The DFW housing market is NOT sustainable (Leonard, Point: office, transit)

[NP78]

Originally Posted by Wittgenstein's Ghost

I can't imagine buying a $1.5MM property at Texas property tax rates and 6.5%+ mortgage rates. 5x salary under those conditions is crazy. Even with a 20% down payment ($300k), PITI would be ~$12k, or $144k per year. That's half of gross income. A bank wouldn't approve that, and only a fool would take it if they did.

True. Plus as it relates to the discussion of buying in places like University Park, $1.5M is probably lot value for anything that is not on Lovers Lane. Realistically for a single family detached home that is not on Lovers the bottom end of the market is $2M, so barring some significant source of equity/down payment, $300k HHI is not enough to afford UP.

[TheOverdog]

so barring some significant source of equity/down payment, $300k HHI is not enough to afford UP.

Can none of you read? I already addressed down payment. Why does everyone here address every mortgage payment as though everyone is first time buyer, again 1% percent of the UP market. Man you guys all love debating fantasy purchases.


Also the median household income in UP is only $247k, so I hope everyone has lived there a long time, because otherwise, they are all about to be priced out due to taxes and maintenance too.

[aggie972]

Originally Posted by TheOverdog

Can none of you read? I already addressed down payment. Why does everyone here address every mortgage payment as though everyone is first time buyer, again 1% percent of the UP market. Man you guys all love debating fantasy purchases.


Also the median household income in UP is only $247k, so I hope everyone has lived there a long time, because otherwise, they are all about to be priced out due to taxes and maintenance too.

W-2 income doesn't come close to telling the whole story in UP. A lot of people there own a business or have a trust fund, or both.

[Wittgenstein's Ghost]

Originally Posted by TheOverdog

Can none of you read? I already addressed down payment. Why does everyone here address every mortgage payment as though everyone is first time buyer, again 1% percent of the UP market. Man you guys all love debating fantasy purchases.

We read what you said perfectly fine:

Originally Posted by TheOverdog

At $300k, you could have a $300k-$500k downpayment in less than a decade.

A $300k down payment leaves PITI of $12k. That's not even close to working, and adding an extra $200k to the down payment doesn't change anything.

[DFW_FTW]

2 more rate hikes coming. Should’ve bought the house when this thread originally went live more than 12 months ago.

Powell: “We now see housing putting in a bottom, and maybe moving up a bit”

We’re in peak housing market due to seasonality. Rates are grinding up and bidding wars are starting to pick back up for homes In the $400-$600 range.

Let me guess: blah blah blah bunch of hot air …. DFW is not sustainable

Prepare for the housing melt up I’ve been taking about.

Next people to feel the pain is current homeowners when they see their 2024 escrows thanks to higher taxes and insurance premiums.

You’re gonna start to feel the housing squeeze over the next 12 months.

[Xalistiq]

Whatever was left of the Federal Reserve’s already non-existent credibility was completely diminished on Wednesday after Powell’s “hawkish” pause speech.

The Fed’s “wait and see” strategy — which saw them deny inflation as nothing but transitory the entirety of 2021 — is exactly what led us down this destructive and inflationary spiral in the first place.

While the Fed and its captive financial media laud a declining CPI, core inflation is not just sticky, it’s rising. According to CNBC:

“That's because core inflation — which excludes volatile food and gas prices — remains high at a year-over-year rate of 5.3%. In May, core inflation rose by 0.4%, following steady monthly increases averaging 0.4% so far in 2023”.

https://www.cnbc.com/amp/2023/06/13/...-persists.html

The entity sworn by mandate to protect price stability has destroyed it. Through inflation, the Fed continues to reward the rich, while stealing from the poor and middle class. And they do so without an ounce of accountability, brazenly emboldened by an apathetic, comatose public and a bought-and-paid-for press.

For the immense and irreparable damage the Fed has inflicted on the dollar, the housing market, and for stealing young people’s future — the Fed deserves the most grievous condemnation.

Meanwhile, the dollar continues to slide on the global reserve market. The dollar saw an -8% decline in its share of global reserves in 2022 alone, according to Yahoo:

https://finance.yahoo.com/news/natur...125500087.html

But Janet Yellen doesn’t see anything wrong. She insists the dollar is in no danger of diminishing as a world reserve currency because there’s no viable replacement. The same woman who emphatically insisted that inflation was “transitory” until December 2021, despite a multitude of economic data at her fingertips. How can anyone take these people seriously?

What Yellen really means is there’s no viable dollar replacement yet.

The dollar declined -20% between December 2000 and December 2022 as a percentage of global reserves:

https://www.rbcwealthmanagement.com/...ecember%202022.

And then there’s the emergence of BRICS country’s upcoming gold-backed, sanctions-eluding multi-national currency/payment system. Whether or not the BRICS currency dethrones the dollar is a moot point. To honestly believe that this commodities-backed currency — whose founding nations represent 40% of the world’s population — will not slowly chip away at the dollar’s increasingly perilous reserve status is simply delusional.

Bottom line, the Fed’s repeated monetary blunders and willful incompetence have screwed us all.

[Wittgenstein's Ghost]

Originally Posted by Xalistiq

“That's because core inflation — which excludes volatile food and gas prices — remains high at a year-over-year rate of 5.3%. In May, core inflation rose by 0.4%, following steady monthly increases averaging 0.4% so far in 2023”.

The quote above is factually incorrect, and evidently CNBC's "Make It" staff, which is already amateur hour, realized the same because they have since reworded it to say this:

That's because core inflation — which excludes volatile food and gas prices — remains high at a year-over-year rate of 5.3%. In May, core inflation rose by 0.4%, following steady monthly increases averaging 0.4% so far in 2023.

Prices are rising, core inflation is not. I'm not surprised that the writers who spend most of their time telling us about the four foods Harvard nutritionists never eat and the six words that can make you sound smarter don't know the difference between rising prices and rising inflation.

You can view core inflation here: https://tradingeconomics.com/united-...inflation-rate


The Fed has taken us from over 8% to 4% and thus far hasn't kicked off a recession. Every prognosticator there was thought we'd be in a recession by now. They've balanced on the tight rope better than anyone could possibly have asked for, so their credibility is pretty good in my book right now.

Pausing was the obvious move, and you only disagree because you are rooting against the economy.

[Leonard123]

Originally Posted by Xalistiq

Whatever was left of the Federal Reserve’s already non-existent credibility was completely diminished on Wednesday after Powell’s “hawkish” pause speech.

The Fed’s “wait and see” strategy — which saw them deny inflation as nothing but transitory the entirety of 2021 — is exactly what led us down this destructive and inflationary spiral in the first place.

While the Fed and its captive financial media laud a declining CPI, core inflation is not just sticky, it’s rising. According to CNBC:

“That's because core inflation — which excludes volatile food and gas prices — remains high at a year-over-year rate of 5.3%. In May, core inflation rose by 0.4%, following steady monthly increases averaging 0.4% so far in 2023”.

https://www.cnbc.com/amp/2023/06/13/...-persists.html

The entity sworn by mandate to protect price stability has destroyed it. Through inflation, the Fed continues to reward the rich, while stealing from the poor and middle class. And they do so without an ounce of accountability, brazenly emboldened by an apathetic, comatose public and a bought-and-paid-for press.

For the immense and irreparable damage the Fed has inflicted on the dollar, the housing market, and for stealing young people’s future — the Fed deserves the most grievous condemnation.

Meanwhile, the dollar continues to slide on the global reserve market. The dollar saw an -8% decline in its share of global reserves in 2022 alone, according to Yahoo:

https://finance.yahoo.com/news/natur...125500087.html

But Janet Yellen doesn’t see anything wrong. She insists the dollar is in no danger of diminishing as a world reserve currency because there’s no viable replacement. The same woman who emphatically insisted that inflation was “transitory” until December 2021, despite a multitude of economic data at her fingertips. How can anyone take these people seriously?

What Yellen really means is there’s no viable dollar replacement yet.

The dollar declined -20% between December 2000 and December 2022 as a percentage of global reserves:

https://www.rbcwealthmanagement.com/...ecember%202022.

And then there’s the emergence of BRICS country’s upcoming gold-backed, sanctions-eluding multi-national currency/payment system. Whether or not the BRICS currency dethrones the dollar is a moot point. To honestly believe that this commodities-backed currency — whose founding nations represent 40% of the world’s population — will not slowly chip away at the dollar’s increasingly perilous reserve status is simply delusional.

Bottom line, the Fed’s repeated monetary blunders and willful incompetence have screwed us all.

Those seem like "brown numbers" to me. Just in the last couple weeks, the cost of beef and potatoes, among other things, has gone up more than I've ever seen them go up in the past two years. I don't think interest rate hikes are going to help the situation. The culture that's been driving the economic trends has to shift.

The underlying problem was the panic created in 2020 and people's persistent unwillingness to do business, live, and work the way they did before. There's plenty of blame to go around with the politicians, but the society who puts them in power bears most of the blame. If they had increased interest rates higher and faster, it would have made no difference. This is not an economic problem; it's a cultural problem.

I can understand your sentiment to an extent. What we have now is drastically worse than a recession in my opinion. A major recession would be an improvement if it would fix the underlying problem. Sadly, that doesn't seem to be in the cards.

[Wittgenstein's Ghost]

To clarify my post above, core inflation didn't go up because of a .4% monthly change. A positive inflation number doesn't mean inflation is rising; it means prices are rising. Core inflation is decreasing, just as CPI is decreasing:

[Xalistiq]

Originally Posted by Wittgenstein's Ghost

The quote above is factually incorrect, and evidently CNBC's "Make It" staff, which is already amateur hour, realized the same because they have since reworded it to say this:

That's because core inflation — which excludes volatile food and gas prices — remains high at a year-over-year rate of 5.3%. In May, core inflation rose by 0.4%, following steady monthly increases averaging 0.4% so far in 2023.

Prices are rising, core inflation is not. I'm not surprised that the writers who spend most of their time telling us about the four foods Harvard nutritionists never eat and the six words that can make you sound smarter don't know the difference between rising prices and rising inflation.

You can view core inflation here: https://tradingeconomics.com/united-...inflation-rate


The Fed has taken us from over 8% to 4% and thus far hasn't kicked off a recession. Every prognosticator there was thought we'd be in a recession by now. They've balanced on the tight rope better than anyone could possibly have asked for, so their credibility is pretty good in my book right now.

Pausing was the obvious move, and you only disagree because you are rooting against the economy.

CNBC didn’t reword the quote in question. What you posted is verbatim the text I quoted, which is still in the article. I misread the quote.

Core inflation has in fact been relatively flat for much of 2023, and just recently showed a slight decline in May. A one month decline isn’t sufficient evidence to suggest that core inflation is falling.

Relative to historical norms, core inflation remains disturbingly high and sticky. And given the strong labor market, it is unfathomable that you believe pausing is the right move. What’s not surprising is that you think Fed credibility is good. You are a Fed apologist, after all.

I’m not rooting “against the economy”. I’m rooting for a balanced economy and a balanced housing market.