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I want to be clear that I don't think that we're in a housing bubble here. One of the major difference is now versus 2007 and 2008 is that we've got people that are far more qualified to buy homes. The other issue is that the inventory is not been that accommodating. Think about the increase in Wood prices but we also have a slight uptick now and interest rates. Rates are still very good but I'd argue we don't have enough inventory prices will continue to go up. I think we could see increases slow but that doesn't mean that they're going to go down. So instead of maybe ten to fifteen percent increase annually say it goes down to three to five.
When I see that's a little bit odd is this hypocritical argument that we saw this big rush to the suburbs from cities and now all of a sudden we're going to have that Rush go back again. If that was true weird see rents going up and housing prices going back down. I'm not saying that renting or buying a house is easy but I can certainly say that renting is easier in terms of a short-term process. The qualifications to get a house are much higher than that of renting especially on Lower incomes.
Would the average homeowner that recently bought a house in the suburbs for whatever reasons actually wanted shoes to go back to work in the office fully knowing that they would have a much longer commute then before? Let's say somebody is now a half an hour extra away from their job and taking them now an hour each way. That's one hour of a day they're going to spend driving that they didn't have to do before. Then consider this an Aggregate and as more people get called back to the office the traffic gets worse. Gas prices are part of it and frankly I agree if we start to see $4 of gas again we're going to see people just staying at home especially on lower-incomes. The governor has considered the hybrid system for State executive branch employees and if implemented I think that's going to transcend into the private sector as well as with Academia.
Shopping is a solo activity? I grew up in the 1980s and 90s in the South Shore and we were washing malls all over the place. I'm not saying they were perfect but there was a greater sense of community when people did do more shopping in person. And then your downtown shops and restaurants certainly did appreciate more dollars and as we continue to shop online that gets bypassed. Much of what we've had in terms of social interaction in the past has been replaced. How many people really do need to go to City and town halls today vs the past? How many bills must be paid in person? Email as replace regular mail. I can go days without receiving a piece of mail it doesn't bother me one bit. The vast majority of my bills are automatic. Certainly the argument could be made that R&D can be performed better in person but at the same point m&a has also replaced much of R&D. Much of the entire Tech Industries based off of the Outsourcing of the complete supply chain.
Gas prices have skyrocketed since the Democrats took over the White House.
The administration in charge has no control over gas prices. Demand for gasoline has risen as people return to work. Further, OPEC hasn't reopened the tap in order to drive prices up.
And let's compare just for kicks as I have a spreadsheet of the price of gas I've bought since 2011:
peak under Obama 4/2012 $3.90
lowest under Obama 12/2015 $1.75
election day 2016 $2.12
peak under Trump 8/2018 $2.99
lowest under Trump 4/2020 $1.63 beginning of pandemic
election day 2020 $1.72
Inauguration day 2021 $2.23
Yesterday $2.55.
Price of gas is 15% below the peak under the previous administration. It's easy to point at something simple, global economics is harder to understand/blame.
The administration in charge has no control over gas prices. Demand for gasoline has risen as people return to work. Further, OPEC hasn't reopened the tap in order to drive prices up.
The oil rally is due to the dollar taking a dump, which is directly related to the stimuluses (and not actually paying for it). Perhaps (anticipation of) the second one is what is driving oil up as people look to assets that aren't the dollar. Same thing happened with Crypto.
My wife and I closed on a 15-year refi last April. I just checked our bank's website and current 15-year rates are at 2.25%, same as we got a year ago, and their 30-year fixed is at 2.875%. I can't imagine rates deterring any purchases in the foreseeable future.
Ironically, what could end up happening is not that Boston Real Estate crashes.. but the cheaper parts of the country skyrocket.
Honestly, I think it's already happening, at least in CLE. In less than a year here (and let's face it, social interactions are WAY limited) I've met at least 2 dozen folks relocating from HCOL cities (East Coast, Seattle, SFO, LA) to here....drawn in no small measure by the real estate prices.
I just purchased a beautifully maintained c1928 Brick Tudor, 3k sq feet, 4 beds, 3.5 baths, wonderful condition (all original woodwork and HWF intact, the kitchen is maybe 15 years old, baths in GREAT condition), quiet street on 1/3 an acre.
In a town similar to Newton...for
(sit down)
$330k.
My skills are transferrable anywhere. I might take a 10-20% pay cut, but with the LCOL, I come out WAY ahead. It's already started to happen (and will continue, I think)
"A new report shows that the number of international students studying in the United States fell 18 percent last year, according to student visa records. Even worse, with US consulates worldwide shuttered by the pandemic, the number of visas issued for newly enrolled international students dropped a whopping 72 percent."
So yeah they are coming back but it's way less. Will this change? Well are they taking gap years, going to another institution, going to a US institution domestically or taking classes online?
Work already is done overseas. Have you used tech support in the past ten years or dealt with a chat not? Lookup Fiverr and Upwork. Heck DaVinci machines lost their patent. If you think remote surgery can't be done the other way you are mistaken. We already have medical tourism.
Quote:
Originally Posted by TechieTechie
Honestly, I think it's already happening, at least in CLE. In less than a year here (and let's face it, social interactions are WAY limited) I've met at least 2 dozen folks relocating from HCOL cities (East Coast, Seattle, SFO, LA) to here....drawn in no small measure by the real estate prices.
I just purchased a beautifully maintained c1928 Brick Tudor, 3k sq feet, 4 beds, 3.5 baths, wonderful condition (all original woodwork and HWF intact, the kitchen is maybe 15 years old, baths in GREAT condition), quiet street on 1/3 an acre.
In a town similar to Newton...for
(sit down)
$330k.
My skills are transferrable anywhere. I might take a 10-20% pay cut, but with the LCOL, I come out WAY ahead. It's already started to happen (and will continue, I think)
You live in Cleveland ?
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