Houston Home Sales and Prices Surge! (Canyon, Cinco Ranch: apartments, rentals, buying)

[Sammysh]

That is correct. FOR NOW. What I'm saying is that this is not sustainable given the economic situation in the area. This is just like you said a short term consequence of the pent up demand during COVID. When all that clears and people run out of mortgage forbearance and other types of stimulus, it will go down in flames. Maybe not like in 2009, but it will still go down. Even in 2009, it took over a year for the RE to crash. In 2008 there were still people doing the same type of analysis that you are doing right now.

[lipbalm]

Originally Posted by Sammysh

That is correct. FOR NOW. What I'm saying is that this is not sustainable given the economic situation in the area. This is just like you said a short term consequence of the pent up demand during COVID. When all that clears and people run out of mortgage forbearance and other types of stimulus, it will go down in flames. Maybe not like in 2009, but it will still go down. Even in 2009, it took over a year for the RE to crash. In 2008 there were still people doing the same type of analysis that you are doing right now.

I hear the high end of the market all across the country is red hot. People fleeing high tax and now socially unstable areas like NYC, California, Seattle are fleeing in droves to less populous areas like the suburbs and even rural. For example in Coeur D'Lane (not sure the spelling) Idaho multi million properties are not staying long on the market due to all the rich Californians ditching the state and escaping. But I think you are right that in the long term for us "normal" people things can get very bad if the jobs don't come back and soon.

[DabOnEm]

Originally Posted by lipbalm

I hear the high end of the market all across the country is red hot. People fleeing high tax and now socially unstable areas like NYC, California, Seattle are fleeing in droves to less populous areas like the suburbs and even rural. For example in Coeur D'Lane (not sure the spelling) Idaho multi million properties are not staying long on the market due to all the rich Californians ditching the state and escaping. But I think you are right that in the long term for us "normal" people things can get very bad if the jobs don't come back and soon.

Yeah this is what is really happening. There are a few dense and liberal cities which are seeing an exodus if you look at their housing or rental market. San Francisco, NYC, Seattle, Portland, some parts of LA, and the rich enclaves near them (Berkeley Hills near SF, etc.). I've heard directly people are tired of the taxes, the homeless, and they can work from anywhere right now. SF's condo and apartment market has turned into a buyers market. People are getting 15-20% off their rent in some highrise buildings...

People want lower taxes and more freedom. Places like Texas, Arizona, Nevada, Idaho, Utah, etc., are going to continue to explode. I know myself I've started looking at the Hill Country for some land...

[clerymary]

Originally Posted by DabOnEm

Yeah this is what is really happening. There are a few dense and liberal cities which are seeing an exodus if you look at their housing or rental market. San Francisco, NYC, Seattle, Portland, some parts of LA, and the rich enclaves near them (Berkeley Hills near SF, etc.). I've heard directly people are tired of the taxes, the homeless, and they can work from anywhere right now. SF's condo and apartment market has turned into a buyers market. People are getting 15-20% off their rent in some highrise buildings...

People want lower taxes and more freedom. Places like Texas, Arizona, Nevada, Idaho, Utah, etc., are going to continue to explode. I know myself I've started looking at the Hill Country for some land...

I'm sorry to break it to you, but TX is not a low tax state. I know you were brainwashed into thinking that, but compared to CA, the property taxes here are just ridiculous. You don't pay income tax in TX but you pay through the nose in property taxes. And the sales tax is about the same. People running away from the high cost of real estate in those areas it's a real thing, but running from taxes, that's not it.

[DabOnEm]

Originally Posted by clerymary

I'm sorry to break it to you, but TX is not a low tax state. I know you were brainwashed into thinking that, but compared to CA, the property taxes here are just ridiculous. You don't pay income tax in TX but you pay through the nose in property taxes. And the sales tax is about the same. People running away from the high cost of real estate in those areas it's a real thing, but running from taxes, that's not it.

I'm a native Texan and pay California taxes now. Overall CA is more expensive, including income taxes, property taxes (only good in CA if you bought a long time ago and rates are locked in unlike TX), and investment taxes.

[clerymary]

Originally Posted by DabOnEm

I'm a native Texan and pay California taxes now. Overall CA is more expensive, including income taxes, property taxes (only good in CA if you bought a long time ago and rates are locked in unlike TX), and investment taxes.

You pay more taxes because the real estate prices are higher in CA. That's a different factor that is so for many reasons. You also probably make more money in CA than TX, which again would be a different factor, unrelated to the tax burden as it is commonly thought of.

But dollar for dollar, the tax burden in CA is similar to that in TX, if you consider identical income and property prices scenarios. You are much better off in CA at low income levels and much better in TX at high income levels, due to the way the 2 states structure their taxes. But for a regular family, taking the price of real estate out of the equation and considering identical incomes and property values, the two states are very similar.

[dd1153]

Originally Posted by Sammysh

That is correct. FOR NOW. What I'm saying is that this is not sustainable given the economic situation in the area. This is just like you said a short term consequence of the pent up demand during COVID. When all that clears and people run out of mortgage forbearance and other types of stimulus, it will go down in flames. Maybe not like in 2009, but it will still go down. Even in 2009, it took over a year for the RE to crash. In 2008 there were still people doing the same type of analysis that you are doing right now.

Hard to predict the future.. “when all this clears” Dow could be at 45k, rates at 7% and average sale price up 20% from today. So a 5% drop in price would still result in 15% more purchase price and 30-40% less purchasing power on rate.

Houston is booming .. and leading the country in building start permits. Hard to deny the facts.

[clerymary]

Originally Posted by dd1153

Hard to predict the future.. “when all this clears” Dow could be at 45k, rates at 7% and average sale price up 20% from today. So a 5% drop in price would still result in 15% more purchase price and 30-40% less purchasing power on rate.

Houston is booming .. and leading the country in building start permits. Hard to deny the facts.

You realize that what you just stated is an argument for pricing going down, not up. If the number of building permits is through the roof, that means an increase of supply, which means a decrease of prices in the future! Prices would go up if the reverse was to be true!

[Sammysh]

Originally Posted by clerymary

You realize that what you just stated is an argument for pricing going down, not up. If the number of building permits is through the roof, that means an increase of supply, which means a decrease of prices in the future! Prices would go up if the reverse was to be true!

Was literally going to say the same thing.


It's not easy to understand economics and it's even harder to understand how expectations and predictions work. Most people think from the perspective of the past so they tend to project what happened in the recent past or what is happening currently in the future. But of course that's the first lesson in finance, that past histories are not indicative of the future.


I live here so I hope Houston prospers. And it has a good chance because it is pretty well diversified. But there is still a huge chunk of the local economy that is relying on energy and that has the potential of becoming the next Detroit when that sector of the economy collapses. People say I'm crazy but there are too many flashing signs. Shale oil is simply not competitive enough and a price war between Russia and the Saudis does not help one bit. Nevermind the Covid-related decrease in demand. We're not looking pretty at the moment

[dd1153]

Originally Posted by clerymary

You realize that what you just stated is an argument for pricing going down, not up. If the number of building permits is through the roof, that means an increase of supply, which means a decrease of prices in the future! Prices would go up if the reverse was to be true!

Exactly.. my point is if prices rise 20% from today and values pull back 5% are you really getting a deal? Everyone wants to time the market and rarely, very rarely does it work. Market isn’t collapsing. Every year I see the same doom & gloom posts on here. Guess what.. prices go up & market doesn’t fall. It’s called inflation.