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Old 05-23-2022, 05:30 PM
 
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There will be retrenchment, most acutely in the overpriced areas. But lots of areas will not for several reasons: 1) The lending requirements are much tighter and 2) The interest rates are far lower.



I spent a lot of time consulting in the mortgage banking business in the 00s, and it was absolutely insane what was getting underwritten at the time. In no way is this anything like 2008.
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Old 05-24-2022, 08:34 AM
 
26,198 posts, read 21,675,770 times
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Quote:
Originally Posted by Mikala43 View Post
When you look at the number of new construction nationwide, the numbers have dramatically reduced since 2005-ish.

That's nationally.
There’s a difference between dramatically reduced since 05 and not seeing ANY construction over 14 years.
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Old 05-24-2022, 09:22 AM
 
Location: North of Canada, but not the Arctic
21,220 posts, read 19,840,420 times
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Probably the same people who in 2008 were saying we weren't in a bubble. lol

On the outskirts of my city (Detroit), the housing boom is in full swing. They can't build and sell homes fast enough. The cost of building materials has skyrocketed. There is a massive shortage of construction workers. Even in the older neighborhoods, houses are selling for astronomical prices. Houses are selling the day they go on the market or within a few days. Over asking price.
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Old 05-24-2022, 09:57 AM
 
956 posts, read 513,398 times
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Quote:
Originally Posted by Retroit View Post
Probably the same people who in 2008 were saying we weren't in a bubble. lol

On the outskirts of my city (Detroit), the housing boom is in full swing. They can't build and sell homes fast enough. The cost of building materials has skyrocketed. There is a massive shortage of construction workers. Even in the older neighborhoods, houses are selling for astronomical prices. Houses are selling the day they go on the market or within a few days. Over asking price.
Yup exactly. And for all of those who say it is different this time and lending standards are not like 2008. Well we still have little to no money down loans. We still have HELOCs which means people are treating their homes like piggy banks. That is a big part of what got us into this mess.

Only real difference may be not as much overbuilding and lack of inventory. But that is largely because of the dirt cheap financing available like the pre-2008 days. Only thing changed is the complete no doc loans, but even that has loopholes people use to get loans they cannot afford. See frankrj's posts.

Only sad difference now is builders have intentionally created an artificial shortage of homes encouraged by government and entitled home owners who are irresponsible and use HELOCs/treat homes like piggy banks to ensure these products are available while pricing others out forever without them drowning in worst ever mortgage debt for at least 30 years if not more. Itrs this obsession from the government and many home owners that home fast rising home values and home equity that can be used as HELOCs is needed for a strong economy when in reality there are other ways such as before the 1990s!! Its a shame really and I hope it blows up!!

Last edited by Wolverine607; 05-24-2022 at 10:27 AM..
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Old 05-24-2022, 10:15 AM
 
8,021 posts, read 3,955,154 times
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Quote:
Originally Posted by MinivanDriver View Post
I spent a lot of time consulting in the mortgage banking business in the 00s, and it was absolutely insane what was getting underwritten at the time. In no way is this anything like 2008.
Everyone would be wise to listen to your words - the words of someone with first-hand knowledge.
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Old 05-24-2022, 10:17 AM
 
8,021 posts, read 3,955,154 times
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Quote:
Originally Posted by Retroit View Post
Probably the same people who in 2008 were saying we weren't in a bubble. lol...
We were not in a bubble in 2008. Prices are far higher now then they were in 2008. Thus, 2008 was inexpensive compared to today. Thus, no 2008 bubble.
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Old 05-24-2022, 10:32 AM
 
26,198 posts, read 21,675,770 times
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Quote:
Originally Posted by Wolverine607 View Post
Yup exactly. And for all of those who say it is different this time and lending standards are not like 2008. Well we still have little to no money down loans. We still have HELOCs which means people are treating their homes like piggy banks. That is a big part of what got us into this mess.

Only real difference may be not as much overbuilding and lack of inventory. But that is largely because of the dirt cheap financing available like the pre-2008 days. Only thing changed is the complete no doc loans, but even that has loopholes people use to get loans they cannot afford. See frankrj's posts.

Only sad difference now is builders have intentionally created an artificial shortage of homes encouraged by government and entitled home owners who are irresponsible and use HELOCs/treat homes like piggy banks to ensure these products are available while pricing others out forever without them drowning in worst ever mortgage debt for at least 30 years if not more. Itrs this obsession from the government and many home owners that home fast rising home values and home equity that can be used as HELOCs is needed for a strong economy when in reality there are other ways such as before the 1990s!! Its a shame really and I hope it blows up!!
If you think there’s no real difference between mortgage financing leading up to 07-09 and now you are clueless. It tells me it’s very likely you weren’t ever in the business but certainly haven’t been in during both periods of time. Adding this to your other comments it seems you’d be better as a msnbc/fox/cnbc drama talking head than you would be someone who understood what they were talking about
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Old 05-24-2022, 10:50 AM
 
Location: Taos NM
5,369 posts, read 5,171,932 times
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We have a housing shortage, but not necessarily a square footage shortage. Right now we are at a demographic weird point, millennials are at prime buying last year AND boomers aren't quite in retirement phase. In 6 years, boomers will be more firmly retired, zennials won't be as numerous as millenials, and there'll be more inventory constructed.

All this is to say we are really dealing with a frozen market where transactions at the edge are treated as baseline. Once the market thaws, companies allow more wfh as that trend continues, and the labor force shrinks, we're going to have a different demand scenario than 2019. To say this is the new normal and it's all up and up from here is as foolish as to say there's going to be some widespread collapse. Lending tightness ensures there won't be a collapse, but it does not mean there won't be stagnation or decreases.
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Old 05-24-2022, 10:51 AM
 
Location: Juneau, AK + Puna, HI
10,622 posts, read 7,842,942 times
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Quote:
Originally Posted by ncole1 View Post
Can anyone look at this graph....and then honestly say we are not in a bubble? Keep in mind these numbers ARE ADJUSTED FOR INFLATION!!!


https://fred.stlouisfed.org/series/CSUSHPINSA

I'd agree that it appears we're in a housing bubble, where demand exceeds supply. So what?

The bubble might keep growing indefinitely, eventually flatten out or even pop. No one really knows.
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Old 05-24-2022, 11:19 AM
 
Location: Formerly Pleasanton Ca, now in Marietta Ga
10,370 posts, read 8,615,741 times
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Quote:
Originally Posted by Wolverine607 View Post
We are not only in a housing bubble, but an everything bubble due to ZIRP and stupid crappy money lending little to no downpayment and QE policies.

Can't count the number of times I have seen Rocket Mortgage commercials about people looking for money in their house and taking about turning equity into cash. LMAO. Was anything learned from 2008?? Heck no!!! Lenders still encouraging people to use their homes as piggy banks!! Degusting!! I swear at the TV whenever I see such commercials when watching the NBA and NHL Playoffs!! The only way to realize money in your home should be to sell it for crying out loud!! Otherwise there is no money in your home!!

I do think in general we are in a bit of a housing bubble, but unfortunately, I do not think a crash like 2008-2009 bad will happen, rather a correction back to 2019 prices when the FED does QT and keeps raising rates. But 2019 prices were still insanely too high!!

But you know what and I say this as a home owner of 9 years who has no mortgage, I hope we have a crash worse than 2008 and a flat line of prices at the bottom after the crash for a long long long time afterwards like e very thing thought we would in 2011 though unfortunately they were wrong. I am sick of punishing our grand children and punishing savers who want to pay cash for a home because prices rise too fast because of lackluster down payments and dirt cheap interest rates and entitled people using their homes as piggy banks.

I hope it all blows up much worse than 2008. Nit just homes. But deflation in prices of automobiles and everything else and cash is king and gains lots of purchasing power!! I seriously hope and will be cheerleading if that happens!!

For anyone that says careful what you wish for, I have no mortgage nor any other forms of debt and $73K of cash in checking and savings account combined. So even if I lose my job, I will be ok as I can look for another and get by on a low wage job as I have no debt. And maybe my wish of being able to work with my friends again before my old company were beyond cruel to us in July 2017 during such a deflationary reset as in fact my 2 friends started there in October 2008 during last crash before I cam onboard in April 2012. As for my brother and his wife, his wife is a teacher and teacher jobs are generally safe through most conditions, so they will be fine. And my parents are retiring and have gotten conservative so stock market if it tanked in such situation will not hurt them much.

But enough is enough. For too long we have had a society in a everything bubble with outrageous inflation in some things especially now in more than just housing and education that I welcome a deflationary spiral and reset!!

And I have little money in stocks anyways except 401K, so I do not care if stocks take 25 years to recover as I am young and ways from retirement.

But like C2BP said it is time for everything bubble to deflate big time!!

Maybe then all the people who refuse to work will actually take jobs as all the white collar jobs at zombie companies disappear and make restaurants and oil refineries more productive. My god gas prices are beyond insane because refineries have worker shortages like almost everywhere else and cannot produce enough. Yes oil prices too are high, but they are not that high that gasoline should not be beyond record levels at $4.59 and rising despite oil being flat at $109 to $111 a barrel for 1 month now. Gasoline last time oil was this high was like $3.85 to $4.00
Life with blinders must be interesting.
Your hope for a real estate crash is so short sighted. You realize when that happens it means the rest of the economy will be in a bad place which affects you and your grandchildren. How are they going to afford the cheaper house if they lose their jobs?
You said you were young which means you don’t know jack. Funny how you say you won’t be affected, but what about all your friends. Bet they will suffer. Btw 70k in the bank isn’t squat.
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