Millennials cannot save the housing market because of $1.5 trillion in student debt: Greater L.A. metro area has lowest number of Millennial homeowners.
Millennials are not going to save the housing market. Home sales volume remains tepid and younger buyers are simply not out in mass buying homes. The housing market is being driven by Taco Tuesday baby boomers and low sales volume. We will highlight a few data points that show that Millennials are simply not moving the needle on housing, especially in expensive places like Los Angeles where the majority of households rent. You have many people living in World War II standard homes in places like Torrance where prices are disconnected from value but people are now convinced that this is standard practice. It is not. The market is heavily indebted and Millennials are carrying the brunt of the $1.5 trillion in student debt that is floating in our economy. This has delayed younger Americans from buying homes. Take a look at these figures.
Student debt and young homeownership
Let us first put something to rest. The rate of homeownership for younger Americans is near historic lows. It is low because Millennials are making less and also have more debt while home prices are priced high in many urban areas where the jobs are:
First major point is that there is now nearly $1.5 trillion in student debt floating in the economy which is a drag on younger buyers. Many of the good paying jobs in STEM related fields require a college degree. The Taco Tuesday baby boomers that once worked in a blue-collar job requiring no college degree and were able to buy a home with one income is now a grandpa and grandma story that simply does not apply in this hyper-competitive global gig economy. We see this in areas like Pasadena where younger home buyers are typically a two-income professional couple buying a million dollar home next to a person that probably makes a tiny fraction of the income of the modern home buyer but bought many years ago and pays 7 to 10 times less in property taxes. This is the Tesla and beater car phenomenon.
The chart above clearly shows that young home buyers are not out in mass buying homes. We’ve been in an epic bull run since 2009 but somehow, this did not translate to young home buyers buying up homes.
Then you have the massive amount of student debt that is largely sitting in the hands of younger home buyers. Keep in mind the only thing more inflated than home values is college tuition. Many older Americans went to college when you could pay a few dollars and get a great education. Now, you have schools like USC charging more in annual tuition than the typical US family makes in an entire year!
So these two things go hand and hand – debt and home buying. So it must come as a little surprise that the worst area for Millennial homeownership in the entire country is the Great Los Angeles metro area:
California has over 2 million Millennial adults living at home with their parents. These are not kids but full-grown adults. They are not buying because look at what $600,000 gets you in Torrance:
This place is listed at $599,900 with 3 bedrooms and 1 bath in 910 square feet. First of all, how in the world do you get 3 bedrooms in 910 square feet? The place looks like a modular home but priced at an extremely high price for what it is. And we are back to the quick flip house humping days of yore:
Someone bought this place in May 2019 for $444,000 and now is selling it for $599,900. Did this upgrade really make this place “worth†$155,900 more in six months?
You get the idea and we are back to this arbitrary pricing but Millennials are not going to save the market.Â
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279 Responses to “Millennials cannot save the housing market because of $1.5 trillion in student debt: Greater L.A. metro area has lowest number of Millennial homeowners.”
Meanwhile, U.S. New-Home Sales Rise to Cap Best Three Months Since 2007.
https://www.bloomberg.com/news/articles/2019-12-23/u-s-new-home-sales-rise-capping-best-three-months-since-2007
So…with it being the best since 2007, you’re telling me that 2020 will look like 2008?
I read that housing is so hot that the Spring buying season is starting now!
There is so much printing and liquidity for the Central Banks combined with super low interest rates….the money is going into assets like the stock market, real estate, etc.
I’m an Xennial(born early 1980s) and I’m not going to be buying a home in CA. Most of the homes in my neighborhood go for $800,000+. Many of these homes are glorified trailer park homes. My student loans cost me $270 a month and I’ve been paying them for 12 years and still owe $20,000. When I was in college I got sick my Junior year and had to drop out. My disability had to do with my military service and I’ve been compensated for it at 70% disabled. I still wouldn’t buy a home if they compensated me 100% disabled because who knows what politicians will do in the future to cut my disability payments. I’m the apart of the people who need student loan forgiveness in this country. We’re the ones who went to college, got disabled during that time and had to drop out and are now on the hook for tens of thousands of dollars. We might consider buying a home if our student loans were forgiven. We would by buying more things and that would help the economy a lot. Instead I get a gov’t pay check for my disability and give back 15% of it for student loans every month. You want to help America? Forgive student loans for those who are on any amount of disability or unable to make more than $35,000 a year over a decade.
From “Military Disability Made Easy”
“70% rating: This rating will have the majority of the following circumstances and symptoms:
The Ability to Care for Yourself: This individual cannot take care of himself most of the time. He is in the hospital or a care facility or is being taken care of by family members all of the time, and requires one-on-one supervision 50% of the time. This person cannot take care of his own personal hygiene.”
Medications: This individual requires psychiatric medication at all times.
Symptoms: Some or all of the following symptoms will be present.
– There is the regular possibility of hurting self or others (including suicidal tendencies)
– This individual often cannot communicate logically
– This individual is actively psychotic, but may have intermittent contact with reality
– Obssessive-compulsive behavior that causes repetitive physical actions that interfere completely with daily necessary activities
– Severe, constant anxiety
– Mood often changes radically, without warning.
– Almost constant severe depression or panic, with the inability to function at all in stressful situations
– This individual cannot control impulsive actions like anger, violence, etc.
– Often disoriented to time and place
The Ability to Work: This individual may not be able to work at all or may be severely under-employed (such as a former intelligence analyst now working part time as a custodian).
Social Relationships: This individual cannot participate in any relationships most of the time. In other words, they cannot interact or build a relationship with another person. Family members may care for them, but it is normally only a one-way relationship. They cannot seek, invite, or encourage any relationships the majority of the time.”
I don’t think they are going to be collecting much out of your hide any time soon. And without a miracle cure, you’re probably out of the market for the foreseeable future.
Joe R I didn’t specify what my 70% rating was for. I do have physical disabilities that I got during my military service. Why did you pull up only a mental disability rating and claim that’s my issue? You’re really trying to get a reaction aren’t you? Maybe the next time you shouldn’t take such a low blow and ask what people are disable with. Many of the people who have dropped out of college with disabilities have physical disabilities. I saw a youtube video recently where a woman had to drop out due to a white blood cell disease she got in college. Many people having that type of disability should be able to get student loan forgiveness after they had to drop out. It’s not like they can just work harder or get another job as you would have them do. Maybe you can go get disabled one day and have people treat you badly too. You deserve it.
I grew up watching my Dad take care of his war injured legs and feet every night and then go off to work in the morning. Our house was only 1200 sq ft (after an addition). I live in a 1960s tract house, the kind you disdainfully call a “Crap Shack”. I keep fixing all the deficiencies bit by bit, poorly built closet by closet, etc. Your problem isn’t war injuries. It’s your attitude.
JoeR spare me the you have a relative is a veteran so you understand veteran’s issues. You’re the typical conservative who never served but claims to be a big bad patriot. I’m sure you called a lot of people traitors back around 2003 if they didn’t support the Iraq war and now you quietly admit to yourself it was a stupid war. I served, unlike you. I understand because I’ve been there and done that, unlike you. Daddy sure didn’t teach you real patriotism because he would have seen to it that you enlisted instead of hiding behind his accomplishments as if they were your own.
Kent, it sounds like you have much bigger issues to focus on rather than worrying about what the local housing market is doing. Even if prices dropped 50-70%, you still wouldn’t qualify. Good luck finding the focus you need. Everyone has a different journey. Embrace your truth, and find strength in your struggle, so that you may overcome these challenges.
How would you know if I qualify or not to buy a home right now or after a crash? Do you have access to my personal information? No you don’t. So stop talking nonsense and showing everyone you’re talking out of your ass. I could drop a lot of cash on a home if it went down 70% easily, but I wouldn’t do it because I don’t want to buy a crap shack that needs all those repairs.
“Instead I get a gov’t pay check for my disability and give back 15% of it for student loans every month.”
You might want to consider yourself very fortunate. Never mind, keep up the entitlement whine.
“I could drop a lot of cash on a home if it went down 70% easily, but I wouldn’t do it..”
And they want their student loan forgiven. In an instant the true character is revealed..
Goudey You’re entitled to bankruptcy on business, cars, homes and personal loans. College students aren’t entitled to bankruptcy on student loans because in 2005 George W. Bush and Republicans took the student loan bankster’s lobbyist money and made law saying student loans couldn’t be forgiven unless one is 100% disabled or dead. How is it equitable that 18 year olds aren’t allowed to get relief through bankruptcy on a bad decision, but a 65 year old is? It’s not and that’s what millie is pointing out as the reason that millenials won’t be buying homes anytime soon because they can’t get out of their student debt. The Great Recession really hurt millenials chances of saving money and getting into higher paying jobs in the long run.
Kent, Obama had a Democratic majority House and Senate during his first two years in office. And they were not bound by Bush’s decision.
Even so, Obama and the Democratic Congress did not forgive student loans.
So tell me something I don’t know. Guess what? They will NEVER forgive student loan debt so keep dreaming. They finally figured out a way to get peoples social security, by lending an entire generation student loans that will go into default and can be taken out of social security.
Godey you would be the first in line to get entitlements if a natural disaster destroyed your neighborhood. This is why I laugh at people like you. You’re trying to out conservative everyone else. President Trump recently approved student loan forgiveness for disabled veterans. I guess you need to write him a letter to tell him how displeased you are with him being such a liberal.
You are a clown. Why don’t you tell us how back in ancient times you walked 10 miles backwards in the snow to get to college after working 20hrs a day to pay for it.
Just like every other conservative in a red state in the deep south USA who acts like the Gov’t is bad, you would be the first in line for a federal Gov’t handout after a hurricane or some other natural disaster destroyed your home. You’re what people call a “blow hard” because you’re screaming at the top of your lungs how people need to be self relent when you would be the first in line to get an entitlement after a natural disaster struck your neighborhood. So drop the fake conservative act because it doesn’t fly with people who aren’t young and ignorant. You act as if everyone who ever got help from the federal government needs to send you a personal thank you letter. Get over yourself because you would be in line for help from the federal government under the right circumstances. df
If you do get that entitlement one day maybe you should write a letter of thank you to the state of California for paying more in taxes to the Fed Gov’t than you do?
Is that you Virginia Foxx?
https://www.youtube.com/watch?v=LCt_jwUCb00
https://www.youtube.com/watch?v=wzLhi67xlwc
https://www.youtube.com/watch?v=e-DaNMTYQf0
goudey: They will NEVER forgive student loan debt so keep dreaming. They finally figured out a way to get peoples social security, by lending an entire generation student loans that will go into default and can be taken out of social security.
Your theory makes no sense. According to your theory, the govt pays the same amount to Millennials, but as student loans rather than as SS. So how is the govt saving money?
Furthermore, if the govt was strapped for cash, it would rather pay SS to Millennials than student loans, because the SS payments are due decades later.
Your cynicism and hatred of Boomers has blinded you to simple logic.
Wow Kent. You sure got a lot out of my post. Hope you feel better soon. Your problems appear to go beyond student loan forgiveness.
Son of Landlord you are the one who is blind. Nothing in my post even hints on anything being about ‘boomers’. You might be suffering from Millennial Derangement Syndrome. Actually I am born 1966, I am Gen X, but only one year away from being a Boomer myself.
@son of a landlord
December 26, 2019 at 9:49 am
“Obama had a Democratic majority House and Senate during his first two years in office. And they were not bound by Bush’s decision.”
Nope. Not for 2yr. Only for a few months due to Repub legal shenanigans contesting the elections for 1yr+. Constant delaying tactics and other BS by Repubs meant about all they could get done is push through the PPACA through and then the 2010 elections happened.
https://www.outsidethebeltway.com/did-the-democrats-ever-really-have-60-votes-in-the-senate-and-for-how-long/
On top of that its worth noting back then you had some very Conservative Democrats still in office (aka Blue Dog Democrats) like Lieberman who vowed to vote against anything like that back then (as well as stuff like Single Payer or Medicare for All).
Obama and Dems had plenty of policy failures and issues that can be blamed on them but this isn’t really one of them.
And the real cause of the current student loan crisis is Reagan and the Repubs back in the 1980s BTW, it used to be perfectly legal to declare bankruptcy on student loans until then:
https://www.salon.com/2014/07/05/ronald_reagan_stuck_it_to_millennials_a_college_debt_history_lesson_no_one_tells/
If 12 years after college you can’t swing $270/mo, you’re doing life wrong my friend. Sorry but that’s just a fact.
Mr Landlord – OK Boomer
https://www.youtube.com/watch?v=ceu9STZmlr4
Kent have you thought about moving away from California? I moved back to the U.K three years ago and moved to the equivalent of flyover country. It has worked for me. I have less stress because of cheaper mortgage payments and a quieter life.
Im not saying this in an antagonistic manner and I don’t know your circumstances and commitments but have a think about it.
kent,
You should get out of this shithole state and move to a better place.
I am in San Diego in a neighborhood with atleast a million dollar home. My streets are wide but all filled up with cars reason being: Each bedroom hosting 2 adults or more in homes around.
This has brought the quality of life down for everyone.
Before we can even begin to talk about forgiving student loans, we need to stop making them in the first place.
The only reason why tuition costs have skyrocketed is because colleges are getting an unlimited supply of money that is insured by the federal government… all of which we as taxpayers are on the hook for.
It makes no logical sense that an 18 year old kid can take out a 100K loan for college with no income, no documentation, no disclosures, and no logical plan to pay back the money other than a promissory note that says they are going to pay it back over 20-30 years.
People can still go to school without loans, but they need to have a harsh reality check and choose an affordable in-state college. USC is not an affordable in-state college. Neither is Harvard, Yale, Stanford, etc. These are famous colleges, and they come with famous price tags. Graduating from one doesn’t guarantee any higher level of success than graduating from your local in-state school, and we need break the train of thought that suggests otherwise. Average in-state tuition for someone living at home is around 11K – and when I first started working in 2002 I made more than that delivering pizza’s part time ($1500 a month average = $18000 a year).
There is some great information in this blog article about how you can go to school without taking out student loans:
https://www.daveramsey.com/blog/pay-for-college-without-student-loans
The Ramsey team also produced a podcast called Borrowed Future that covers the student loan mess in great detail:
https://open.spotify.com/show/551UHfzZPCKqZ1FUBhibJX?si=VHoivFpyRNu2Vv3aqpAXkg
It’s pretty incredible the hole we have dug ourselves into regarding the student loan issue, and the only way to climb out of it is to stop digging. Only after that can we start to discuss cleaning up the mess (ie. forgiveness).
When I saw your home for $599,000 in Torrance, I wanted it. So I did some research. Turns out the home is rignt on Del Amo Blvd. east of Crenshaw. That is a terrible location … a major highway near the high crime city of Carson. Don’t buy that one. In Torrance, you need to spend closer to 1M to get something in a nice west Torrancce location.
Hey JT,
Not sure if you are new here or not. RE experts have been talking for a while about the state of the California housing market. Most RE experts (me included) forecast a 50-70% crash. Soon. The advice would be to wait until you can buy at a huge discount. Don’t waste your money by buying now. Let us know if you have questions. Cheers
That’s true. And experts have been talking about global warming since the 1950’s and keep revising the end of the world every 10 years since then.
Experts predicted FL would be under water by 2020.
Milli, there you go again with the “housing crash hoax”. You should keep your 50%+ housing crash forecast to yourself because people will think you are nuts.
Milli: Most RE experts (me included) forecast a 50-70% crash. Soon.
You’ve been saying “soon” for several years now.
Jim Taylor at least had the guts to pick a specific date. All through 2013, he promised a HARD TANK SOON. I asked for a specific date. So he picked one: “Beware the Ides of March” he said of 2014.
After March, 2014, he said it would occur sometime in 2014. As the year crept by, he kept saying he still had six months left … four months … two months …
After 2014, he had the decency to stop with the HARD TANK predictions.
Some of the RE cheerleaders pretend to be new on blogs like this. RE experts (me included) have proven time after time that inflated housing bubbles crash by 50-60% roughly every ten years. We will see those discounts soon. They are on the conservative sprectrum (a given). Look at the price history of houses – that’s an easy way how you can tell if you don’t like charts/data and facts.
As an example, some houses sold in 2005 for 800’s. In 2009/2010 they sold for half and now they are climbing back to 800. In the next couple of years you can buy them again for half the price. Some are even 70% lower. The ones that are 70% lower are those that are bought by the bigger fools – at the top.
Millie’s first post calling the bubble bursting was January ’17. It’s now January 2020. Experts know the average cycle is three years from top to bottom and beginning to pull out of the trough. (e.g. 2008-11).
But don’t worry guys, it’s “soon”.
Almost correct joe. I did call the peak last year and since then it’s going downhill. I would say that was spot on.
Milli: I did call the peak last year …
That was only your latest prediction, after many false predictions in previous years.
Thanks for confirming I called the peak 🙂
I don’t know if any other predictions. Can you send me what you mean? Of course not.
You are just blowing smoke.
I have been referencing all your RE cheerleader lies on the other hand:
There is no inventory
The Chinese are coming
Millennials will go out and buy in droves
You Already forgot what you guys said yesterday, huh?
Milli: Thanks for confirming I called the peak
It’s part of your failed crash predictions. You’ve been saying we’ve peaked for years now, and that a crash is coming soon.
OTOH, I haven’t heard any RE “cheerleader” claims about Chinese money for several years now. So in addition to making failed predictions, you also “shoot down” claims that nobody’s made in a while (i.e., you shoot down red herrings).
Millennial says: “Almost correct joe. I did call the peak last year and since then it’s going downhill. I would say that was spot on.”
Meanwhile back in reality, a place Millennial doesn’t live, house prices were up YoY last year and will be up again this year.
Ignorance is bliss.
Milli: anyone can go back and look at your posts from 3 years ago. Why BS? Afraid to admit you’ve been wrong for three years straight? You posted under “Millennial_NotBuyingYourOverpricedCrapshack” at first. It’s all still there man. Classic you. Fantasizing about 50 percent discounts that will never come true. Tens of thousands in rent down the toilet. LOL sad! But I guess jumping walls to trespass in strangers’ pool grottos is a great leg workout lol
As a RE expert I have a proven track record.
Called the peak in 2018.
RE shills were saying there is no inventory and prices will skyrocket. The opposite happened and I called it.
RE shills were saying the Chinese millionaires are lining up to buy your crapshack. I called BS and you see now that was just another sales pitch/lie.
RE shills were saying “this is the year millennials will go out and buy in droves†I called BS.
The list goes on and on and on. RE cheerleaders don’t like me being here recording their lies and call
And I am calling a 50-70% market crash soon. If you buy at the peak you are screwing yourself financially and will never recover. Just look at the people who bought in 2005.
Regarding the pool in the neighborhood community. It’s funny how Joe Schmoe can’t get over it. Is there something wrong with utilizing a nice, well maintained pool next door and not paying HOA’s? It’s not like I don’t have connections. I have a friend who lives there who provides me with the key code (keyless entry). There is a wall between our communities but I never had to climb or jump it. I walk right through the front gate. Some people actually think I live there. Why do you keep bringing this up? You sound very jealous of my househacking skills.
“I am calling a 50-70% market crash soon.” Sure, just like you were in January 2017. It will always be “soon”. Just wait a bit longer guys. One more time over the horizon. Lol at how pathetically sad and delusional these predictions have become. Put a date on it, I bet you won’t, because you know you’ll be wrong. Most analysts (read: experts) have the guts to put dates on their predictions. You don’t, because you aren’t an expert. Just some wannabe.
And I don’t need to be envious of your “house hacking”, Millie. I have my own house. No hack needed. 🙂
Tottaly agree.
“First of all, how in the world do you get 3 bedrooms in 910 square feet?”
I helped build and lived in a house in a rural area that had 3 BR and was about 820 sq ft.
It was an L shaped cabin with a “country kitchen” (kitchen was open to a living room with a fireplace), two small bedrooms with about 100 sq ft each, a bath and laundry room combination and a larger bedroom in the wing.There was a separate garage/barn that was a simple pole building detached from the house. The lot was about 3/4 acre. Zillow current estimate is about $155000.
I own a 3 bedroom, 1 car garage on a 8700 sq ft lot. It has a 500 sq ft basement that is partially finished. I rent it out for $655 a month.
Housing Bubble 2.0 Already Popped- Here Are The 50 US Housing Markets Already Turning Ugly
Denver, CO Housing Prices Crater 19% YOY As US Housing Demand Plummets To 21 Year Low
https://www.zillow.com/denver-co-80218/home-values/
Nothing accelerates the economy and creates jobs like falling prices to dramatically lower and more affordable levels. Nothing. — Senior Housing Analyst And Economist
Bradenton Beach, FL Housing Prices Crater 14% YOY As Sarasota Area Housing Market Turns Toxic On Rampant Mortgage Fraud
https://www.movoto.com/bradenton-beach-fl/market-trends/
Cortez, FL Housing Prices Crater 12% YOY As Double Digit Price Declines Expand Across Florida’s Gulf Coast
https://www.movoto.com/cortez-fl/market-trends/
San Diego, CA Housing Prices Crater 14% YOY As One Broker Concedes, “We’ve Been Ripping Off The Public For Years”
https://www.zillow.com/san-diego-ca-92037/home-values/
San Mateo, CA Housing Prices Crater 15% YOY As One Bay Area Broker Concedes, “Every Closing Is A Crime Scene.â€
https://www.zillow.com/san-mateo-ca/home-values/
Calabasas, CA Housing Prices Crater 12% YOY As Record High Housing Inventory And Rampant Mortgage Fraud Accelerates Across Southern California
https://www.zillow.com/calabasas-ca/home-values/
Bradenton Beach, FL Housing Prices Crater 14% YOY As Sarasota Area Housing Market Turns Toxic On Rampant Mortgage Fraud
https://www.movoto.com/bradenton-beach-fl/market-trends/
Dallas, TX Housing Prices Crater 20% YOY As Housing Correction Emerges In Every Major US City
https://www.zillow.com/dallas-tx-75240/home-values/
https://www.zerohedge.com/markets/here-are-50-housing-market-already-turning-ugly
JamesJim – your San Diego link shows a YOY INCREASE of 3% with a predicted INCREASE of 2.6% in the upcoming year. However, you state a 14% drop in your text. It seems that you wish to spread misinformation in the hopes of affecting the market. If you’re going to keep posting total garbage, at least write something interesting. BTW, with 10% down, a 2.6% increase yields a 26% ROI – maybe a good time for you to buy!
Financialization of the single family home market:
https://www.nber.org/papers/w21804
and
https://www.citylab.com/life/2019/10/single-family-house-rental-recession-homeowner-management/599371/
The first link is academic research from UCLA Anderson (dense).
Prices are not going to go down much because housing is now a corporate asset class. This housing market doesn’t need human buyers, people in America are now mostly just placeholders for debt. So, the housing market will continue along just fine, heavily concentrated among big holding companies. And these folks will never run out of cash because they have captured the Federal Reserve. Notice that just this holiday season 500 billion in new Federal Reserve money is going out to the REITs and hedge funds.
Sorry kids, the lights got turned off on the American dream along time ago. There is no free market for housing or any other major equity class. It’s all manipulated from the top.
your exactly right….and within a generation, people will think nothing of it because it will be the norm. The general public wont be allowed to own, only rent.
OTOH, butlers are more educated.
Prices are not going to go down much because housing is now a corporate asset class. This housing market doesn’t need human buyers, people in America are now mostly just placeholders for debt. So, the housing market will continue along just fine, heavily concentrated among big holding companies. And these folks will never run out of cash because they have captured the Federal Reserve. Notice that just this holiday season 500 billion in new Federal Reserve money is going out to the REITs and hedge funds.
There is no free market for housing or any other major equity class. It’s all manipulated from the top. Sorry kids, the lights got turned off on the American dream along time ago.
500 billions is crumbs, since sept 17th of 2019 to the end of january 2020 the fed will have pumped 7 TRILLION dollars into the repo markets (but no liquidity issues everything is fine move it right along folks!) + QE4 at $60 billion in t bills a month.
last month goldman sachs lost 1.2 billion in a derivative bets that they covered with 1.7 billion in FDIC insured deposits, since theyre a deposit taking bank now they will keep making those prop bets using hypothecated funds because congress voted in 2014 to kill dodd-frank after Citi bank lobbied (thanks Obama!);
Then last year in 2019, congress, including the new 2018 freshmen voted to kick out the swaps push out rule in committee when they authorized the new CFTC bill (but only after they voted to screw millenials and others via IRA changes via the ‘SECURE ACT’ and after they reauthorized the ‘patriot act’ and after they gave the pentagon over 100 billion dollars more for FY2020 in the national ‘defense’ authorization act than for all other social ‘discretionary’ programs like food stamps and healthcare and veterans) etc etc.
(operation enduring freedom iraq/afpak/africa wars ongoing costs: $7 trillion dollars since 2001, most of which cannot be audited and by comparison 50 years of cold war including apollo moon shots and development of nuclear technology for war and global satellite technology from scratch cost about 7 trillion dollars).
7 plus trillion dollars pumped into the assets of the top 10% in just 120 days…hey I guess thats nothing compared to 29 trillion in 2008-11…right?
still think the ‘markets’ are ‘free’. I’d like to hear from the hardcore ‘end-of-history’ capitalists in the house, raise your hands.
Wow. That was a lot of misinformation.
Welcome to what the non-government entity federal reserve has done to our financial system. Welcome to what not being on the gold standard has done. Welcome to living in a country whose greased gears depend solely on continuous conflicts. Welcome to the rest of the country falling into the same bottomless pit. Hello Virginia 2A sanctuary counties and militia… Please kick their ass
California will eventually become a Virginia x20
Already Popped – Housing Joins The Everything Bubble
https://www.zerohedge.com/personal-finance/housing-joins-everything-bubble
Zero Hedge is the Chicken Little of all websites. These guys have been screaming “the sky is falling” since 2012.
New age,
What you say is untrue.
You have a choice between excellent data, research and information on zerohedge or to read the NAR propaganda and tell yourself everything is awesome.
Zerohedge has never claimed that the sky is falling. It just shows the we are in a bubble and as we know every bubble pops eventually. Whenever you mention the word recession the RE cheerleaders are quick to scream gloom and doomers.
That’s because most RE cheerleaders haven’t had an education. In college the first thing they teach you is about economic cycles. Nothing keeps going up forever. It’s Econ 101.
Anybody who took Zerohedge advice to heart for the past decade lost out BIG TIME. They have been screaming the sky is falling for god knows how long. RE and stocks have went straight up. That site should be renamed Zerosense or Zerodollars.
As we have said umpteen times. Buy when it makes financial sense to you and plan on owning for the long term. Tune out the noise and then enjoy!
The sky has been falling for a long time, since the late 90s, really. It’s just a large sky and you’re not able to see most of it. Also, the people who stand to profit are pretty inventive in their ways to get you to look at the ground instead of your part of the sky…
How do you know it’s a day ending in “y”? Easy. ZeroHedge is predicting a crash.
reading excellent research papers on zerohedge hasn’t prevented me from making money 🙂
RE cheerleaders don’t like any website that doesn’t show the NAR propaganda.
RE cheerleaders have no interest in facts or data. It’s all about: buy now. Keep the bubble going.
Saw this phenomena of prop 13, fixed income residents living alongside young high wager earners starting years ago. My Mother was one of those. She had a nice home in a highly desirable location with a view of city and ocean, yet her financial means prevented her from doing much to the house, she lived frugally. The problem is, it’s the Boomers that have the money, and those high income couples of younger ages, are fewer and fewer, meaning there are fewer and fewer buyers to keep those high home values propped up.It also means more high-density rentals will replace those old single family homes.
Boo hoo. You spent $200K on a degree in SJW Studies. Zero sympathy.
Mr. Hannity, maybe you can get them an $80,000 a year started job in Houston, TX like you claim you did for your friend who’s a beach bum in CA.
Im sorry mr landlord if I came across as a rant in my last comment.
Its just I think were failing younger people in the west. Mainly in cultural terms, not teaching them restraint and encouraging them to live for the moment. “Buy this car you cant afford and you will be happy….â€
Why aren’t we as a society encouraging what Charles Dickens said:
“Annual income twenty pounds, annual expenditure nineteen [pounds] nineteen [shillings] and six [pence], result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery.â€
I just don’t think we should blame someone thats young that doesn’t know any better. Im sure you have ready articles and studies showing that its taking longer for people to grow up.
Anyway sorry again. What I like about this website is there are people like you that are willing to debate. Even if you disagree with other peoples views.
Mr landlord my initial post didn’t send.
I was saying that I don’t think we should blame young people for picking poor degrees. They should be better advised by teachers,parents and society. An 18 year old doesn’t know enough about life and is being misinformed.
“SJW Studies” brings up articles on social justice warriors and Saint John’s wort. I assume you are talking about the former, as St John’s wort while controversial as to its benefits, might actually get one a PhD in pharmacology or some other worthwhile area of medicinal studies.
What most people don’t know who criticize Bachelor’s of Arts degrees is that these degrees still require a lot of math and sciences. I took one class above algebra 2 to get my degree. I took physical anthropology, geology with lab, marine biology, physical geography and other science classes to get my Arts degree. If I wanted a science degree all I had to do was take a few extra science classes.
If you look into STEM too you’ll find out that only about half the graduates end up in STEM careers. Out of those half I doubt that most of them stay in STEM jobs. The STEM and trade school stuff is nothing more than right wing propaganda. I wouldn’t want to live in a society that excluded the Arts. What a boring, colorless society that would be. It only takes a quick google search of STEM or trade school with the word sucks to find a lot of people who got into it and hate it. My dad owned a construction business and had two knee replacements, can’t lift his arms above his head, has torn biceps and multiple hernia. Tell me how construction is so wonderful and I’ll point you to my dad to show you your future. Unlike him, you’ll probably not have full coverage insurance since he retired from the Navy and you didn’t. Good luck with those medical bills.
A lot of people I have known with STEM degrees that move to jobs outside the field is that they go into sales. You probably already know that sales just pays a lot if you get into the right niche. Stockbroker is the occupation of the most millionaires according to a search I just did. Stockbrokers sell stocks. If you have a STEM technical background there are gobs of sales jobs that want you. SJW degrees can pay off if you use them to get into Law School and sue enough businesses for a lot of money. I suppose there are also cities with high paying management jobs that are run by people who want socialists running their departments. STEM jobs in the field are just fun and challenging. They do not make you rich unless you have an idea that allows you to start your own business (and essentially go into sales).
I was basically making fun of using acronyms like SJW for “Social Justice Warrior”. I thought it was funny that an SJW search also brought up “Saint John’s Wort”. That is an herb that is sometimes given for depression. And we are seeing a lot of money being made in medicinal herbs nowadays.
K:
I know a guy who used his PhD in Philosophy to get a job writing logical descriptions and manuals for computers. So it goes both ways. Also a lot of STEM grads who want big bucks go into sales where there is a high demand for technologically adept people. You missed the joke about the SJW acronym. I’m not anti liberal arts majors. I had a great expository writing Professor in college (English Dept.), who worked with me on how to put together a research paper. Most disciplines in liberal arts have nothing to do with politics in theory.
“Keep in mind the only thing more inflated than home values is college tuition.”
AMEN
I gotta disagree on that, without my degree I would never made as much as I do or have gotten as far in my career. Honestly as a young single mom decades ago my degree really assured my ability to support my family. I will agree that just getting a degree to have a degree is a waste. I carefully studied and chose a career path that I knew would be financially viable as well as being something I would enjoy. I also worked all the way through, attended a Cal State, and finished in four years with honors. So a degree is not a waste you just have to have a plan
Without my degree I would not have my career either. I didn’t mean to say that degrees are worthless or unimportant. Just that the prices are artificially inflated.
Merry Christmas everyone, including Millie and the rest of the perma bears.
It is incredible, and sad, how housing markets can be kept in a dysfunctional condition even when “first home buyers” have been effectively barred from the market by the price levels – they can be kept in a dysfunctional condition permanently by speculators. An analogy is the market for gold. There are practical uses for gold, such as “plating” and electrics and health remedies; but these things are all but priced right out of playing any effective role in “demand for gold”. Gold trading is almost entirely speculative. Housing markets can become the same.
So far, there is only one obvious policy approach that proofs housing markets against this fate, and that is “freedom to sprawl”.
The housing market, stock market, job market and college have all experienced hyperinflation. This is hyperinflation for the lower middle class and poor. The upper middle class and rich are invested in things that have gone up with the hyperinflation(stocks and real estate, etc…). Gold hasn’t been a good investment for the last 10 years. It’s still not a good investment unless you’re able to buy pounds of it and it goes up to $2000 an ounce. I did the math and it’s not worth it because you pay a dealer price when you buy it and sell it and you pay a hefty tax on any profit you make on it. To cut even you need to make about a 50% profit. Not worth the time in my opinion.
You buy/hold gold when fiat is worthless or unless you think can hedge inflation. All Fiats fail eventually.
Gold is on sale in USD. It is hitting ATH against most other major currencies. A strong dollar means lower price of gold. If the USD weakens, the price of gold will rise.
https://www.kitco.com/gold_currency/index.html?currency=no&timePeriod=5y&flag=gold&otherChart=hardCur
Over the past 5 years gold is up 35% vs Euro. 40% vs Canadian dollar, 47% vs British pound, and 26% vs USD, and 20% Swiss France, 29% Russian Ruble, 60% vs Mexican Paeso. Next stop for gold is 1700 if the USD weakens.
Over the last 10 years gold is up 182% vs Russian Ruble, 101% vs Mexican Peso, 76% Euro, 36% USD, 70% canadian dollar
Interesting study by Zillow regarding number of homes that will be on market in the near future due to retirement/death of baby boomers. No doubt houses will be snapped up in desirable areas. Question is at what price.
https://www.zillow.com/research/silver-tsunami-inventory-boomers-24933/
things arent going to change much until the baby boomers are gone, the next generation, millennials will repair, and the next generation will benefit. Millennials will spend their lives burning both ends of the candle. carrying the load now, and fixing it in the end.
When I first started visiting this blog, many people were ranting and raving that ‘there are 10,000 boomers retiring every day in USA’. those posts were circa 2010. And look what that did to home prices…. not the slightest dip.
Why: Boomers allowed their children to move in after the crash, boomers, allowed their grandkids also to move in. Boomers got wise and put rooms for rent on Craigslist before AiRBnB got popular. Boomers, also rent out rooms or their entire home on Air BnB. In other words, they dont sell their homes.
This new news about Boomers retiring is a nothing-burger, as far as home prices.
Nothing will drive down home prices UNTIL their is a job-loss recession and that will not happen in 2020, as Trump will do everything possible to float home prices, even if it means 2% mortgage rates. Damn the torpedoes, straight ahead.
There are more millenials than there are boomers. The demand will be there for those houses as boomers retire/die.
I love that title! Would love to find out the metro areas which currently have a silver diaspora and no youth diaspora and buy there.
If you’ve read and have followed the Harvard study on housing cycles realize we are just getting to the top of the market. It will bust in time but we are not there yet. We may get there sooner depending on outside events. However even when it does go it will really matter by area how strong the impact is.
Now with changes to prop 13 being voted on for commercial real estate I would not be terribly surprised to see movement towards residential which will have affect prices over time. In addition to this if Pelosi can’t get SALT tax handled that will also impact prices…I doubt Trump will feel like granting her that
So it’s eventually going to bust, but I thing this market still has some room to grow and the size of the downturn is questionable at best, but hey even if you do buy at the top you know the prices will return at some point in our paradise…at least a lot sooner in flyover country
Now with changes to prop 13 being voted on for commercial real estate I would not be terribly surprised to see movement towards residential which will have affect prices over time.
It will be at least a generation, maybe two, before Prop 13 is entirely abolished.
First they’ll remove Prop 13 for commercial property. Then, after 10 years or so, they’ll limit Prop 13 to primary residences. Then, after another 10 years, they’ll eliminate the inheritance of Prop 13. Then, after another 10 years, they’ll abolish Prop 13 entirely.
Milli is pushing 40. So Prop 13 might well be abolished when as Milli is hitting 70. Give it another few years for it to crash home prices, and Milli might well find his bargain house as he turns 75. Then he and his wife can finally start a family.
Yes, Milli, keep waiting. Good things come to those who wait. (Even if you won’t have that much time left to enjoy it.)
Normally I would fully agree with you on that but I am wondering if the change in our current demographics will speed it up. With more renters than owners at an accelerating pace I believe anything is possible anymore. They also want to make rented properties taxed as commercial too.
It seems crazy, but not much crazier to allow people to openly shoplift and defecate in stores without penalty….they want our money to subsidize more ineffective programs for the homeless as well as other things…
Son,
I’m not equating the two, so don’t anyone jump down my throat, I’m using it ax an example to illustrate how quickly things can change….gay marriage went from “not in my lifetime” to “how dare you oppose it H8ER” in about 15 years. And this was a fundamental societal change. If that can happen as fast as it did, changing property tax laws can happen as well. I can see P13 completely gone within 5 years. Remember Democrats can do whatever they want, there is no opposition in the state. And buying young and poor votes is a staple of the Democrat party.
Pushing 40? Rofl, that was funny. You do know the millennial birth years right?
How old are you? 50?
Yes, prob13 should be repealed and replaced. It’s a scam that needs to go. Why don’t we want boomers to pay their fair share? It makes no sense.
Mr. Landlord: Remember Democrats can do whatever they want, there is no opposition in the state. And buying young and poor votes is a staple of the Democrat party.
The young and poor provide the votes. But the rich and old provide the political contributions.
There’s a powerful political donor class that lives in Bel Air, Brentwood, Malibu, Silicon Valley, etc. They’re not keen on paying full taxes on their $10 – $100 million mansions.
And the politicians in Sacramento listen to the donor class. Especially if those politicians have statewide or national aspirations.
Not to mention that many politicians themselves own mansions.
Actually, let me correct the both of us.
When you said, And buying young and poor votes is a staple of the Democrat party., I should have added that the young and poor don’t vote all that much. A far larger percentage of older people (i.e., Boomers) vote than the young.
“First they’ll remove Prop 13 for commercial property. Then, after 10 years or so, they’ll limit Prop 13 to primary residences. Then, after another 10 years, they’ll eliminate the inheritance of Prop 13. Then, after another 10 years, they’ll abolish Prop 13 entirely.”
Prop 13 was voted in by a majority of primary homeowners after taxes became too high. The Republican Tea Party Jarvis/Gann slipped in the commercial and inheritance clauses. I believe Prop 13 would not have been voted in if these were alone in the bill.
I can see the commercial portion being removed first. Commercial should include housing used as a primary rental based on income tax return information.
The inheritance clause survival depends on how many heirs are using their parent’s house as a primary residence. If heirs are using the house as a rental, then Prop 13 should not apply to these commercial properties.
As when Prop 13 was voted in, voting it out will depend on the number of voters benefiting or suffering.
With increasing renters who want to be homeowners, the vote is tipping toward abolishment.
Millie, the first members of your generation were born in 1982. I know math is hard, but come on man….
Milli: Pushing 40? Rofl, that was funny. You do know the millennial birth years right?
You do know what “pushing 40” means, right? It means that you’re approaching 40.
The oldest Millennials were born in 1981, so they’d be 38.
You too are in your 30s, yes? So it’s accurate to say that you’re approaching 40.
How pathetic! Pushing 40?? By that def. I am also pushing 50.
Or how about I am pushing 60. Just ALMOST 30 more years and I am there
Look, I am sorry you guys are old and frustrated singles…but don’t try to me us older than we are 🙂
Milli: How pathetic! Pushing 40?? By that def. I am also pushing 50. …
Sorry if the term offends you Milli, but I didn’t make it up. That’s what the term means: https://idioms.thefreedictionary.com/be+pushing+40%2c+50%2c+etc.
Milli: don’t try to me us older than we are
Not sure what that means. But, objectively speaking, if you’re into your 30s, you are pushing 40.
Mr. Landlord, legalizing gay marriage is not comparable to ending Prop 13, because voters with a direct interest in an issue are far more energized than voters with an indirect interest.
Gays had a direct interest in gay marriage. Those opposed had only an indirect interest; religious principle, or whatnot. Thus, gays were more energized, organized, and likely to donate and vote to push for gay marriage, politically and in the courts.
Prop 13 is the reverse. In this case, it’s the status quo (i.e., current homeowners) who have a direct interest. Those opposed to Prop 13 have only an indirect interest — the hope that they’ll find a hypothetical house they like, in a neighborhood they like, at a reduced price. Or just plain envy at current homeowners.
Thus, supporters of Prop 13 have the same organizational advantage that gays had on their issue.
I am pushing 50, 60 and 40
“be pushing (an age)
To be approaching a particular age.â€
You are always approaching a particular age. We all are pushing 90.
It’s pathetic. You are trying to say that millennials should buy homes because of a certain age. I am saying, you buy when there is a buying opportunity no matter what they think your generation should be doing at a certain age.
At your age, they expect you to have a family, 2 kids a dog and most importantly a wife. Yet you are single.
This has nothing to do with offending someone. It’s just ridiculous.
I’m sure the Harvard study is accurate.
LOL
https://www.extension.harvard.edu/inside-extension/how-use-real-estate-trends-predict-next-housing-bubble
It has been accurate since the 1800’s but you know it’s not like Harvard is respected world wide or anything. Anyway we haven’t reached hyper supply yet So until that happens this baby still has some room to grow. I really see it not happening until a few years….but outer influences could shift it, like I stated before watch what happens with the SALT tax, prop 13, or how much building starts happening if Trump gets re-elected But I don’t see it for at least a year to two
I live in Torrance and I doubt there is any SFR for that price of $600k unlees it is “Bring Your Own Buldozer” condition. I bought my crap shack in 90505 for $515K in the very bottom of the market in april 2011 and that time it was one of the cheapest houses 3/1 1400 sf , but with added family room , origianaly was around 900 sf. Although I believe there is cities much worse deals than Torrance. After all we have exelent scholls and beach climate with suburban neet environment and position close to everithing in the metro area. Look at radiculous places like Marina del Rey or Agura Hills which are even more expensive and full of shortcomings.
Better parts of Torrance and South Redondo are the best deals in the South Bay. Most likely, those will appreciate strongly.
Personally, if I was a renter in the LA/OC area, I would just give up and move to another city. In many cities, you can still get a nice house for less than half of LA/OC prices …
Jt, I could understand this statement coming from someone who doesn’t like excel spreadsheets. For those of us who like to crunch numbers it’s a simple exercise to show how cheap renting is versus buying.
Renting when buying is too expensive is a great way of saving lots of cash. Then you just wait for the recession and buy 50-70% below today’s prices. Simple. And very rewarding. You should try it someday.
Housing Bubble 2.0 Already Popped-Despite Falling Rates, 70% Of US Homes “Unaffordable” To Average American
https://www.zerohedge.com/markets/falling-mortgage-rates-drive-9-jump-home-prices-70-us-unaffordable-average-worker
That is such a dumb statistic. I could explain it to you using a lot of math and statistics. But the short version is the “average” American isn’t buying houses.
We all want/need prices in California to crash. That can easily be done by increasing taxes for those who own houses and haven’t paid their fair share:
Boomers are enjoying freebies – they currently don’t pay their fair share in property taxes thanks to the biggest scam in history: prop13
Repeal and replace prop13. Boomers had freebies for way too long.
For those people that own multiple houses, like foreign and domestic investors: we need a vacancy tax. They tell you we have no inventory and therefore prices are high. Tax the shit out of empty houses and this story will change rather quickly.
It’s easy to crash prices. All you need is hefty tax increases for those greeedy boomers and investors.
Yes, Prop 13 need some to be repealed.
However, I think the next recession will solve many issues. In many parts of the Bay Area prices are double rental parity. Everything screams bubble. It will crash when people lose their jobs and can’t afford a 1.5 million mortgage and 20k+ in property tax.
The Fed can’t inflate this bubble forever, eventually the common person feels massive inflation or their is a massive reset. Either way cash is king. We increased our network from 100k to 1.2million and are sitting in cash. How long can the fed keep this house of cards going with Repo market breaking QE 4 starting and interest rates already under 2.. We have tons of zombie companies, massive piles of corporate, student and federal debt, and massive valuations of stocks, housing, companies. What could go wrong? They will exhaust all their tools and the next crash will be legendary, nothing destroys the economy faster than no liquidity and this crash will be global. No global liquidity. The next 5-10 years will be fun!
Just out of curiosity, what makes you think the Fed will ever stop providing liquidity (free money) at the top? They can print money endlessly. 450 billion in the last 90 days and no end in sight.
Milli: We all want/need prices in California to crash. That can easily be done …
That can easily be done if you had power. But you don’t have power.
And those who do have power — the Fed, the banks, Wall Street, property owners, and politicians — don’t want a crash.
So, no soup for you, Milli!
Son of a landlord
It’s much much easier.
All you need to do is run some ads on tv and show that boomers haven’t paid their fair share in property taxes for decades. Then show an ad on how investors sit on vacant properties while young families can’t buy a first time home. The public would jump quickly on a vacancy tax. But these tax laws would have to be dramatic. They would need to bankrupt an individual if that criminal gets caught. All our problems in California are due to the biggest scam in history – prop13. End prop13 and most of our problems go away.
It only took one voting cycle in 1978 to get Prop 13 on the ballot. Taxes were going up exponentially rapidly increasing assessment values and a 3% property tax.
The measure passed and property taxes dropped about 70% immediately due to the new 1% property tax and roll-back to 1976 assessed values. ie if you had a 100K house in 1978, the 1976 value was assessed at 70K. In 1978 you paid 3% of 100K = 3K in taxes. In 1979 you paid 1% of 70K=$700.
It was Our Millennial’s dream time! 70% drop!!!
If the pain of new homeowner’s and renter’s is great enough, there will be a new Prop 13. It will happen in less than 2 years.
We’ve seen it before and will see it again.
The outrage was apparent. Almost as much as Our Millennials outrage.
I agree with Millie on this point. There should be a vacancy tax on properties that sit empty for more than 6 months a year. It would be hard to enforce though. How would the city or county know how long someone lives in a house, it’s not like there will be someone there watching every day. It would be the honor system. And come on, you think the Chinese money launderer buying up 10 houses is going to tell the truth? LOL.
Millie, all these ideas you have like vacancy taxes, repealing P13, etc are band aid solutions. Your real problem is a fundamental negative outlook in a positive economic world. Change your outlook and your life will improve.
“Chinese money laundererâ€
Huh? The Chinese are having a real hard time moving money over here. Those stories are long gone. You haven’t paid attention.
If an individual has two properties and doesn’t show rental Income for one of the properties he/she/it should get fined with 250k in the first year.
Increasing taxes for those that have received freebies are very easy. If a boomer lady close to dying lives in a million dollar crapshack, she would need to pay 12k in property taxes. Just like me f I would buy now. If she’s late on her payment, there should be a 59% interest on the late payment. If I were a politician I would crash this market over night. Then I would buy up properties and change the tax laws in my favor. Just what the boomers taught us to do. It’s time we turn this game and tax the shit out of them.
I absolutely love this time. Investments look good, cash keeps growing. And the market is about to crash. We – millennials – will experience the boom years and an epic crash. Right after, we will buy beautiful homes for a bargain. I am thankful for this experience.
Happy New Years everyone! And may we see an epic crash in 2020, if not, we will save more and hope for a 2021 crash 🙂
Millennial. Can you show us a house you’d like to buy and the price your prepared to pay for it? Curious 😉
“A house†?????
You kiddin right?
I can show you 270 houses in my area that are in good school districts, quality lots, great neighborhoods and with the right floor plan. All you need to do is cut the price in half and I buy.
Where are you from? Give me your zip. I find you ten quality properties and tell you what you want to pay for them. That’s my job as a RE expert.
So you need a 50 percent fall before you would buy? I don’t believe that will happen unless we have a great depression with all the dangerous side effects of a great depression. Do you think we would have a normal recession with a 50 percent fall?
This is just the normal boom and bust cycle. 50% drops are very normal and conservative during the recession. Happens every time.
Can I ask one last question?
If you had bought the most expensive house available to you when you first qualified for a mortgage ,how much would you have paid if off and how much would it have gone up in value? Not trying to be rude but there will be a date where the house you hypotheticaly bought could fall 50 percent and you still come out on top because of the mortgage payments and it’s increase in value.
Your logic is flawed.
If you qualified for a house in 2005 and would have bought you would still be in the red.
RE shills like you always try to deny that there are economic cycles determining the values of houses. No matter how you spin it, it always comes down to: housing is about timing. Always has been. Sure, you can buy now and maybe in 2040 you are back to where prices were in 2018/2019 (peak). But is that your goal? If you want to come out ahead you save in good times and invest in bad times when asset values are down.
Milli , first of all Happy New Year! Second I undestand your pain if you were cought in this bubble. I have been into this for years and year before I buy the crapshak in Torrance, including fighting RE shills on this blog. Thirth I supoort abolishing prop 13 even if it is in my personal interest, it is just not fair . BUT there will be no crash of 50% . I paid attention that you say “owner who bought in 2005 will still be underwater”. This is very untrue. Getting for example prices in Torrance . Cheapest SFR in 2005 in zip code 90505 was 520k in 2008 was the peak at 700k, then in 2009-2011 they got back to 520k, today nothing you can buy for less than 900k ( forget the example in the aricle it is in the worse area of the worse zip in Torrance , my numbers are where you want to live.. ) . What I’m saiyng is prices give up only the last 2-3 years at least in desirable places ( not talking Riverside and Las Vegas where was the 50% drop) Here is the problem I dont want to sound like RE shills for me the proven truth “it is alway good time to buy” the reason is in desarable areas prices will give up only last 2 years of apreciation ( 100k) , but you will pay 80k in rent if you wait 2 -3 years , got forbig waiting longer like me , for example… I was totally screwed. In the grand scheme of things 2-3 years is nothing, the emotional value of owning your own place is bigger than drop of 100k . All this prediction of drop is probalistic that may not happen at all next time . I would bet on 10% chance for 50+% drop and 90% for 10% drop… this is for no human to know this. Again , it is not worthed waiting beacuse the price drop may not materialize at all. I dont know where you get the 50% drop but in desirable areas prices have not come down 50% even in the Great Resesion! This resesion will be more of a garden variety type. We have seen already the biggest economic crises of our life time and in good places prices were down only 30% , this time we may not see 10% … just my 2 cents . I have been on your side and I am still in some way , but economic reallity of today America is brutal and the whole game rigged against renters…
Millennial my logic may be flawed but I’m only human lol.
Bubble head I agree with your thinking. It’s not fair but it is the reality.
The oldest millenials will turn 38 in 2020. And they still act like they’re 24.
SAD
Exactly! We finally agree Mr slumlord from Spokane-ist an! The oldest millennials still won’t buy overpriced crapshacks! That’s sad, sad for those boomers trying to sell (laugh out loud :D)
Very smart my fellow millennials! Wait and pray for the crash!
Millennial,
Many of the oldest Millennials already have a few kids and own homes.
Here is the home ownership rate of Millennials vs. Gen X vs Boomers at Age 25-34:
Millennials: 37%
Gen X: 45.4%
Boomers: 45%
https://www.urban.org/urban-wire/state-millennial-homeownership
You millenials are getting OLD
Old is when you are in your 50’s and 60’s. When you are in your 30’s, you are young 🙂
Milli: Old is when you are in your 50’s and 60’s. When you are in your 30’s, you are young
Not according to people in their 20s.
Son of a landlord, Correct, if you ask a young adult in his/her 20’s about being 50 or 60 years old, he/she would tell you that’s basically like counting the days to having your last breath.
The Great Recession was the best time to buy… 2008 forward. Double cheap because mortgage rates went down while prices were low. Fast forward to minimum wage going from $8 to $15 per hour… now rents are zooming up up up… $$$ hind sight is always 20/20… wish I had bought more crap shacks with land instead of condos…
“Fast forward to minimum wage going from $8 to $15 per hour… now rents are zooming up up up…”
Socialists advocating fo higher minimum wage never get this part of the equation. Increase wages, prices go up, for everything including housing. That’s because instead of studying economics, they study White Male Hatred Studies in college.
And you’re absolutely right, 2009-2011 was a once in a lifetime opportunity for real estate. We will have ups and downs of course, but a perfect storm of cheap houses, 3% 30 year rates and skyrocketing rents….never gonna happen again. I wish I ‘d taken every dime I had and loaded up on real estate 10 years ago. I bought some properties, over the years while still relatively cheap. But I should have bought a lot more. Oh well….live and learn.
Exactly! But when you are in high school or college you typically don’t buy crapshacks 🙂
That’s why we need a greater recession. Millennials deserve a nice buying opportunity :)let’s crash this market!
I’m in my early 30’s, bought in 2015. 1.5 mil in investments.
Millie is right about the RE shills. The have news release saying that Generation Z is now going to save the housing market instead of millenials. How funny because how’s the children of the most bankrupt generation going to be the savior of the housing market? You can’t make this stuff up, but they sure have fun trying.
https://www.marketwatch.com/story/watch-out-millennials-generation-z-is-poised-to-dominate-homeownership-2019-12-19
That’s why I love this blog so much.
The pathetic attempts to find hope in keeping this bubble alive are just hilarious.
A couple years ago RE shills told themselves that the Chinese cash buyers will save the market
Last year it was the millennials “will go out and buy in drovesâ€
This year it will be “gen zâ€
What will it be next year? Aliens from outer space wanting to settle on our planet?
Milli: Last year it was the millennials “will go out and buy in drovesâ€
This year it will be “gen zâ€
Milli, stop posting the lie that anyone ever said that Gen Z was going to “buy in droves” this year. NO ONE ever said that Gen Z is “going to buy in droves†THIS YEAR.
HERE is one prediction that I’ve read: https://www.marketwatch.com/story/watch-out-millennials-generation-z-is-poised-to-dominate-homeownership-2019-12-19
When Gen Z reaches this same age in 15 years, 45% of the economists polled believe that more than 60% of them will be homeowners. Another 20% believe the home-ownership rate will be the same across the two groups, while 35% believe it will be lower for Gen Z.
In 15 years. Not THIS year.
If you, Milli, know of anyone who predicted that Gen Z will “buy in droves†THIS YEAR, please post a link.
Assuming that children of financially-strapped parents will be equally bad off is shortsighted. Don’t forget, the “silent generation”, who grew up during the Depression and had literally almost nothing to their names also spawned the Boomers, who did very well as a generation and arguable built the modern economy. Your success isn’t defined by your parents. This isn’t feudal europe.
The new year is here. That’s good news for the RE shills because millennials will resolve their debt issues and buy houses in droves.
The article shows the avg debt for millennials.
https://www.cnbc.com/2019/09/18/student-loans-are-not-the-no-1-source-of-millennial-debt.html?__source=facebook%7Cmain
The great news is that each millennial in the US will get a one time 300k bonus paid in January.
Millennials will be debt free and will have their downpayment ready by February. Just in time for the red hot spring selling season.
Housing market will skyrocket in 2020!! Epic spring season ahead!
By my count, 2020 will be the 7th year in a row when the housing crash was going to epic. Any day now kids…..
Happy New Year.
6 minute audio on the housing market in 2020:
– low mortgage rates did help in 2019, monthly supply is down, new home sales up, no crash expected for Y2020. No exotic debt structures.
First time Age 26-32 (replacement buyers to boomers) are coming online in 2020, creating a new surge of buyers. but it wont be a hot booming cycle.
https://www.bloomberg.com/news/audio/2019-12-27/new-home-sales-to-see-slow-steady-growth-mohtashami-radio
The decade is finally over and there was NO tanking of any kind in the RE market. And it will be YEARS before we hit another bottom. Other than Millie, most people don’t have the time to put their lives on hold indefinitely hoping and praying for the next bottom.
It’s another beautiful New Year’s day in socal. Bright and sunny and highs close to 70 degrees. And don’t think people in other parts of the country don’t notice this. Looking forward to the 2020s in socal. People tend to forget the title of blog, “How I learned to love socal and forget about the housing bubble.”
None of the RE shills can forget about the bubble. You need an army of RE cheerleaders to sucker in the last buyers before it all crashes again. If buying would make sense you wouldn’t need the propaganda.
Nobody says to wait decades. Every ten years the market crashes hard. So just wait a little bit and buy half off. Pretty simple.
Here’s an affordable 3 bedroom with 2 bath home just a few miles from the beach for spoiled millennials who whine that they can’t buy a home in LA:
https://www.zillow.com/homedetails/1702-E-66th-St-Los-Angeles-CA-90001/20931780_zpid/
The barrios of LA are full of houses like these that may need a little work. Just rent out rooms, a back yard shed, and the garage to make the payments like the illegals do.
That’s evidence for the bubble. This crapshack is worth 20-40k. Don’t overpay for crapshacks.
I keep telling my local Ferrari salesman the same thing. This will be the year that he sells me that 488 for a 70% discount just you wait and see….
Smart choice Sally!
Waiting for buying opportunities has always worked well for smart investors. Just ask good ol Warren. Buy low, sell high.
The other way around doesn’t work that well unless you like to be foreclosed on.
That home qualifies as a “Real Home of Genius”.
You will need to bulletproof your car to make that drive to the beach.
That crapshack is located in a rough neighborhood. Nothing like waking up in the morning and trying to decipher the new gang-tags on the sidewalk outside your new home.
That’s not just what illegals do it’s what everyone who is lower middle class does, that or go on section 8 and work the system. 350k is big bucks for the average Joe. But its chump change for the elite, they will buy it and rent it for profit to section 8 renters. Everything in America is geared towards the elite and exploiting the poor. We should revolt.
Guys, I didn’t think this could happen but we have a new one on the list
Besides our top ones:
This is the year when millennials buy in droves
Buy now, the Chinese are coming
Buy now or be priced out forever
Buy now or you will never own
Buy now, interest rates are still low
Buy now, it’s a great time to buy
We have now:
Buy now, millennials are getting old (pushing 50)
Yep, only 30 more years and you are in your sixties. Better get going with the home buying!
The RE cheerleader creativity is one of the reasons why it doesn’t get boring here!
When someone inherits a house in Ca, he/she benefits in two ways:
Property tax is assessed at original purchase price. So the property tax remains very low
Fed Capital gains tax is assessed at market value. So if the inheritor wants to sell the property after two years, the capital gains tax is assessed on the difference between sale price and the market value (and not original purchase price) at the time of inheritance.
So if you inherit a property which your parent bought for say $200,000 and whose market value is now $2 million, you will pay property tax as if YOU bought it several years ago for $200,000. But if you hold the property for two years and sell it for 2.5 million , then you pay capital gains tax on $500,000 and not on $2,300,000.
Yeah, that is how it works, primary residence and income properties.
2020 – falling housing prices.
San Diego, CA Housing Prices Crater 11% YOY As Southern California Slips Deeper Into Mortgage Defaults And Mortgage Fraud
https://www.zillow.com/san-diego-ca-92104/home-values/
*Select price from dropdown menu on first chart
A noted economist stated, “If you have to borrow for 15 or 30 years, you can’t afford it nor is it affordable.â€
Borrowing money for 30 years has been the norm for decades when buying homes. Not just in socal, but in flyover country too. This is how housing is made affordable on a monthly basis. Anybody who doesn’t understand this concept didn’t learn basic math. What has rent done in the past decade in socal? Can your noted economist comment on this. This is why you lock in a fixed housing payment unless you think your rent will be the same or less in the year 2050. Again, not rocket science we are dealing with here.
Sorry JJ, you are still confused. Median home price for a small sample size is biased up or down based on the size/quality of homes that happened to sell that month. That is why Zillow uses an algorithm to determine market trends.
Here’s a simplistic example:
November: Sale 1 = $380K Sale 2 = $400K Sale 3 = $600K
December: Sale 1 = $380K Sale 2 = $600K Sale 3 = $610K
Median home price increased by 50% in one month! Actual home values may have gone up or down (more information on the properties is needed to determine this) …Or, maybe you understand this already and want to mislead people???
housing to bust in 2020 for really real this time!
Stocks up 1% to start 2020.
Housing crash imminent.
2019 was a very good year on the stock market. Waiting for a housing dip to pick up another property. I’ll be a buyer when I can purchase for 12 X annual rent.
You are talking about a pretty good dip there. Or you hope rents will skyrocket. Haven’t we heard that before.
As a cash buyer I can jump quickly when a good deal comes along. Lately I have seen some probate sales turn over at my price point. 12 X annual rent gives me about 8% return on my investment.
All that work for 8% ROI. Sad. But also funny
Still can’t figure out why permabulls come to a housing bubble blog, ignore the evidence presented in the articles, and argue nonstop about how real estate “is different this time.” Just screams of insecurity.
RE cheerleaders seem panicked as of late. During this fantastic, historic economic expansion, their crapshacks aren’t appreciating. None of the lies have worked so far:
There is no inventory
The Chinese are coming
Millennials will buy in droves
Gen z will buy in droves
This spring season will
Be epic
Bidding wars are back
Buy as long as interest rates are still low
Reality check: price drops across the board and overpriced crapshacks sit and sit and sit.
By your logic, permabears shouldn’t be here either. Only people uncertain about the future should be coming here, in order to gain insight. Not anyone confident, bull or bear.
Why does Milli keep coming here, year after year, pasting the same posts, again and again. The same “cheerleader talking points,” again and again. Posting the same boilerplate, multiple times per thread.
Why does JamesJim keep posting that the “bubble has already popped,” month after month, thread after thread. Multiple times per thread.
Screams insecurity, no?
Perhaps they desperately hope to start a panic, because sellers still stubbornly refuse to drop their prices by 70%.
No, that’s not my logic. This is a housing BUBBLE blog. So it makes sense for people who believe we’re in a housing bubble to come here. There are also ZERO permabears here. There are simply people who truthfully say that real estate is cyclical and there will be a correction at some point. We can debate about how much it will go down, but there are several posters here who deny it will ever happen. And a few who make fun of anyone who says it will go down.
This is like having LA Dodgers fans join an SF Giants forum and talk about how bad the Giants are. Again, if you don’t believe we’re in a bubble and think real estate goes up forever, then why come to a housing bubble blog at all?
First of all, why would you think I am a perma Bear?
I am a realist and RE expert, sharing helpful infos and data lines.
Second, can you imagine me not being here? You like my posts and would miss me.
Third, sometimes you have to repeat a thing or two because people forget quickly. For instance, i think not everyone knows yet that a 50-70% housing crash is coming.
Forth, someone should keep track of all the lies RE cheerleaders distribute here. I like doing it.
I don’t begrudge those who say they want to wait to buy. We moved to the South Bay in 2008 and waited until 2012 to buy. We bought at the bottom. While I agree with the permabulls to a small extent that if we were to sell today and buy with our added equity (our house has doubled in 7 years), we would then be buying near the top and selling near the top.
The only people who come out ahead are those who buy before gentrification of an area, where the dips don’t go down much. Buying El Segundo 2 dips ago would have been a great investment. Anyone thinking Manhattan Beach will see a serious dip is mistaken. Premium properties may dip 10-20%, but nothing like the non-premium properties.
So those waiting to buy be sure to do your homework. Try to buy into a gentrification trend so you don’t end up in the huge swings of non-premium properties and your property holds value.
My opinion the best sign of gentrification is improving school scores. We bought Lawndale and the Elementary School District is top drawer and improving. Unfortunately, the high school district is a mess. Hopefully, once the construction ends, Lawndale will take back their High School and make it a much better place for learning.
Lawndale? The selling prices of home have risen a lot since 2008 but the public schools still mostly suck. Take a look at the low ratings of some of the schools in the Lawndale area:
William Green Elementary School: 4/10
Lawndale High School: 4/10
Leuzinger High School: 4/10
There’s also a lot of crime in the areas along Manhattan Beach Boulevard and Crenshaw Boulevard.
https://www.trulia.com/CA/Lawndale/
Hi all, I am currently living with my in-laws. Hubby and I are willing to buy but prices are too high. If they would be half of what they are now I could see us making an offer. We have been sending low ball offers but haven’t had much success. Hopefully Trump can help millennials out by changing laws so that millennials can buy.
“Hopefully Trump can help millennials out by changing laws so that millennials can buy.”
I give this troll post a solid B+. I would have given an A had you added something related to boomers.
The world is waiting for the boomers to die off so we can clean up the mess your generation created…there will be major changes in the US once your oblivious greedy ignorant generation is gone
LOL Trump is a billionaire who made much of his money by screwing over people on RE deals.
This guy isn’t going to help anyone with their housing issues at all. He and the Repub controlled Congress had a year to do something about housing prices and all they did was pretend it wasn’t a issue at all.
If anything he’ll likely try to use his position in office to run a scam of some sort. Techinically he is already doing that with the way he is billing govt. services for using his facilities (which he requires BTW).
Real estate and housing prices are not uniformly high across the country or even within cities across California. Only an ignorant dimwit would try to blame Trump and the Republicans for high prices in certain areas of California instead of blaming your corrupt Democrat socialist masters who’ve completely controlled California and every major city in the state for DECADES. Your corrupt Democrat socialist masters have made it almost impossible to build new housing by imposing outrageously high development fees, restrictive zoning, and burdensome regulations. Your corrupt Democrat socialist masters have made the housing situation in the state worse with their open border policies by bringing in millions of illegal aliens who are competing for available housing. You and your corrupt Democrat socialist masters are to be completely blamed for the mess that they’ve made of the once great state of California.
Just because the RE prices aren’t uniformly too high across the country doesn’t mean they’re still way too damn high.
I didn’t blame Trump for high RE prices, I just pointed out he and the Repub controlled Congress didn’t do a thing to correct it. Don’t put words in my mouth or attempt to gaslight me.
CA wasn’t controlled by Dems for decades. Only recently with the 2018 election could you say the legislature was controlled (finally) via a supermajority of Dems. FWIW many of CA’s RE problems were either created or exacerbated by Reagan’s actions.
Also you can’t blame regs and rules for most of the costs of RE these days. Prices have been increasing out of line with inflation or construction costs for a while now.
TTS,
Creating sanctuary cities and state and promoting illegal immigration is the action of democrats. You don’t have to believe me; just listen to all the democrat politicians from CA and you will agree with me. That is a FACT.
More people means higher demand for housing – first for rent, and second through higher ROI for buying RE (by investors). It destroyed the quality of life for 90% of the people in CA in two ways – depressed the wages of poor people and impoverished the middle class through lower purchasing power. On the other hand it increased the purchasing power of the rich democrat politicians. This is ECON. 101.
What I stated above refers strictly to supply and demand in RE. I did not get into negatives which lower the quality of life like: more cars on roads (gridlock), more taxes to support education, food, extra expenses for the justice system and housing for so many extra people. It is sad to be blinded by politics and not being able to see the facts based on cause and effect. IF, and that is a big IF, there are any benefits to so many extra uneducated people, those benefits are for the richest in CA, not for the poor or middle class. And when you think that the democrats portrayed themselves as the champions of the middle class while taxing them into the ground!….
tts posted: “Just because the RE prices aren’t uniformly too high across the country doesn’t mean they’re still way too damn high.”
Home prices are not too damn high everywhere in the US. The average sale price of a home in Detroit was $50K last month. The median price of homes currently listed in Baltimore is $112,900. Homes can be had for under $200K in California in cities such as Coalinga where the median home value is $165K.
https://www.redfin.com/city/5665/MI/Detroit/housing-market
https://www.zillow.com/baltimore-md-21215/home-values/
https://www.homesnacks.net/most-affordable-places-in-california-126800/
tts posted: “I didn’t blame Trump for high RE prices, I just pointed out he and the Repub controlled Congress didn’t do a thing to correct it. Don’t put words in my mouth or attempt to gaslight me.”
You most certainly did try to blame Trump. You gaslighted yourself and then tried to play the victim like a typical Democrat socialist loser.
It was your Democrat socialist hacks in Congress like Rep. Barney Frank and Senator Chris Dodd who created the last housing crisis and the subsequent financial meltdown with their meddling banking regulations and loan quotas that were based on race and ethnicity.
http://archive.boston.com/bostonglobe/editorial_opinion/oped/articles/2008/09/28/franks_fingerprints_are_all_over_the_financial_fiasco/
https://www.forbes.com/sites/georgeleef/2014/01/10/one-bad-law-usually-leads-to-others-the-housing-bubble-and-dodd-frank/#5303793e5be3
tts posted: “CA wasn’t controlled by Dems for decades. Only recently with the 2018 election could you say the legislature was controlled (finally) via a supermajority of Dems.”
Democrat mayors have controlled LA since 1961 except during a brief period during the 1990’s when a RINO named Richard Riordan was mayor. The LA city council has been dominated by Democrats for decades.
Democrat mayors have controlled San Francisco since 1964 and the city council has been dominated by radical Democrat socialists for decades.
Democrat socialists held trifecta control of state government from 1999 to 2003 and again from 2011 to present.
tts posted: “FWIW many of CA’s RE problems were either created or exacerbated by Reagan’s actions.”
LOL! Leave it to an old ignorant Democrat socialist dimwit to try blaming California’s problems on Reagan who was California’s governor in the middle of the last century and president in the 1980s.
tts posted: “Also you can’t blame regs and rules for most of the costs of RE these days. Prices have been increasing out of line with inflation or construction costs for a while now.”
In most California cities dominated by your Democrat socialist masters, they have made it almost impossible to build new housing by imposing outrageously high development fees and taxes, restrictive zoning, and burdensome regulations. Then they import millions of illegals who compete for housing. Your corrupt Democrat socialist masters are to be blamed for high housing costs!
@Flyover
I didn’t say word one about sancturary cities in either my posts so why are you talking about them? Stay on topic or don’t post.
CA’s population growth has been incredibly low for a while dude. Less than 1% in 2018 and 2017. Its the lowest its been since 1900. For the entire US population growth has been less than 1% per year since 2000. So as a broad generality its true that more people will cause more demand for housing but in the US and CA population growth isn’t a real driver of housing prices and hasn’t been for nearly 2 decades.
Reduced quality of life has FAR more to do with wage stagnation and a reduction of benefits/pensions than it does with the housing bubble(s) we’ve had these last couple of decades too.
There is also a helluva lot more to economics than Econ101 and you’ve got to put more work in if you want to understand the economy dude. Econ101 is after all just a rudimentary primer or intro to economics and much like Phys101 its not actually meant to be used for anything. So all you’re doing by saying, “its ECON101” is demonstrating your ignorance to me.
And yes compared to historic or recent Repub policies on taxes and wages the Democrats are indeed the champions of the common people. Democrat politicians have flaws but you don’t see the Democrats putting the US $1 trillion into debt just to give the money to rich people. Over half of which went to OVERSEAS rich people/businesses on top of that!!
TTS@ “And yes compared to historic or recent Repub policies on taxes and wages the Democrats are indeed the champions of the common people. Democrat politicians have flaws but you don’t see the Democrats putting the US $1 trillion into debt just to give the money to rich people. ”
So, in your opinion, the republicans are at fault for lowering the taxes? They increased the standard deduction which help most of the middle class and poor people. They also double the child CREDIT from $1,000 during Obama to $2,000. If someone has 2-3 children they probably pay zero taxes unless they are surgeons.
Champions for common people (democrats) = flood the work force with millions of legals and illegals to keep wages down in a race to the bottom.
Obama doubled the national debt with trillions of dollars (more than all US presidents combined); the republicans don’t have a corner in borrowing.
I agree than ECON 101 is not enough and that there are far more factors at play; however, regardless how much complexity exists, you can not ignore the basics (I took all the advanced economics all the way to MBA). That was my point.
@RealityBites
Actually they pretty much are and if you’re going to hold up places like Baltimore or Detroit as examples showing the opposite of that then you’re just demonstrating you don’t know what you’re talking about. Both of those places have depressed economies for wage earners who actually live in them and depressed wages to go along with that too. They’re also both in general decline and are places people are usually trying to move away from because they’re generally terrible to live. For wage earners living there they’re actually pretty expensive too BTW even if they look cheap compared to CA.
No I did not blame Trump for the entire bubble. The entire reply chain is easy to see and read and my replies were clearly in response to a poster who thought Trump would do something to fix the bubble in 2020. I pointed out that he was A) a known RE scammer and B) did nothing to fix the bubble when the R’s had control of Congress from 2017 to 2018 and therefore there is no reason to expect him to do anything to fix it in 2020. No gaslighting (do you even know what that term actually means?) or playing the victim at all. Just facts.
Both of the articles you linked are flat out opinion pieces and are clearly labelled as such BTW. The 1st one is dishonest since it makes claims about something Frank said in 2003 (and for 2003 was correct, the bubble was barely even forming at the time) and tries to apply them to events that A) happened 5yr later and B) were after Fannie and Freddie were forced to take on lots of jumbo loans by Congress and the Republican administration of the time. Fan and Fred loans actually were going down as a total of all mortgages made around 2005 to 2006 or so until those rule changes got forced through.
The 2nd article is a guy who subscribes to known failed economic philosopher Mises which auto disqualifies them as credible.
There also no loan quotas nor were there requirements that loans had to be made based on race. There were anti redlining rules which is possibly what you’re referring to that required banks make the loans available to everyone regardless of race but the banks were still supposed to be doing their due diligence and making sure people could afford the loans instead of just fogging a mirror.
Mayors and council members don’t set policy for the whole state or for the whole country do they? You know they don’t.
Some of Reagan’s policies (as are some of FDR’s too, policies can last long after someone is dead) are still in effect and as long as they are then he still gets to bear at least some of the blame for CA’s housing issues which have been getting worse for decades.
There are certainly zoning issues in CA and all throughout the US but there have been for decades due to the continuous push to expand the suburbs and neglect the urban and inner city areas as well as little to no funding for public transport and both parties can be blamed for that.
Also its worth pointing out that only a handful of Democrats are anything actually close to real Socialists and most are farther Right than that with a handful being effectively Republican in terms of economic policy (google Blue Dog Democrats).
@Flyover
Sure the Repubs are at fault for lowering taxes. If you lower taxes by putting the country massively in debt, and then give nearly all the tax cuts to rich people anyways, then that is a net loss long term for the country as a whole. You realize long term they’ll have to RAISE taxes to pay for those cuts right? The alternative being to massively inflate the currency and destroy saver’s wealth and further erode wages buying power….
The tax credit for kids (under the age of 16, other restrictions apply BTW) being doubled also runs into the same issue. Its all being funded with debt. Something that the supposedly fiscally responsible Repubs care about (which they didn’t, they were always fine blowing trillions on the military for instance).
Illegals usually work on farms and most of those farmers vote Repub BTW. They’re not having much impact on fast food or other min. wage jobs. Also Dems were the ones who have been pushing for increased min. wage to 12-15/hr and have done so successfully in places like Seattle. The Repubs claimed this would destroy the local economy several years back but it did the opposite.
Most the debt during the Obama years was from Bush’s wars + bailouts. Some of that he can take the blame for but the lion’s share came from Repubs who used accounting tricks to try to keep it off the books for their tenure.
You don’t understand. Econ101 isn’t even ‘the basics’!! ITS A PRIMER!!! Its there to introduce you to different concepts but none or little of it can actually be applied to reality. That is why I brought up Physics101 as a comparison since it doesn’t deal with things like frictions: its also totally useless for real world application.
That is why anyone who runs around saying stuff like, “its Econ101” is inadvertently admitting they don’t know what they’re talking about. They’re just spouting the primer material as if its a proof without any real understanding of the flaws of said primer are.
So go ahead and keep talking about Econ101 Mr. MBA man.
@TTS,
You bring the issue of increased minimum wage. Repeat after me: A minimum wage will always buy a minimum wage lifestyle because the inflation it causes. If minimum wage increases would lift the workers off the poverty, those workers in Venezuela and Zimbabwe will all benefit from socialism. The FACT is that even after an increase of 3000% last year, those pour souls in Venezuela can not buy anything with it. The socialists ASSUME that there are some productivity which can be increased and it was not increased to date. That is a false assumption. Because of that, raises in minimum wage always cause inflation. INFLATION= the most REGRESSIVE form of taxation on the poor and middle class.
The poor in Seattle will pay more in SS and Medicare tax and from what is left they will pay substantially more on rents. There are other negatives to that, but the post will get too long. In short, those on minimum wage in Seattle will be worse off. UW, a liberal university to the max., published a paper condemning the increased in minimum wage and show that those workers will be worse off because of the increase in minimum wage. Increases in minimum wage, like rent control is a form of price fixing, dictated by some communist politician. Price fixing NEVER works. If it would work, they would do price fixing on food. The reason they never do that is because the effects will be visible within weeks instead of months or years or hidden. Empty shelves would remove them from power in short order. They may be evil, but not stupid – they understand the effects of their actions.
In regard to military, my position is that all wars are banker’s wars and I would prefer the budget to be for defense only, not imperial wars. However, regardless of the party in power, all foreign policy is done by CFR and TC and nothing changes.
The Democrats always complain about income inequality but they never eliminate the taxes for the poor (SS and Medicare) and middle class. I never saw them (not just talk) increasing the taxes only for those making over 1 million per year. They always increase taxes for the middle classes. Seeing that the GOP decreased the taxes for many poor and middle class is welcome. Yes, I wished they would have decreased them more (I heard they plan to do that this year).
The problem with the deficits is the spending. The government grew so much that it suffocates the private sector, killing the host. Yes, Trump, GOP, the FED and all democrats are equally at fault. During Obama, they spent just as much as during Trump. Obama had the Congress for 2 years and instead of decreasing the taxes on the middle class to generate demand, they put another millstone around their neck with Obamacare (according to SCOTUS, it is a tax to be enforced by the IRS). That sunk the middle class further while bailing out the largest banks. Yes, under Bush (another globalist) the bailout was proposed, but Obama implemented it.
The problem with the national debt is the FED, not the lowering of taxes. Without the FED, the Treasury can print the money (instead of a private cabal) and no debt would occur and no interest would be paid.
It’s different this time! Buy now or be priced out forever!
https://www.mercurynews.com/2020/01/03/poll-california-housing-markets-most-likely-to-underperform/
Uh oh, RE cheerleaders are not going to like that news.
RE cheerleaders: Hurry, find a new NAR propaganda article stating this spring season will be epic and that spring season is now. Also, millennials and gen z are going to buy in droves this year.
Milli: Also, millennials and gen z are going to buy in droves this year.
You’re making up stuff. NO ONE ever said that Gen Z is “going to buy in droves” THIS YEAR.
HERE is one prediction that I’ve read: https://www.marketwatch.com/story/watch-out-millennials-generation-z-is-poised-to-dominate-homeownership-2019-12-19
When Gen Z reaches this same age in 15 years, 45% of the economists polled believe that more than 60% of them will be homeowners. Another 20% believe the home-ownership rate will be the same across the two groups, while 35% believe it will be lower for Gen Z.
In 15 years. Not THIS year.
If you, Milli, know of anyone who predicted that Gen Z will “buy in droves” THIS YEAR, please post a link.
I agree with you flyover…great points……I can tell you what benefit the US as well as any other country in the world gains from having a ton of uneducated people……..more worker drones!!! A ton of people that can be exploited for cheap labor. Put people in horrible situations where they can be exploited for cheap labor…where the people will do anything for a buck cause they have to….all while promoting freedom and how wonderful capitalism is by allowing these people to choose what company to be exploited by…..take a look at the sweatshops of the world….those people aren’t there cause they want to…..they are there cause they have to……next up……USA!!!…..God Bless America….at least its elite anyways….the rest can enjoy the 3rd world country it’s become….the United states of Mexico
Iran attacks will cause house prices to crash by 98%
– Probably said at ZeroHedge today
Only schmucks read Zero Hedge.
So Emma, you mean that Trump should write an Executive Order forcing all homeowners who sell to give Millennials a 50% discount ? Wow! In that case, me and 20 million other potential buyers just declared ourselves to be Millennials. You know, in the PC age you can declare yourself to be anything you want. And who wouldn’t want that discount! We’ll be
watching for it. Manhattan Beach Strand, you’re within my grasp! (Well, maybe half a
Strand tear down, or a quarter…).
As of today I am a 23 year old transgendered 1/2 Native, 1/4 Hispanic, 1/4 Black, woman. Where my free stuff at?
No one is buying your 100k crap shack for 900k….shuddup boomer
It’s Different This Time, Pop- McFarland, WI Housing Prices Crater 12% YOY As Madison Housing Market Turns Toxic
https://www.zillow.com/mc-farland-wi/home-values/
*Select price from dropdown menu on first chart
A noted economist stated, “If you have to borrow for 15 or 30 years, you can’t afford it nor is it affordable.â€
Tom Brady is selling his house in the Boston area.
Any takers?
https://www.latimes.com/business/real-estate/story/2020-01-04/hot-property-tom-brady-looks-to-score-in-the-massachusetts-housing-market
The current state of the housing market is unlike what we’ve seen in history. There are a ton of factors to consider why these prices are inflated. Low interest rates, low inventory and high material costs means financing is cheap, supply is limited and builders aren’t building. If interest rates creep up, it’ll bring prices down, if builders flood the market with new housing, it’ll bring prices down which cuts into their already thin margins. But prices aren’t going to miraculously come down. We’ll hit a period of stagnation and let inflation plus increased wages do it’s thing. We’re not going to see a drop in nominal price but we will see a drop in value.
New age,
In your new age economy won’t be any job-loss recession, right?
Recessions are a thing from the past and from now on we only see bull markets?
Here in California they are building everywhere they can.
But I agree, it’s still not enough. I think we need to change zoning laws. Build a few skyscrapers with 5-10k units each and you have your supply. We need to build up high.
So you’re saying it’s different this time? Lol amazing. People never learn.
Home of Genius: https://www.redfin.com/CA/Compton/2718-W-Tichenor-St-90220/home/7340516
Compton crapshack, 3/1, 1,125 sq ft — offered for over $400 million!
Yeah, it’s probably a misprint. I’m guessing the realtor meant $400k. Even so, the listing has been up for 5 days, and they still haven’t corrected it.
It’s still pretty funny.
Milli has his crash! Not just 70% — not just 90% — not just 99% — but an EPIC crash of nearly 99.9%
That Compton house’s price just CRATERED (to borrow JamesJim’s word) from over $400 million to just $400,000.
Time to buy this Compton jewel, Milli.
Clap clap you found a typo that was corrected quickly.
You have nothing else to do? No job?
The house is overpriced at 400k. Maybe if it were offered between 100-120k we could make something work there.
Housing CRASH!! lol
CNBC
Jan 2, 2019
Competition for housing is so high, the spring market is starting now
“The severe shortage of homes for sale is upending the sales calendar for the whole housing market. Spring has historically been the busiest buying season, but as competition for homes heats up across the country, January is the new April. Spring starts now.
The numbers are telling. From 2015 through 2018, the peak month for average views per listing on Realtor.com was April. January lagged by a full 16%. In 2019, however, January was the busiest month on the site in 20 of the largest 100 metropolitan markets.”
___
Remember what uncle Mr Landlord keeps telling you, renting long term is financial suicide. Don’t do it.
Mr. Landlord, you are correct. In my Orange Co. city, there are virtually no homes for sale under $800,000. In past few weeks, EVERY HOME listed for sale under $800,000 has entered escrow. All the MLS shows are homes which are “pending” or “contingent.”
It is obvious that buyers are not buying homes because they like them but are desperately buying anything which is available.
OC Register RE Columnist Lazerson who writes the Mortgages column has 6 predictions for the next decade.
1) RE Agent and mortgage broker compensation will be squeezed badly which will lead to a combined lobbying group to work on their behalf.
2) New government-sponsored enterprises will compete with Fannie Mae and Freddie Mac. This may include creating mortgage lines of credit that follow you from property to property.
3) Solar and other forms of self-produced energy will take over providing for the majority of homes in California.
4) ATTENTION MILLIE!!! California home prices are going to take a huge tumble. 25 to 50% is his prediction. He sees stagflation, not a deflationary depression as the cause. This will come after the median SoCal price reaches $900K. High taxes and stagflation (with poor economic growth) plus extraordinary housing price increases will cause this drop to be biggest here.
5) The number of California young adults living with their parents will reach 45% And 15% of households will be three generational. The new granny flat laws will make this even more likely.
6) Mortgage loan originator compensation will be deregulated leading to better deals for CA shoppers. He says that the unintended consequences of Dodd-Frank compensation rules created a sort of shell game (my words not his, but I think they condense his long explanation).
The Iraqi Parliament has voted to expel US Troops from Iraq. Sunni Arab and Kurdish minority legislators boycotted the vote. I hope we are out of the area before the big Sunni-Shia war breaks out there. The Sunni center of Mosul is already in ruins thanks to Daesh. Hopefully, the assassination of the Quds leader Soleimani is Trump’s parting gift to the country of Iraq. Our 8 bases in Kuwait are enough to protect what interests we have in that hellish region. That’s where people we know are being sent right now.
House prices are down in several East coast states. House price in CT and IL are below their 2006 / 2007 price. Why? IMHO, it’s because their GDP hasn’t been able to keep pace with their public sector pay/pension. State has to raise more tax to close the funding gap. Tax rise has become onerous. CA has similar problem. But CA has a huge GDP. As Buffet said, only when the tide goes down, you know who’s swimming naked. So it is with finance. Only when the recession hits and GDP goes down…
All too true. Worse, as though our pensions weren’t already unsustainable, Gov Pritzker just hastened Illinois’ march towards insolvency, increasing pension benefits for public employees.
Meanwhile, while recreational MJ has become available and people bought $11 M worth the first few days of the year, the boom likely won’t last long and users will return to their street dealers, because the state taxes double the price of the stuff, making it very uncompetitive with the offerings of the illicit dealers, thus defeating one of the major benefits of legalization.
It Already Popped- San Diego, CA Housing Prices Crater 11% YOY As Southern California Slips Deeper Into Mortgage Defaults And Mortgage Fraud
https://www.zillow.com/san-diego-ca-92104/home-values/
*Select price from dropdown menu on first chart
A noted economist stated, “If you have to borrow for 15 or 30 years, you can’t afford it nor is it affordable.â€
Follow the link yourself, it shows San Diego is up 3% YoY and forecasted to be up again this year.
Why even bother posting garbage.
Rising Income – CHECK
Rising Rents – CHECK
Low interest rates – CHECK
Low inventory – CHECK
Of course prices are going to be up again. Until that changes there is no decline.
All I know is that here in South Orange Co., homes are selling like hotcakes. Homes under a million dollars are selling within a few weeks and there is simply not inventory. Almost all the homes listed in the MLS are either “pending” or “contingent.” There is practically available. It is hard to have dropping prices if there are no homes available to drop the price of.
We know the economy is booming. Has never been better!
Most people are making a killing and saving a lot. No consumer debt and millennials and gen z are going to buy in droves next month because spring season has started in January.
Sounds all good, except there is this thing called reality:
https://on.mktw.net/36xbj9P
Oh crap it’s a marketwatch article. Anything that is not coming from the NAR cannot be true right?
Milli: No consumer debt and millennials and gen z are going to buy in droves next month because spring season has started in January.
Milli, stop lying. NO ONE ever said that Gen Z is “going to buy in droves†NEXT MONTH.
HERE is one prediction that I’ve read: https://www.marketwatch.com/story/watch-out-millennials-generation-z-is-poised-to-dominate-homeownership-2019-12-19
When Gen Z reaches this same age in 15 years, 45% of the economists polled believe that more than 60% of them will be homeowners. Another 20% believe the home-ownership rate will be the same across the two groups, while 35% believe it will be lower for Gen Z.
In 15 years. Not NEXT MONTH.
If you, Milli, know of anyone who predicted that Gen Z will “buy in droves†NEXT MONTH, please post a link.
The link you provided showed “home values have gone up 3.0% over the past year and Zillow predicts they will rise 1.5% within the next year. ”
A noted economist stated, “If you have to borrow for 15 or 30 years, you can’t afford it nor is it affordable.†I went 15 years and I found my $2000 mortgage with dual income to be super affordable.
The link you provided showed “home values have gone up 3.0% over the past year and Zillow predicts they will rise 1.5% within the next year. ”
A noted economist stated, “If you have to borrow for 15 or 30 years, you can’t afford it nor is it affordable.†I went 15 years and I found my $2000 mortgage with dual income to be super affordable.
Year over year price drop, checking in:
https://www.santacruzsentinel.com/2020/01/03/median-home-price-drops-to-889500-in-november-for-santa-cruz-county/
CRASH IMMINENT!
CNBC
Jan 6, 2019
Mortgage rates fall further, as buyers rush into the first open houses of 2020
“The average rate on the 30-year fixed mortgage fell to the lowest level since October this week, at 3.69%, according to Mortgage News Daily. That has an already competitive housing market heating up even more. Open houses, which are usually pretty rare the first week in January, were plentiful in markets across the nation this year, as buyers hope to get in before the competition gets even worse.
Buyer sentiment in the housing market remained high in December, according to a monthly survey from Fannie Mae — the Home Purchase Sentiment Index. In general, Americans said they did not expect mortgage rates to go up, and they expressed increasing confidence in both their household incomes as well as their employment.”
___
What does uncle Mr Landlord keep telling you kids? You know it. Repeat it after me. Renting long term is financial suicide, don’t do it.
CRASH INCOMING!!
Seattle Times
Jan 7, 2019
Amid falling inventory, brokers predict a return to 2017 ‘hotness’ in Puget Sound housing markets
“Some parts of King County have one-quarter the number of homes on the market as a year ago, and buyers are moving quickly to snap up what homes are for sale. If current trends hold, spring may bring a return to the housing market frenzy of two years ago, brokers say, spelling bad news for affordability around Puget Sound. Check the map to see what’s happening in your area.”
WAR!! IRAN!! Oil spike, depression! Housing toncrash by 40% in 2020
It Already Popped- Calabasas, CA Housing Prices Crater 12% YOY As Rampant Appraisal Fraud Spins Out Of Control
https://www.zillow.com/calabasas-ca/home-values/
One broker stated, “this business is full of criminals and felons.â€
It Already Popped- Dallas, TX Housing Prices Crater 20% YOY On Surging Inventory And Plunging Demand
https://www.zillow.com/dallas-tx-75240/home-values/
*Select price from dropdown menu on first chart
As a noted economist stated, “Residential construction costs have slipped under $50 per square foot.â€
CRASH IMMINENT
“Housing market sentiment rose in December, according to Fannie Mae, as a strong labor market and low mortgage rates boosted consumer confidence. The Home Purchase Sentiment Index rose to 91.7, nearing the record high of 93.8 set in August, Fannie Mae said in a report on Tuesday. The share of people who said it was a good time to buy a home jumped 16 percentage points from a year ago to 59%. While the number decreased from the prior month, that’s a typical pattern for December when people are busy with the holidays.”
Here is socal, prices have peaked. Inventory keeps building up and overpriced houses are not selling. It feels a little bit like 2008. For those that were too young. In 2005 house prices peaked and then there was a slow decline until the market collapsed. History seems to repeat itself. Realtors and sellers are getting very nervous.
Am I the only one that finds monthly housing sales statistics worthless? Considering escrow takes 30 days, your running numbers in the time it takes to complete a transaction. It takes more than 1 month to buy a house, between viewing homes, making offers, signing all the paperwork and closing escrow it’s more than a month process. Persuading people to buy a house based off info from one month to the next is nonsense…..November 30th wasn’t a good time to buy but December 1st was a great time to buy a sales increased by 2.3 %…..no crash is coming! Also little timmy’s lemonade stand was stagnant from 110-11 am but sales rocketed to 6.8% from 12-1pm….obviously the time to invest in lemonade is now. The lemonade business will be here forever, the hourly reports prove it….buy now or be priced out forever…….your statistics are nothing but blowing smoke up the people’s ass with a swirly straw.
Living with my parents has been the best thing. My girlfriend, also in her mid 30’s doesn’t mind it. She’s also living with her mom.
I saved some money and are waiting for a big crash so I can buy a nice house. Why should I buy some ugly house for too much money? I rather wait and buy a nice house once we have a big crash. Thinking we will see a recession this year. Fingers crossed.
Don’t lie. You’re just waiting for your folks to die so you get the house. Pretty entitled here, aren’t we?
Pushing 40 and living with mommy and daddy. Talk about living the American dream. Are you sure this girlfriend you speak of isn’t the imaginary kind?
Southern California house price gains pick up in November, and it’s an early selling
season starting in January.
“Appreciation rates ranged from 1.7% in Orange County to 3.7% in the Inland Empire, CoreLogic’s Home Price Index shows.”
“Inland Empire house prices, for example, were up 3.7% in the year ending in November, compared with year-over-year gains of 2.9% in Los Angeles County and 1.7% in Orange County.”
Hang on! The RE roller coaster is headed up. The bears are trying to get out of the way.
This housing slowdown is so severe that I can honestly say that I haven’t seen something like this in the last 30 years of my career. Houses aren’t selling.we had open house after open house and price reduction after price reduction. Nobody made an offer. This ship is sinking very fast in California.
You must not be a good a very good realtor. Prices keep going up YoY. Maybe get on social media? Only old folks go to open houses. What a waste.
“This housing slowdown is so severe that I can honestly say that I haven’t seen something like this in the last 30 years of my career.”
Yeah…it’s crazy. The house down the street from me in SD county went pending in 11 days. Can you believe that? It took 11 days!?!? Last year that house would have went pending in less than seven. This ship is sinking fast.
Hola! We want buy house! Big nice house. We have 2 families wanting to bitch in and buy together. 3sqft and big backyard. Offer 400k, please ping me. Right now, very crouded. All families live together in small house. Need crash in market to buy at good price. Too much money right now.
Yes…Is nice. I too want big crazy house. I live with wife/sister, 2nd wife/cousin, parents, grandparents, great-grandparents, 3 strangers , six dogs, 2 chickens, and a monkey. Is so crowded in one bedroom apartment. I need big crazy American home with 2 bedrooms and indoor bathroom. Ping me. Have cash or will trade for animal.
Funny indeed, however, I am a white US California born American…I used to live in a 2 bed 1 bath apartment with 10 people including myself, and we had a dog. Many times I would pee in a bottle or outside because the bathroom was in use…….God bless America. Were on our way to having legit slums in the US and being a 3rd world country.
The housing crash on 2020 is something we will have never seen before. Valuations will be cut in half and a severe recession is coming.
Be careful people.
This is a complete fantasy. There is an ocean of credit available at the top for speculators and America now has giant real-estate corporations that will happily scoop up any property that gets anywhere near being reasonably priced in relation to future rental income.
You really need to understand what is happening with credit at the Federal Reserve, or none of this will make sense. Yes, California housing used to boom and bust. And, yes, this is different — there has been complete regulatory capture of the credit creating institutions by Mr. Market. That’s the first time in American history this has happened.
You might get a little dip, for sure, but the fire sales of 2009-14 are never coming back because Mr. Market controls the money supply now.
Brixton77, you are correct in your assessment of what is happening. Where I don’t agree with you is on your assumption that the FED wants the prices to ALWAYS increase. My assumption is that most of the crashes are engineered for one reason or another and when they want to crash it again they will do it. I agree with you that the market is supper manipulated, that they wanted to pump it up, but I also believe that if and when it will serve their purpose, they will dump it just as well.
Looking at the history of the FED, it is all about pump and dump.
Thomas Jefferson:
“If the American people ever allow private banks to control the issue of their money, first by inflation and then by deflation, the banks and corporations that will grow up around [the banks], will deprive the people of their property until their children will wake up homeless on the continent their fathers conquered.”
Alan Greenspan [now Fed Chairman] wrote in 1966:
“[The] abandonment of the gold standard made it possible for the welfare statists to use the banking system as a means to an unlimited expansion of credit …. In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. There is no safe store of value. If there were, the government would have to make its holdings illegal, as was done in the case of gold …. The financial policy of the welfare state requires that there be no way for the owners of wealth to protect themselves …. [This] is the shabby secret of the welfare statists’ tirades against gold. Deficit spending is simply a scheme for the ‘hidden’ confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights.”
Thomas Jefferson:
“If the American people ever allow the banks to control issuance of their currency, first by inflation and then by deflation, the banks and corporations that grow up around them will deprive the people of all property until their children will wake up homeless on the continent their fathers occupied.”
Flyover you are 100% correct! That’s the part the permabulls just don’t seem to grasp. Those who in control of the money supply and interest rates don’t give a crap about the middle class or percentage of Americans who own homes. What they want is to have all of the assets for themselves – and the way to do that is continual pumps and dumps. These are not “natural” ups and downs of the housing market over the past 30-40 years.
Anyone buying right now is a sucker. Yes it’s true that long-term renting is a bad idea, but buying into a peak is an even worse idea.
Did your magic 8-ball tell you this?
This is beyond the pump and dump. In all past pump and dumps, the Fed had plenty of room to cut interest rates during the recession. Now they have no room at all. There is widespread anxiety that, in the event of a recession, what the Fed has left (QE to infinity) will not work and the entire economic system will unravel. Because this is a truly unique situation, the Fed will throw absolutely everything at trying to avoid a recession. The Fed knows that we have reached the limits of using monetary policy to prop up the economy.
And fiscal police remains stuck: 40 years of tax cuts for corporations and the rich have created a situation in which money is pooled entirely at the top, suppressing consumer demand. The obvious solution to that is to raise taxes for the rich, redistribute money to the lower classes, and get consumer demand cooking, but there’s no politcal will for that. Also, everyone knows that America needs trillions of infrastructure spending but there’s also no political will to do that either. So, there’s no obvious fiscal rescue for the economy coming in the event of a recession.
Since monetary policy is about tapped out, and there is no fiscal policy, it’s anyone’s guess what will happen when this goes south. In the meantime, the Fed will do absolutely everything it can to avoid finding out what happens when an economy with near-zero interest rates goes into recession. How long they can hold the debt dike? Your guess is probably better than mine.
It Already Popped- Home Prices Stall In Bay Area After Seven Year Tech Party
https://www.zerohedge.com/markets/home-prices-stall-bay-area-after-seven-year-tech-party
From the OC Register. Tenants in LA and OC suffer nations second largest rent hikes. Rents were up 5.5% in 2019. Ouch! What have we always said about long term rental strategies in places like socal. Don’t do it!!!
https://www.ocregister.com/2020/01/14/tenants-in-l-a-orange-county-suffer-nations-2nd-largest-rent-hikes/
It Already Popped- Agoura Hills, CA Housing Prices Crater 16% YOY As Los Angeles Housing Market Swirls The Bowl
https://www.zillow.com/agoura-hills-ca/home-values/
https://snag.gy/m5EzRB.jpg
I know you like to spam this board with the same “bubble has already popped” blurb, but the Zillow page you link says that the Zillow Home Value Index is down 0.3% from last year.
Where do you get your 16% “crater”?
I don’t think you will get any response to your question, Son of a landlord.
JimJim also posts the exact same posts under a different name on ZeroHedge.
WolfStreet is now filtering out his Spam.
He seems to rely on clickbait statements to troll.
JimJim was Speed Racer’s monkey on my favorite show as a child.
It Already Popped- Manhattan, NY Housing Prices Crater 15% YOY As Every Major US City Exhibits Double Digit Price Declines
https://www.zillow.com/new-york-ny-10025/home-values/
*Select price from dropdown menu on first chart
A noted economist stated, “If you have to borrow for 15 or 30 years, you can’t afford it nor is it affordable.â€
It Already Popped- San Mateo, CA Housing Prices Crater 15% YOY As Bay Area Rental Rates Plummet
https://www.zillow.com/san-mateo-ca/home-values/
https://snag.gy/m5EzRB.jpg
Thanks you James for posting informative data showing how this bubble is crashing fast.
It just proves that we will see 50-70% price drops soon.
In the meantime, our RE cheerleader have a new hope. Gen Z will buy in droves! Any day now!
We will have a correction someday but that is not this year or anytime soon from the look of it. I am not going to try and predict a slow down or crash but for those that think the recession has started are using too much CBD haha
https://finance.yahoo.com/news/falling-mortgage-rates-set-off-172646393.html
December housing starts up 17%, to a 13 year high. WOW! Sorry millie, looks like another year, at least before the 70% crash shows up.
Wow, inventory up, prices down and no sucker left to buy. RE cheerleaders must hate this time. They should have listened and sold. Now it’s probably too late.
More nonsense. Call a date for the crash. Do it. Don’t be a pathetic loser who can’t commit to anything. What’s the date Mille? When is everyone going to stop drinking from the sweet fountain of equity that you can only admire from afar?
One thing to consider is the credit ratings of millenials…As the most in debt and financially burdened generation on the history of the US, not surprisingly most millenials have poor credit. Even with 50% price reductions if a crash happens…..the millenials will finally be able to afford…..but won’t be approved
If Millie would have bought in 2012 when the market started zooming up, he
could have suffered thru a 2020 recession and loss of 50% asset value, and
still would have made a fist full of dollars! With, of course, NO recession he
lost even more! Not to mention an investment with 5 to 1 leverage, i.e.- 20%
down, tax deductions, possible income stream (Airbnb), fixed low interest rate loan (almost free money), ascetics of gardening etc., etc.. A no brainer to most. An enigma
to a bear.
Totally right Market Man. The smart Millennials saw the great opportunity from 09 and up. They bought, even if it meant forgoing avo toast and 6 dollars lattes for a bit. Those who did are enjoying YoY equity like crazy. Our Mille just can’t stand he missed out. There will never be an opportunity like the last decade again in RE. It was a once in a century event.
Give Our Millennial a break. He was only pushing 16 in 2012. Most of us were still getting a $10/week allowance at that age or making out like bandits as paperboys/girls at $100/month. Our Millennial could not afford a house when even minimum wage did not apply to him.
The Millennials who were in their teens from 2008-2014 missed out on the worst Republican crash since the Depression. Captain Bush steered us all onto the rocks with his all-Republican crew from 2003-2007 with the Gilligan’s Island 108th and 109th Congress. No denying that. Just look it up.
History does repeat itself.
Captain Trump is sailing into a hurricane. Our Millennial may have a chance and take advantage of an upcoming crash that will make following generations hate him as much as he hates Boomers.
Buying r/e between 2009 and 2011 made a lot of people rich. Millie and his cohorts missed out and are lashing out. All boils down to that. At least they enjoyed organic GMO free craft beer, LOL.
Seen it all before, Bob: Give Our Millennial a break. He was only pushing 16 in 2012.
Our Millennial claims to be in his 30s, so in 2012 he would have been in his 20s, at the very least.
If he’s in his late 30s, he might even have been 30 in 2012.
Correct. I am in my low 30’s.
Most importantly something very big is happening in my life. More to come soon.
OK, even if Our Millennial is 32 now, when housing prices hit the bottom in 2010, he was 22 and in college. in 2012, he might have been 24. just out of college.
I don’t know of any 22-24 year olds who can buy a house at any price. Did you? Just to get a mortgage, you would need a few more years of employment to earn a downpayment and employment history.
The exception would be if he had a rich Boomer parent who had the foresight to buy him a house in 2009-2012. My crystal ball broke during the Northridge quake. Many of these boomers were struggling to keep the house they had without job.
I bought my first house when I was 25. My crystal ball was still working and I had to have a silent generation parent co-sign since I was only out of college for a few years. Most of my peers could not buy a house back then in S. CA.
Bobby,
Plenty of people buy houses in their early 20s. You just have to forgo the $17 avocado toast sandwiches, $12 craft beers and daily $7 mochas to do it.
17+7+12=36
Landlord I double it. Let’s say a millennial buys 2 of those avo toasts, craft beers and mochas every single day. That would be 72 bucks a day times 365 days to get you to the annual savings number.
That’s 26,280 dollars a year savings by fighting the avo toast addiction.
Is that your downpayment? Sure it is…..in Spokane!
In California, you only have to do this 10 years and you got your downpayment for the 1.2m dollar crapshack!
It Already Popped- Reno, NV Housing Prices Crater 13% YOY As Housing Demand Slows To A Trickle
https://www.zillow.com/reno-nv-89519/home-values/
*Select price from dropdown menu on first chart
As one broker lamented, “We can’t find buyers after slashing prices 20% or more.â€
Your link says YOY Down 1.6% — not 13%
Where’s your “crater”?
It Already Popped-Bay Harbor Islands, FL Housing Prices Crater 23% YOY
https://www.zillow.com/bay-harbor-islands-fl/home-values/
https://snag.gy/m5EzRB.jpg
Your link says YOY Down 4% — not 23%
Where’s your “crater”?
It Already Popped-Falls Church, VA Housing Prices Crater 13% YOY As Arlington County Housing Prices Tank
https://www.zillow.com/falls-church-va-22046/home-values/
*Select price from dropdown menu on first chart
As a leading economist advises, “Mortgage debt is the most toxic and damaging debt of all. Avoid it at all costs.â€
Your link says YOY UP 5% — not down 13%
Where’s your “crater”?
It Already Popped- “Reality Is Officially Here”: Nobody Buying Homes In Greenwich Is Paying Top Dollar Anymore
https://www.zerohedge.com/personal-finance/reality-officially-here-nobody-buying-homes-greenwich-paying-top-dollar-anymore
I am about to buy my first home with my dad in a hip hood in San Diego with a price of $700k. We will have to put $120k down, $120k and 6mos in repairs but will have (4) 1br rentals.We project $1,500 income each on two units and we will live in the other two units each valued at $1,500/mo. We will have a $3,700 mortgage. Thoughts from any pros?
Have you factored in property tax, maintenance, utilities, and insurance costs? Insurance costs have skyrocketed in CA recently due to the wildfires and San Diego has some of the highest water and electricity costs in the country. I assume utilities are incl for $1,500?
Sounds like a good buy. Assuming the repairs are more than just cosmetic stuff and no structural issues. Wondering what hood you mean. Ideally you come up with additional 20k to avoid the PMI. But you probably need the cash for renovations and repairs. Anyways, Congrats! Good buy.
We need a little more info here. Is this a 4 bedroom house or is this a quad plex (4 separate units). If this property really has 4 separate units and can generate 6K rent per month, there should be a line of investors trying to snap this up for 700K. If this is the case, jump on it TODAY.
I think he means a 4 bedroom house. I could be wrong.
I own multiple rental properties and couldn’t imagine the nightmare of living across the hallway from a tenant. But that’s just me. Good luck with that.
Is $3700 PITI or just mortgage? Makes a big difference.
Also where do you come up with $1500? Is that something you eyeballed or is this something you know will rent based on comps? And make sure the comps are like for like. For example if your building is on a busy street, use comps on a busy street, not a quiet street, that kind of thing.
Also factor in maintenance/repair costs. Rookie landlords never do.
You want at least 8% return to make a viable rental.
Mr. Landlord, are you saying 8% net or gross return?
IMO, considering current sale prices in SD, getting 5-6% net ROI on a new purchase is good. If you can net 8% ROI on a newly purchased property today in SD you are winning big time.
Every investor will have their own opinion on what is considered a good return for them.
Cash on Cash. Doesn’t matter if it’s SD or Wichita, If you can’t get a minimum of 8%, don’t do it.
https://www.reuters.com/article/us-wells-fargo-occ/u-s-bank-regulator-sharpens-teeth-on-wells-fargo-surprising-critics-idUSKBN1ZN2BR
citibank holding foreclosures off market for years.
It Already Popped- New Home Sales Disappoint, Slump To 5-Month Lows
https://www.zerohedge.com/personal-finance/new-home-sales-disappoint-slump-5-month-lows
Case Shiller Index is in for YoY Nov 2019.
Prices up in the 20 city index by 3.5%
This release includes prices for 20 individual cities, two composite indices (for 10 cities and 20 cities) and the monthly National index.
https://www.calculatedriskblog.com/
It Already Popped- US Pending Home Sales Plunge Most Since 2010
https://www.zerohedge.com/personal-finance/us-pending-home-sales-plunge-most-2010
https://www.forbes.com/sites/johnmauldin/2020/01/02/the-fed-has-quietly-started-qe4/#139597093768
QE4 is here. No crash anytime soon.
The crash is here. Housing market came to a full stop
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