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I hope this is reflective of a recovering economy. Yet, some in the industry believe that it more reflects the desire of many of get out of apartment buildings (where you have to share elevators with potentially infected people) and into single family homes.
I’m afraid of this as well. We’ve been in our house close to 30 years and have seen the bubble break twice on the market in that time. It’s coming, we all know it but when? And in the meantime people have to have somewhere to live.
No worries, my rentals will be right here waiting for people. LOL
I have a lot of people on my waiting list. Yes, I have a waiting list. I'm in the rental business and already see that there is a rental housing shortage.
For example, 2 months ago I rented out a 5 bedroom house at market rental price. Last month, I posted another 5 bedroom house in the same area for about $200/mo more and in 5 days I got 8 applications. Ended up renting to a family of federal workers because I figured they have job security.
I don't have control over how the economy will fair. I just know that my business is recession-proof. People don't just stop living in houses.
Yep, been buying up more rental properties now that the tax code has gotten better. By the time this year is over, I would have gone from 3 million in assets to 5 million, in real estate alone. This isn't even including my stocks.
I'm going to sell off my netflix stock and I'm thinking of using the gains to purchase an old run down apartment building, and maybe work with local colleges in letting students get to redesign and rebuild it for credit and work experience, and then just donate it to the city for a housing project for the poor.
skyrocketing asset prices should not be used as a sigh of a "healthy" economy. It's a sign their policies are causing inflation. Has the average wage gone up 24% to compensate? People are wage slaves because they keep lining the top 1% with money and they use that money to buy real estate and rent it out. The average person can't decently afford a house with the current house prices and wages. Then again people are equally irresponsible with their budgeting and finances... nobody is putting a gun to their heads and forcing them to pay these prices.. but like I said the top 1% literally has infinite money cheat codes so they can afford it.
We are not in the 1%. Far from it, actually. But we are in the owner class. And I can tell you the problem is a lot worse than what you think.
See, people keep pointing to the 1% as having cheat codes. But trust me, you don't need to be in the 1% to have the cheat codes.
When national data is used to convey broad trends in the housing market, it obscures divergent behavior for local markets and different price points within those markets.
Real estate is local down to the zip code, neighborhood within, block and in the case of condos, the building, elevation and exposure.
No one beat the drums louder during the housing bubble in the 2000’s Than the National Association of Realtors and it was among the last to acknowledge the severe downturn in values when the bubble popped.
Very generally speaking those with above average incomes have not been negatively impacted by Covid and are taking advantage of record low mortgage interest rates. The millennial age cohort are driving the condo market in most metro areas and retired people continue to pump some markets in Arizona.
Too many, including some real estate agents, rely on anecdotal information.
Then there’s the mortgage delinquency rate which rose from 3.2% in January to 7.8 % in May and then declined to 7.6% in June. The seriously delinquent ( 3 or more missed payments) was at the highest level in June since early 2011.
Federal, state, county and local moratoriums on foreclosures put further action on hold. Anyone’s guess how many will eventually proceed to foreclosure at some future date.
Bottom line, real estate is a very local market and always a mixed bag
This is why I think the predictions are wrong. There are some industries hit hard by the pandemic... but the vast majority of people I know were able to use it to save money and there is a massive pent up demand out there for real estate and other things.
Despite the unemployment numbers, the majority of employed people continue to be employed and paid. Jobs in tourism, hospitality, restaurants etc have been hard hit.
Many, many businesses have not been impacted by Covid and yet applied for and received Stimulus funds. The stronger a business’s balance sheet the more likely it was to be approved for stimulus funds.
64 million people are enrolled in SS and were never at risk of not being paid. Same for those who recieve pensions. Yet, they received the Stimulus bonus.
At the other end, a percentage of unemployed earned more with the $600/ week bump to unemployment benefits. Trump has made clear he is open to a $400 weekly bump going forward until year end. Of course, Congress has to approve funding and nothing is certain.
Additionally, Treasury is ready to make another one time stimulus payment just as soon as Congress acts.
Homes are selling like Crazy in Texas, I live near Austin and see homes selling quickly. In my neighborhood once it goes up its pending in a few days. We are seeing people from NYC, California, Washington state, Illinois.
I have been called by realtors to see if we are interested in selling one of our rentals.
Lockdowns are good for housing. People are not moving and changing jobs, so fewer houses on the market. Supply/demand. On the other hand, people are being protected from foreclosure, but eventually the back mortgage payments will come due. Something like 40% of Americans are behind on mortgage and rent no and it is getting worse with the elimination of the $600 unemployment additive. That could put a lot of people in the streets and a lot of houses on the market. Prices might tumble. It's all a big unknown.
There were no lockdowns in the US. Most people continued to be employed. Areas/ states substantially dependent on tourism are in a world of hurt.
There are now 1.87 million ( June) mortgages in serious delinquency , 3 or more months of missed payments. Last time it was this high was early 2011. The Federal/ state/ county/ local moratoriums on foreclosures means lenders are more open to tacking missed payments onto the back end of the note.
Delinquency rates increased the most in Nevada, NJ, NY, Hawaii and Florida. As a former resident of NJ, I continue to track home prices and property taxes. Mind blowing what is happening in some local markets in terms of positive home value appreciation, despite insanely high property taxes and the Corona.
Location: In the middle of nowhere... and enjoying it
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Quote:
Originally Posted by MetroWord
Um... home sales also spiked right before the housing market crashed back in 2009.
By the start of 2009 housing prices had dropped by over 50% from their peak in 2006, so the crash you refer to had already been underway for many many months.
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