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Old 03-23-2022, 10:27 AM
 
Location: Middle of the valley
48,518 posts, read 34,807,002 times
Reputation: 73728

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Quote:
Originally Posted by Fedupwiththis View Post
Pretty sure that’s not true. Housing starts have been steadily rising every year. They haven’t been keeping up with population but then not all the population can afford a home either way. The “low supply” does not justify the insane increase in housing prices the last 18 months. Once demand starts to dry up investors will unload properties, people will sit on the sidelines and wait, mortgages are now 5%… theres a bubble… the fact so many people are blind to it makes me believe even more that it could pop at any moment. Again, it doesn’t have to look like 2008, it can be a different type of bubble that pops for a different type of reason.
https://www.housingwire.com/articles...rket-recovery/
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Old 03-23-2022, 12:17 PM
 
Location: South Tampa, Maui, Paris
4,474 posts, read 3,842,069 times
Reputation: 5322
More than $1,000 per square foot for a 1947 1 bed 1 bath shotgun shack on a busy street that routinely floods during rainstorms and is often gridlocked with traffic.

Seems like a pretty bubbly market to me, at least in Tampa, FL.

https://www.realtor.com/realestatean...9_M62733-04289
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Old 03-23-2022, 01:18 PM
 
124 posts, read 103,383 times
Reputation: 381
Quote:
Originally Posted by sinatras View Post
More than $1,000 per square foot for a 1947 1 bed 1 bath shotgun shack on a busy street that routinely floods during rainstorms and is often gridlocked with traffic.

Seems like a pretty bubbly market to me, at least in Tampa, FL.

https://www.realtor.com/realestatean...9_M62733-04289
Looks like the ole shotgun shack has a healthy case of gentrification.

https://www.zillow.com/homedetails/3...69077925_zpid/
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Old 03-23-2022, 01:22 PM
 
Location: TN/NC
35,057 posts, read 31,258,424 times
Reputation: 47513
Quote:
Originally Posted by Fedupwiththis View Post
Pretty sure that’s not true. Housing starts have been steadily rising every year. They haven’t been keeping up with population but then not all the population can afford a home either way. The “low supply” does not justify the insane increase in housing prices the last 18 months. Once demand starts to dry up investors will unload properties, people will sit on the sidelines and wait, mortgages are now 5%… theres a bubble… the fact so many people are blind to it makes me believe even more that it could pop at any moment. Again, it doesn’t have to look like 2008, it can be a different type of bubble that pops for a different type of reason.
People have to live somewhere. Housing starts have been way below what is needed since the Great Recession. Millennials are in their prime home buying years, and now Generation Z are also entering the market. There are simply too many people chasing too few properties.

Also, what is being built are largely higher end properties. I make six figures in a low cost of living area. I'd like to have something in the 1800-2000 sq. ft range, but pretty much everything being built (and around here, building basically dried up from the Great Recession until the last couple of years) is bigger than that, and starts well over $300k. That would be a stretch for me.
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Old 03-23-2022, 01:45 PM
 
Location: Florida & Arizona
5,975 posts, read 7,365,693 times
Reputation: 7591
Demand isn't going to decrease significantly. The increase in mortgage rates is going to trim off the "edges" of the potential buyers, or force them lower down the chain as far as purchasing power, but they're still capitalized and ready to buy.

The factor that's driving this whole situation is inventory. As long as it remains well below meeting the market's demand, prices will remain high and sales will be aggressive.

RM
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Old 03-23-2022, 04:03 PM
 
Location: Cary, NC
43,265 posts, read 77,043,330 times
Reputation: 45612
Quote:
Originally Posted by MortonR View Post
Demand isn't going to decrease significantly. The increase in mortgage rates is going to trim off the "edges" of the potential buyers, or force them lower down the chain as far as purchasing power, but they're still capitalized and ready to buy.

The factor that's driving this whole situation is inventory. As long as it remains well below meeting the market's demand, prices will remain high and sales will be aggressive.

RM
Absolutely right on all points.
People can always buy down, if they can find something to buy.
The 1st timers will bear the brunt if many people decide to cut their purchase limit by 5% or 10%. People trying to grab the bottom rungs on the homeownership ladder will face even more competition.
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Old 03-23-2022, 08:34 PM
 
Location: PNW
7,478 posts, read 3,219,325 times
Reputation: 10633
Quote:
Originally Posted by MikeJaquish View Post
Absolutely right on all points.
People can always buy down, if they can find something to buy.
That's what's happened in NYC and CA for decades. High prices shift the perspective.
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Old 03-24-2022, 08:33 AM
 
Location: Ottawa, IL ➜ Tucson, AZ ➜ Laramie, WY
262 posts, read 606,663 times
Reputation: 726
Quote:
Originally Posted by MikeJaquish View Post
Absolutely right on all points.
People can always buy down, if they can find something to buy.
The 1st timers will bear the brunt if many people decide to cut their purchase limit by 5% or 10%. People trying to grab the bottom rungs on the homeownership ladder will face even more competition.
This still doesn't explain why this wasn't the issue it is today in 2017, 2018, 2019, and 2020. I still don't understand why prices doubled suddenly following 2020, and how these new prices are sustainable over the longer term.
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Old 03-24-2022, 10:59 AM
 
8,005 posts, read 7,211,328 times
Reputation: 18170
Quote:
Originally Posted by fr8train View Post
This still doesn't explain why this wasn't the issue it is today in 2017, 2018, 2019, and 2020. I still don't understand why prices doubled suddenly following 2020, and how these new prices are sustainable over the longer term.
In my market inventory has been on a steady decline since 2006 when we had around 1350 active listings. By January 2017 we had dropped to 279 residential listings. That number has continued to decline to today's paltry 50 total residential properties offered. Demand is similar to then and frustrated buyers are knowingly overpaying just to get into something. During the preceding years the market was getting more and more competitive with accelerating prices but once the inventory declined to around a one month supply in early 2020, it just exploded. Apparently that supply/demand dynamic we studied in economics is a real thing.
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Old 03-24-2022, 12:42 PM
 
Location: PNW
7,478 posts, read 3,219,325 times
Reputation: 10633
Quote:
Originally Posted by fr8train View Post
This still doesn't explain why this wasn't the issue it is today in 2017, 2018, 2019, and 2020. I still don't understand why prices doubled suddenly following 2020, and how these new prices are sustainable over the longer term.

Being in your home 24/7 you are more likely to have criticisms of your space. It's absolutely huge change in behavior of a large number of people all at once.
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