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Housing market theories

Anyone seeing any decline or leveling off in the market?

My house in CA sold and everything looks relatively appealing out here. Trying to be patient and get acclimated to the new market I am in.

I did make a lowball cash offer on a wreck of a house 4 doors down from the place I am renting. Had a handwritten fsbo sign and was not on MLS
 
I've got some friends that have been trying to sell their house in nowhere Oklahoma. Barely a nibble in 6 months. I guess the hedge funds aren't buying every house for over asking price unseen.
 
My agent said things are slowing, instead of 10 lookers and 5 offers on the first week of listing it's 5 lookers and 2-3 offers for anything below 500k-600k. My friend about a mile down the road is putting his house up this week for 1.1 mill, he has 10 acres and 3k house, mine is 3 acres and 3k feet but a nicer house than his. So I guess we will see how the ~1 million market is holding up. I hope he kills it so I can put mine up.
 
Still fast and furious here. More inventory on the market now though so it appears a bit slower. We just put an offer in and got accepted on 20 acres of forest land for $289,900. We were the first offer they got after 4 days, but were like the 12th person who it was showed to. Feasibility study this week and assuming it all checks out we have our slice of paradise to start building on.
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We bought in Tucson in 2011. Moved in a couple years later. We were on the outskirts but since purchase a Walmart, 2 charter schools, and a giant new medical facility popped up within a mile of our place. Prices have been going bonkers in our hood due to most everyone having a near acre of private backyards. Trying to pick up a house in TN now and people keep swiping them out from under us with cash offers. I'm tempted to just rent in the town we want and sell our home in AZ to be able to compete with similar cash offers...
 
Slowing where we are lookong
 
Norm said:
My agent said things are slowing, instead of 10 lookers and 5 offers on the first week of listing it's 5 lookers and 2-3 offers for anything below 500k-600k. My friend about a mile down the road is putting his house up this week for 1.1 mill, he has 10 acres and 3k house, mine is 3 acres and 3k feet but a nicer house than his. So I guess we will see how the ~1 million market is holding up. I hope he kills it so I can put mine up.
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i think that you are going to slow in the typical price range for middle class people. the increase in interest rate will give them less purchasing power and also cause them to pause before jumping in.

cheap stuff will still move quick, the upper middle class i dont think are going to slow much until the interest rates get up in 6.5-7% range.
 
JR4X said:
Looks to me like we’re past the peak but I’m biased because I’m waiting for the dip
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From what I'm seeing and reading I dont think there will be much of a dip. We are balls to the wall in my industry (precast) and dont see any signs of slowing down. We were hoping for the same thing. Buying is slowing with interest rates rising, but new building costs are steady as they realized people will pay it. Pricing for the market may level off, but I dont think we will see a drop. We're not counting on one anyways with what we see on our end.
 
Alpine4x4 said:
From what I'm seeing and reading I dont think there will be much of a dip. We are balls to the wall in my industry (precast) and dont see any signs of slowing down. We were hoping for the same thing. Buying is slowing with interest rates rising, but new building costs are steady as they realized people will pay it. Pricing for the market may level off, but I dont think we will see a drop. We're not counting on one anyways with what we see on our end.
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I'm old and been through a few booms, they are always followed by a bust. We are at 2x normal income to house cost, either we all double our salaries or this thing goes bust soon. I know where I am placing my bet. Everyone always says it's different this time, well it's not. Once folks get tired of paying a mortgage that's 2x what the property is worth, people will start walking away.
 
My theory is that a large percentage of the buyers are doing so because houses are an appreciating asset. The moment real estate becomes a depreciating asset, many will bail, starting a race to the bottom. This doesn't take into account the economic troubles we're heading towards at a great speed.
 
Alpine4x4 said:
From what I'm seeing and reading I dont think there will be much of a dip. We are balls to the wall in my industry (precast) and dont see any signs of slowing down. We were hoping for the same thing. Buying is slowing with interest rates rising, but new building costs are steady as they realized people will pay it. Pricing for the market may level off, but I dont think we will see a drop. We're not counting on one anyways with what we see on our end.
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Natural gas is $9.00 an MCF and diesel is $5.60 a gallon right now. If you don’t think that’s started the first wave of a ripple I think you’re delusional. Commodity prices are headed up not down. The cost to transport your finished product has more than doubled. I don’t believe the market will bear that with no consequence. Most companies are just now processing the first full month AP financial impacts on transportation.

You haven’t seen the impact of that yet, but you aren’t to far away from seeing it. By the end of July after second quarter financial’s are out I bet certain sector’s are in full blown panic.
 
Norm said:
I'm old and been through a few booms, they are always followed by a bust. We are at 2x normal income to house cost, either we all double our salaries or this thing goes bust soon. I know where I am placing my bet. Everyone always says it's different this time, well it's not. Once folks get tired of paying a mortgage that's 2x what the property is worth, people will start walking away.
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I hope you are right, it would help my plans out greatly. Theres more regulation in place now on mortgages and theres not the population of subprime mortgages out there as there was in 2008. Its a different scenario with regards to recession. We're already seeing the hold on investment by developers and wall street. People are expecting this to crash and playing closer to the vest. Multiple industries are paying their employees more to combat the massive inflation right now. Everyone I have spoken with has received substantial raises including myself and my wife. The ones who are not making more are those on fixed incomes, a segment this inflation is really hurting. Minimum wage is almost $15/hr where I am at and you cant hire anyone for under $15/hr. Unless that floor drops, I fear this market increase is here to stay.
Mikel said:
My theory is that a large percentage of the buyers are doing so because houses are an appreciating asset. The moment real estate becomes a depreciating asset, many will bail, starting a race to the bottom. This doesn't take into account the economic troubles we're heading towards at a great speed.
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Housing is one of the few things you can always count on increasing in value. It may dip, but it will recover. Even after the big recession in 2008 housing has rebounded and there is no chance current prices drop to or below what they hit in 2008.
 
JR4X said:
Natural gas is $9.00 an MCF and diesel is $5.60 a gallon right now. If you don’t think that’s started the first wave of a ripple I think you’re delusional. Commodity prices are headed up not down. The cost to transport your finished product has more than doubled. I don’t believe the market will bear that with no consequence. Most companies are just now processing the first full month AP financial impacts on transportation.

You haven’t seen the impact of that yet, but you aren’t to far away from seeing it. By the end of July after second quarter financial’s are out I bet certain sector’s are in full blown panic.
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Our prices have raised to accommodate that increase and we are still booking plenty of work. I dont know where all this money is coming from, but we have doubled and tripled prices in bid to keep bidding and maybe pick up a few jobs at massive profit. What is happening is we are getting more jobs than we can handle even with the price increases, mostly due to availability and timeframes. I'd like to think it has to stop at some point, indicators say it should, but as of right now the industry is just chugging along.
 
Mikel said:
My theory is that a large percentage of the buyers are doing so because houses are an appreciating asset. The moment real estate becomes a depreciating asset, many will bail, starting a race to the bottom. This doesn't take into account the economic troubles we're heading towards at a great speed.
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This crash, when it does come, will be harder than all of the previous ones. A great number of properties are owned by corporations rather than people. What happens when those houses get dumped on an already saturated market? Supply and demand, we will see an inverse of the current trend; the supply will be 5x (or more) what the demand is, and prices will drop below 2008 era crash.

Unless, for some reason the corps hold onto their real estate assets, which may happen as often companies plan for the long term.

IMO, it's all designed to make the housing become "Socialized." I foresee gov bailouts for larger corps like Blackrock that bought up all these homes. If you look, you'll see social media is already starting to boost posts about "housing being a basic human right." "Healthcare is a right, Housing is a right, Education is a right, Food is a right"; Socialism is being presented as a "right" and the sheeple are buying it. The rights enumerated in the U.S. Constitution will be eroded, taxed, licensed and otherwise limited, and these made-up rights will be used to enslave the population.
 
There's no mystery here.

Huge lack of inventory in many markets. For years population has outpaced new builds. This isn't a overnight issue. It won't be solved by rates going up or down. We are approaching a generational peak of new home buyers. Basically there wasn't enough houses to start, and demand is still rising.

Some areas get popular. The area gets expensive. Locals flee. Cycle starts over somewhere new. This will happen until the population stops expanding. Until then the wealthiest will always live in the most desirable areas, and the poors in the shitholes. With a whole spectrum in between.

Right now you can absolutely move and change your families stars. Our area is inundated with people fleeing wildly expensive areas. They roll in with deep pockets. Prices are wild. Now we're the "expensive area". The freaking Kardashians visit, and I have famous people wading in the stream next to me in what was the middle of nowhere just 3 years ago. Friends just went from scraping by to solid middle class in one move. Sold out here, used the proceeds to pay cash in TN, both got higher paying jobs, in an area with a lower cost of living. Their kids will grow up middle class rich.

FYI we are going to see some major changes in housing in the next couple of years. I can easily envision in my lifetime it's going to be like buying or leasing a car.


3 real things pointing that way.

Current class actions against national real estate agencies. Plaintiffs allege that the seller paying for the buyers representation amounts to price fixing. The likely outcome could be that sellers are forced to pay for their representation out of pocket. That is a cash cost that can't be financed. If your rep is making $500, and theirs is making $5000? The best agents will only rep sellers, and the buyers agents will need to turn volume as quickly as possible. Perfect for sellers and investors who can afford great reps or paying over market value.

Huge rise in both traditional investing companies and new crowdfunded investing companies buying all forms of residential real estate. I think some of that is driven by inflation fears, but it's big a paradigm shift in who you are competing against in a market.

Current developer trends in high demand areas. Buyer forgoes all representation, negotiation, and recourse. You want a new house in any of the 3-4 new "hot" developments? You go on a list. Your # comes up, You want this house or not? No? Next! Don't like it? Get on the list with the other developer who controls the other 3-4 next level down developments. You play nice or maybe you're off the list for all the future developments as well.
 
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MChat said:
This crash, when it does come, will be harder than all of the previous ones. A great number of properties are owned by corporations rather than people. What happens when those houses get dumped on an already saturated market? Supply and demand, we will see an inverse of the current trend; the supply will be 5x (or more) what the demand is, and prices will drop below 2008 era crash.

Unless, for some reason the corps hold onto their real estate assets, which may happen as often companies plan for the long term.

IMO, it's all designed to make the housing become "Socialized." I foresee gov bailouts for larger corps like Blackrock that bought up all these homes. If you look, you'll see social media is already starting to boost posts about "housing being a basic human right." "Healthcare is a right, Housing is a right, Education is a right, Food is a right"; Socialism is being presented as a "right" and the sheeple are buying it. The rights enumerated in the U.S. Constitution will be eroded, taxed, licensed and otherwise limited, and these made-up rights will be used to enslave the population.
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What is happening now is the result of shitty federal policies. When this implodes, more shitty policies will be instituted to kick the can down the road, which will prevent the rot from being purged and will make things even worse next time we get into trouble. Both parties have been doing this for over two decades.
 
If you think the corporations will dump all their properties into an already- saturated market, you are mistaken. They will meter them out like they did last time to minimize their losses. Plus, I don't think they want to encourage home ownership as opposed to expanding the rental class.
 
Mikel said:
What is happening now is the result of shitty federal policies. When this implodes, more shitty policies will be instituted to kick the can down the road, which will prevent the rot from being purged and will make things even worse next time we get into trouble. Both parties have been doing this for over two decades.
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Just because all previous crashes have been caused by govt policies, it doesn’t mean this one will be. Right? :flipoff2:
 
Alpine4x4 said:
From what I'm seeing and reading I dont think there will be much of a dip. We are balls to the wall in my industry (precast) and dont see any signs of slowing down. We were hoping for the same thing. Buying is slowing with interest rates rising, but new building costs are steady as they realized people will pay it. Pricing for the market may level off, but I dont think we will see a drop. We're not counting on one anyways with what we see on our end.
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I expect the ‘leveling off’ to be reported as a dip by those who have been saying ‘it is going to crash’ for the past 6 years. Shocking, but they won’t be in a position to benefit from this collapse they saw coming six years ago.
 
Houses in my neighborhood earlier this spring we're selling in less than 3 days for well over asking and waiving all contingencies. There's 3 houses that went on the market and have been for sale for 42 days with several price reductions. Two more houses are about to hit the market this week. I'm pretty interested in what will happen with them.
 
Maybe ever so slightly slowing in my hood. I bought here around 3 years ago with homes starting at 500K but an average price of a little over 600K. In the last year there have been 5 or 6 sold for 1M or better and sold quick. The slowing part is a house just up the road went for a **** hair under 1M and it took a whole 10 days for it to sell. I'm pretty tempted to take profit at this time but this is kinda our dream home so I guess we will keep it.
 
This is up the road from me, I thought cool I could sleep great in there! Basement walks out to a healthy brook. two "rooms" on first floor and a bathroom plus a ladder to the loft bedroom. 60k :laughing: F41C4BC3-AAB8-4657-9A6F-AA9A6F6DB8AA.jpeg F2B453B4-9B95-4E2A-A285-C7D69F63D452.jpeg
Looks about 15x30
 
Alpine4x4 said:
From what I'm seeing and reading I dont think there will be much of a dip. We are balls to the wall in my industry (precast) and dont see any signs of slowing down. We were hoping for the same thing. Buying is slowing with interest rates rising, but new building costs are steady as they realized people will pay it. Pricing for the market may level off, but I dont think we will see a drop. We're not counting on one anyways with what we see on our end.
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I have noticed a HUGE slowdown in 2nd and vacation homes. HUGE. The moment it went from anyone with good credit and a down payment for get 3% interest. Suddenly when interest rates went north of 5% minimum we went from 20 offers in 4 days with 20%+ escalation to no offerers in 3 weeks.
 
Anything priced 'reasonably(still stupid high)' is still selling within a week, some stuff sits but its priced high and extremely outdated or something else odd about the property.
 
Sold my place in under 24 hours. Wasn't even officially listed yet.
Buyer offered 5k over asking and covering all fees, closing, broker fees, etc. (Around 25k)
 
Thefishguy77 said:
I have noticed a HUGE slowdown in 2nd and vacation homes. HUGE. The moment it went from anyone with good credit and a down payment for get 3% interest. Suddenly when interest rates went north of 5% minimum we went from 20 offers in 4 days with 20%+ escalation to no offerers in 3 weeks.
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I had been wondering how much might be driven by 2nd & 3rd property purchases at seriously low rates. Because those folks with money would drive the whole market up to where people who needed a first house have to bear them out.
 
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