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Not likely in desirable coastal enclaves. Looking at RE sites the last couple of years our little cottage regularly goes up $20-50k / mo. Not likely to maintain that appreciation but seems likely to at least hold steady with newly strict loaning protocols. Economy here is strong and if not exactly paying all the bills for everyone it still provides high salary employment for those with the skills.
I bought a 1-bedroom condo on the 4th floor at the bottom of the crash 6 years ago for $123,000. Now someone managed to sell a 2-bedroom condo on the 1st floor in the same building looking at the radio tower and parking lot for $255,000.
OK, she painted the walls. That's about it. Yup, time for a price correction.
Last year, I bought a lovely home in a good area, and I had to outbid two other buyers to get it. I'm told that this year, the market is even hotter, and that houses are being sold within hours of being listed.
I've got a couple friends that are Realtors, and they're telling me that the market is super-heated right now with no sign of cooling off.
Have we come to the end of another real estate cycle? Are prices going to drop off a cliff soon?
Is there going to be a crash? Yeah eventually. When? Who knows. I dont think it will be as bad as the last one unless people go out of control borrowing against their houses and the lending standards relax and they get rid of the Dodd Frank act. You’ll just have a bunch of hedge funds buying up houses all over the country and decreasing houses available for sale.
I bought a 1-bedroom condo on the 4th floor at the bottom of the crash 6 years ago for $123,000. Now someone managed to sell a 2-bedroom condo on the 1st floor in the same building looking at the radio tower and parking lot for $255,000.
OK, she painted the walls. That's about it. Yup, time for a price correction.
If you bought at the bottom of the crash and are in a desirable area why would you not think the housing market has corrected itself?
I'm not one to say "This time is different." But it is really important to realize what is driving this surge as opposed to the last one. What was driving the last spike in prices was speculation based on easy credit.
Meanwhile, what is driving this spike in prices is lack of inventory.
I'm not one to say "This time is different." But it is really important to realize what is driving this surge as opposed to the last one. What was driving the last spike in prices was speculation based on easy credit.
Meanwhile, what is driving this spike in prices is lack of inventory.
What burst that mess was the MBS debacle.
Some say we are seeing rise of MBS markets again. The question is whether too much rotten paper is being mingled with good paper and misrepresented to investors.
However, there is a HUGE auto loan bubble with $345 billion worth of subprime loans in this country right now. Total auto loans are $1.1 trillion nationwide and the delinquency rate is at an all time high. That's scary.
Well, if the government stopped raising standards of minimum function for automobiles, there would be less debt. It's almost impossible to get an older vehicle to pass inspection anymore and they're starting to require inspectors to plug in the coding machine instead of letting mechanics determine roadworthiness. Nice going, Auto-Manufacturing Lobbyists. At a time when mandatory expenses are at an all-time high, throw a car payment in there!
What burst that mess was the MBS debacle.
Some say we are seeing rise of MBS markets again. The question is whether too much rotten paper is being mingled with good paper and misrepresented to investors.
While LBS or MBS investment activity is on the rise, there are still two differences:
1. The “garbage” loans can’t be as bad, due to tougher underwriting.
2. The Credit Default Swap instrument isn’t there.
While LBS or MBS investment activity is on the rise, there are still two differences:
1. The “garbage” loans can’t be as bad, due to tougher underwriting.
2. The Credit Default Swap instrument isn’t there.
I am more intrigued by inflationary forces than a lending/securities bubble.
If, if, iffffff….. we get into inflation big time, paying for an overpriced house with 2018 dollars and 2018 interest rates may well look pretty good in 2025.
I am not saying this as an agent to push anyone to buy. Not at all. People need to make their own decisions on their perceptions, paths and personal destinies.
I'm just conversing.
People tend to get hung up on one metric and lose perspective on the big picture.
Last edited by MikeJaquish; 05-18-2018 at 08:01 AM..
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