I don’t see an imminent crash in this chart, but it may be an overvalued market anyway. With this slow drift upward, it may be at about the level of the peak in February by Labor Day. Both GLD and stocks are probably benefiting from a slide in the value of the Dollar. Real Estate is also a hedge against currency devaluation. Just because a lot of people can’t afford the local housing market doesn’t mean that there aren’t people who want to get into real estate here with surplus cash.
Realtors crying because they lost their expected cut – Lori Loughlin and Mossimo Giannulli sell Bell-Air mansion for ‘considerably less’ than ‘they hoped for’… after putting it on the market for $28.65 million in January
https://www.dailymail.co.uk/tvshowbiz/article-8513515/Lori-Loughlin-Mossimo-Giannulli-sell-stunning-multi-million-dollar-Bel-Air-mansion.html
Kent, nobody on this blog gives a crap about 28M mansions and if they drop in value. As Millie said, anything under 1M in socal is on fire. That is the only thing you need to know. With 2.X% ultra cheap 30 year money and sky high rent, people are out buying. Add in the pandemic and civil unrest, owning a primary residence isn’t a bad idea if you can afford it.
https://www.abc10.com/article/news/local/california/sacramento-housing-market-competitive-despite-pandemic/103-41b57f2c-c19b-4c83-9c69-f391f8cc5eb2
Survey: Pandemic Hinders Plans for 43% of Renters Ready to Buy a Home
https://www.rentcafe.com/blog/apartmentliving/lifestyle/survey-homebuying/
Hot news!!!!
Mortgage applications to purchase a newly constructed home soared 54% in June!!!!!!!!
Holy Quacamole!!!!
That’s insane!!!!! I told you guys that in our new community houses sell like 10cents hot cakes. The new phases sell out immediately.
I had no idea all new communities are this hot!
Freakin insane. If you think there will be a housing crash anytime soon you need to start with housing 101 again. This market is sizzling hot!
https://www.mba.org/2020-press-releases/july/june-new-home-purchase-mortgage-applications-increased-541-percent
Sorry bears…..not this year…..man am
I happy I bought in Q1!!!!
Again, just pent up demand from the previous months.
From the second paragraph of the article:
“it is another piece of data indicating that homebuying activity that was delayed by the pandemic in March and April is just being realized later in the season.”
Exactly. During spring we experienced the shutdown. The hot spring housing market has been pushed back to now. Demand was artificially suppressed.
Demand in SoCal is peaking. It hasn’t been this high since 2012…..daang
You already bought the house and not looking to sell. Why does it matter to you? Are you trying to prove a point? Are you eager to validate how smart you were for buying? Or are you just trolling? Did you even read the article you are commenting on?
Let’s wait and see what happens when the free money sugar rush is over. Wait to see the recession work its way through, wait to see eviction moratorium end, wait to see paycheck protection end, wait to see state and local governments lay people off, wait until extended unemployment benefits end.
THEN if we have these rosy demand stats and low inventory next spring, I will pay attention. Until then, your posts are really just boring self-congratulating drivel. Everyone on here already knows where the market is at now -HINT: see the name of this website. We are more interested in where the market is headed next year, so we can make rational decisions about our money now.
“Everyone here knows where the market is at nowâ€
Good, because I barely see any posts that talk about expected market time, purchase application data and inventory levels now compared to last year or 2008.
In Q1 and the beginning of Q2 a ton of people celebrated the upcoming crash. Instead of a crash the market went up in price in May and June. And in SoCal we are in the midst of a sizzling hot sellers market. I find it fascinating. And it’s so much better to be on the other side now. As a homeowner I enjoy all the good news about this hot market.
There is a difference between celebrating the upcoming crash and expecting it to happen. I am in the second category. I do agree with you, current San Diego market is sellers market. However, I don’t expect it to last much longer.
Purchase application data is showing a 7 week straight double digit growtH year over year.
Wow, just friggin wow. No way in hell you see a crash this year. But, we are already in July…..just a few more month and we have 2021. Let’s see what happens next year.
The US housing market is the most outperforming sector in the World! Congratulations home buyers and home owners!
Demand is creatoring in SoCal, with half the closing, say goodbye equity :0
Kiss your deposit money goodbye – San Diego, CA Housing Prices Crater 20% YOY As One Broker Shared, “Rent A House For Half The Monthly Cost. Buy It Later Because Prices Are Plunging.â€
https://www.zillow.com/san-diego-ca-92109/home-values/
As a leading economist advises, “Mortgage debt is the most toxic and damaging debt of all. Avoid it at all costs.â€
If you bought in California you’re f*****
Thanks for the link. Realist.
It shows prices in this zipcode 92109 went up 6% YoY.
I am actually familiar with this area (PB and MB). Very nice areas that will continue to appreciate over time.
Realist Logic:
Claims SD housing prices “cratered” 20% YOY and posts link
*Clicks link* SD housing prices up 6.3% YOY
How can anyone believe your bulls*** 🤣🤣🤣🤣
🤣
The posts by this clown are too funny.
You already posted this and it’s just as false as the first time.
Look, I’ve been saying that *duh* the housing market reacts slowly and that whether or not any significant price drops occur will depend on employment when mortgage forbearance ends. This is a clip from Wolf Street aligns with my thinking perfectly.
‘CoreLogic expects to see “a rise in delinquencies in the next 12-18 months – especially as forbearance periods under the CARES Act come to a close,†the report said. To what extent the delinquencies deteriorate further depends largely on the labor market, and on unemployment, and that remains a horrible mess at the moment.’
https://wolfstreet.com/2020/07/14/it-starts-mortgage-delinquencies-suddenly-soar-at-record-pace/
We’ll see what COVID’s effect on housing is in roughly 1 – 2 years.
Kaneohe, Hawaii Housing Prices Crater 13% YOY As Beach And Vacation Property Demand Plummets
https://www.movoto.com/kaneohe-hi/market-trends/
A distinguished economist said, “Nothing accelerates the economy and creates jobs like falling prices to dramatically lower and more affordable levels. Nothing.â€
CA home debtors are feeling better, at least they are not Hawaii, yet!
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