Dallas market is crazy!! (Plano, Richardson: insurance, mortgage, credit issues)

[aggieplaya]

Originally Posted by turf3

"Extraordinary Popular Delusions and the Madness of Crowds", by Charles MacKay. Anyone who fancies himself a critical thinker needs to read this.

Anyone who uses a tulip frenzy as a comparison to the Dallas REAL estate market is fancily deluding themselves into being a critical thinker...

[numbersguy100]

Originally Posted by aggieplaya

Anyone who uses a tulip frenzy as a comparison to the Dallas REAL estate market is fancily deluding themselves into being a critical thinker...

That's fair, but people who can't fathom any reason for a decline in the Dallas market are also not displaying critical thinking skills.

[aggieplaya]

I never said a decline isn't possible in Dallas. Not likely in the foreseeable future based on existing market conditions and demand. Economic conditions are very favorable in Dallas, and demand is still high for homes so the facts are the facts.


Will this bubble burst at some point? Probably. When the economy suffers, the real estate market will suffer. Back in 2008 or so when the economy and housing tanked, it was not near as severe to Dallas prices as compared to Florida and California as an example. So I just don't buy this simplistic view that we should all put on tin foil hats and worry about some massive collapse in the housing in Dallas.

[turf3]

You mean the economics classes taught by the same geniuses who have created the enormous trade deficit, have told us that deficit spending doesn't matter, have supported the massive exportation of middle class jobs, and to top it off lost something like 40% of the Harvard and MIT endowments in the last economic crash?

Or are you trying to say that we don't have record low interest rates and massive deficit spending? Are you trying to say that housing is more affordable now than it was 50 years ago, when a shipping clerk and a school teacher could buy new cars and buy a house on a 15 year mortgage?

[turf3]

And,

I always say if it looks like a duck, walks like a duck, and quacks like a duck, it's probably a duck. Another way to say it is - if you hear hoofbeats, think horses, not zebras.

Bidding wars on houses located in the distant exurbs. A constant drumbeat of "get yours now before the price goes up even higher". An acceleration in the rate of rise of prices. "Shortages" of houses for sale.

Look out, here comes that herd of zebras.

[aggieplaya]

Who is beating the drumbeat of "get yours now"? A market consists of a willing buyer and willing seller. There are people that want to own a home, so yes they are unfortunately competing with many other buyers to buy a home right now, those are the conditions we are in.

I don't know of anyone that is desperately buying because of the frenzy, they are still buying because they desire home ownership. In many situations there is a job relocation involved, in others they are at the end of their lease and don't want to continue renting. No one is forcing anyone to 'buy' a home and no one is holding pep rallies to beat a "you should buy now" drum either.

[TheOverdog]

and to top it off lost something like 40% of the Harvard and MIT endowments in the last economic crash?

From Harvard's own website: Harvard Management Company | Investment Management | Performance History

The annualized return on the endowment over the last 20 years has been approximately 12.0% per year and the endowment was valued at $37.6 billion at June 30, 2015. In fiscal year 2015, distributions from the endowment contributed over a third of the University's operating budget.

It's nice of you to be concerned about their fund management skills, because apparently they aren't.

[serger]

Originally Posted by aggieplaya

I never said a decline isn't possible in Dallas. Not likely in the foreseeable future based on existing market conditions and demand. Economic conditions are very favorable in Dallas, and demand is still high for homes so the facts are the facts.


Will this bubble burst at some point? Probably. When the economy suffers, the real estate market will suffer. Back in 2008 or so when the economy and housing tanked, it was not near as severe to Dallas prices as compared to Florida and California as an example. So I just don't buy this simplistic view that we should all put on tin foil hats and worry about some massive collapse in the housing in Dallas.

The reason prices here didn't drop much (with few exceptions in the posh areas, btw) during the last bust, is that they never increased much in the years prior. Our previous house was built around 2000, and the value in 2007 or so, was still about the same, just a bit higher. And then it dropped a little. Now this same house is up something like 60%.

[Johnhw2]

Prices going higher, but time its NOT different. Demand out pacing supply of homes near job markets in DFW as well as supply not keeping pace largely due to development bottlenecks and fewer infill land options where demand is high, are driving the increase. This will stop when job growth declines or when supply catches up in the right places or some combination of these two.


People owning homes out number people buyings homes here by a wide margin and the silent majority is smiling for the most part. The choices are price drops or rises, flat is an option too but I prefer rising home prices for my home!

[EDS_]

Originally Posted by turf3

You mean the economics classes taught by the same geniuses who have created the enormous trade deficit, have told us that deficit spending doesn't matter, have supported the massive exportation of middle class jobs, and to top it off lost something like 40% of the Harvard and MIT endowments in the last economic crash?

Or are you trying to say that we don't have record low interest rates and massive deficit spending? Are you trying to say that housing is more affordable now than it was 50 years ago, when a shipping clerk and a school teacher could buy new cars and buy a house on a 15 year mortgage?

1. Economists didn't create our trade deficit(s). Consumer demand and political expedience are to blame.
2. Only a few very left wing economists and a few left wing politicians claim deficits don't matter.
3. Harvard's endowment is up since the crash to new all time highs. MIT's too I think.
4. We do have low interest rates but I don't mis-explain how or why.
5. In 1950 (1950-2015 was the only data span I could easily find good numbers for) the average home sold was 983 sq. ft., cost $7400 and average family income was $3,300. In 2015 the average home sold is 2,519 sq. ft., cost $299,000, and average family income was $53,700. So adjusted per square foot, the only rational measure, since 1950.........home prices are down just a tad relative to income.
6. A shipping clerk and a teacher can easily buy a 983 sq. ft. home, and bigger if the want, on a 15 yr. note and a new car now.