Real-Estate Bubble Popping?

[My94GT]

Various states are seeing a cool off. TX is one of the top states seeing a large drop. My opinion based on watching the housing market regularly for the last three years is some hot states like TX, FL, AZ will see a larger cooling period as they were over saturated with influx of people moving in from out of state and it hyper inflated sales prices for current home and new builds.

Meanwhile the state I’m in MD has only seen a 2% drop in new home sales and many contractors are still booked into 2023 already. Prices are holding steady even if the buyer pool is downsizing there is still a large volume of people to purchase and not enough influx of new homes to put pace the demand.


I’m personally hoping to see it cool a bit so materials pricing drops as I’m a couple weeks away from having a build permit and dealing with a custom builder so no locked in pricing lol

 

[BlueSnake01]

My home dropped already 13k~ in the past 30 days according to Zillow.

I was hoping for at least 2 years before it really dropped so I can purchase another one

 

[Blk04L]

IMO there's a correction due to interest rates hurting the average buyer-with money or not. Some areas will be "corrected" more than others. The values got too inflated in a short time span. There will be a few buyers in the red who bought late but a majority will still have a good amount of equity.

There's only so many cash buyers out there and the rest of the people even with healthy down payments/income will only stomach so much until they pull back on buying a primary home or secondary home.

Interesting thing around here is material, labor and inspection times are still out of whack.
Concrete? Got to know someone to get it on time/got to be a big buyer.
Certain roofing material? Good luck, amazon warehouse in PSL bought all of the metal for that type of roof.
Inspections with the city? No guarantee they show up/they want the builders to pay OT to the inspectors to show up on time.

Commercial side is still nuts on ETAs and pricing.

 

[SID297]

Inventory is still a major issue here. There's just not much on the market. If the economy really tanks I look for condo prices to drop significantly. Most of the people moving here are retirees, as long as they can sell their houses in other markets I don't look for that to change.

 

[black4vcobra]

Inventory is still a major issue here. There's just not much on the market. If the economy really tanks I look for condo prices to drop significantly. Most of the people moving here are retirees, as long as they can sell their houses in other markets I don't look for that to change.

Same here. I saw a recent story that said the county I'm in (Dane) underbuilt by 11,000 housing units from 2006-2017. The county is also growing faster than pretty much anywhere in the Midwest.

I find it nuts that a decent 800 sq ft apartment is going for a minimum of $2k right now and could easily be $2700 for better locations.

We just paid far more for a house than I ever thought I would but we relocated into a community that is in high demand and an Amazon distribution facility has been approved there and will bring 1500 jobs to a village with a population of 7300. I'm not the slightest bit worried that the market will crash in my area.

 

[TerminatoRS]

I find it nuts that a decent 800 sq ft apartment is going for a minimum of $2k right now and could easily be $2700 for better locations.

For reference and for shits and grins, when I rented a one bedroom out there on the SW side (Waterford Circle), I paid $785/month rent. This was in ~2014. I always figured part of the higher rents were due to students and Epic employees.

A shanty two houses down from me just went up for sale. 15xx sq ft ranch built in the late 60s. Partially updated. Good starter house IMO. Asking $329,900. That's ridiculous for that house around here. And they've got an offer! Fingers crossed a burner who likes to drink moves in. I like fun neighbors. haha

Rewinding for the sake of local comparison, four years ago I paid $335k for 2500sq ft, completely updated (inside and out including roof, siding, windows, gutters, garage doors...) two stories, 4 bdrm, 2.5 baths (upstairs are both dual vanity) and 3.75 car climate controlled garage. Really puts things into perspective when you've got places right around you going for insane prices. Also makes me happy we bought when we did. lol

 

[decipha]

The real estate fluctuations in the housing market is due to the two completely opposing consumers.

You have tycoons and developers that use real estate as investments with multiple properties they buy and sell. In these cases real estate is an investment and ups and downs affect the pocket book.

Then you have the average buyer and unlikely occasional seller that is looking for single housing only. In this case a home is not an investment its a neccessity that cannot gain or loose value tangibly since its value is nonusable. Even if it were to proposely double its value overnight it would be of no use to that consumer since they couldnt tap in to any of that. For example I paid 165k for my house (pre-foreclosure take over) more than a decade ago. Im in the process of putting 125k in on renovations. House is expected to appraise for 800k but its of no use to me since I cant use any of that. If I were to sell Id loose my ass on taxes and it would cost me at least that much to find something comparable so its useless.

The fluctuations come in the market when more investors sell while single consumers need housing and have no other option than to buy or be homeless.

Im big in to real estate and I cant seem to pass up a deal. Last deal I seen was over 2 years ago now. The real estate market in the greater new orleans area has been dead since.

Staging a home is for ignorant buyers. When I see a house I want to see all the walls and floors unobstructed to evaluate actual condition.

The majority of real estate agents are shit.
Biggest problem with agents are they fail to give accurate descriptions and lack pertinent info.
Agents that use the MLS only are useless.
If an agent doesnt have a book full of investors and buyers they are useless.
If an agent isnt closing on at least 4 homes a week they aren't worth a damn.

If an agent doesnt list the actual lot sq ft, rear yard access, flood zone, doesnt include half baths, the age of roof ac and major appliances they are useless.

And for the love of god the biggest problem with most agents IME is they do not include the cost of the land.

Some idiotic agent sold an inherited 4bath 2br 1500 sq ft home in the greater new orleans area for 150k. Idiot failed to realize the acerage it was on was worth 3 times that. The buyer knew and subdivided it. Sold the acerage for a cool half mil the same day and then sold the house for 300k after putting 80k in on it.

Again most agents are idiots.

 

[Weather Man]

The real estate fluctuations in the housing market is due to the two completely opposing consumers.

You have tycoons and developers that use real estate as investments with multiple properties they buy and sell. In these cases real estate is an investment and ups and downs affect the pocket book.

Then you have the average buyer and unlikely occasional seller that is looking for single housing only. In this case a home is not an investment its a neccessity that cannot gain or loose value tangibly since its value is nonusable. Even if it were to proposely double its value overnight it would be of no use to that consumer since they couldnt tap in to any of that. For example I paid 165k for my house (pre-foreclosure take over) more than a decade ago. Im in the process of putting 125k in on renovations. House is expected to appraise for 800k but its of no use to me since I cant use any of that. If I were to sell Id loose my ass on taxes and it would cost me at least that much to find something comparable so its useless.

The fluctuations come in the market when more investors sell while single consumers need housing and have no other option than to buy or be homeless.

Im big in to real estate and I cant seem to pass up a deal. Last deal I seen was over 2 years ago now. The real estate market in the greater new orleans area has been dead since.

Staging a home is for ignorant buyers. When I see a house I want to see all the walls and floors unobstructed to evaluate actual condition.

The majority of real estate agents are shit.
Biggest problem with agents are they fail to give accurate descriptions and lack pertinent info.
Agents that use the MLS only are useless.
If an agent doesnt have a book full of investors and buyers they are useless.
If an agent isnt closing on at least 4 homes a week they aren't worth a damn.

If an agent doesnt list the actual lot sq ft, rear yard access, flood zone, doesnt include half baths, the age of roof ac and major appliances they are useless.

And for the love of god the biggest problem with most agents IME is they do not include the cost of the land.

Some idiotic agent sold an inherited 4bath 2br 1500 sq ft home in the greater new orleans area for 150k. Idiot failed to realize the acerage it was on was worth 3 times that. The buyer knew and subdivided it. Sold the acerage for a cool half mil the same day and then sold the house for 300k after putting 80k in on it.

Again most agents are idiots.

Real estate is gonna shake the tree hard on agents. The lazy ones will get shook out fast.

 

[MG0h3]

The real estate fluctuations in the housing market is due to the two completely opposing consumers.

You have tycoons and developers that use real estate as investments with multiple properties they buy and sell. In these cases real estate is an investment and ups and downs affect the pocket book.

Then you have the average buyer and unlikely occasional seller that is looking for single housing only. In this case a home is not an investment its a neccessity that cannot gain or loose value tangibly since its value is nonusable. Even if it were to proposely double its value overnight it would be of no use to that consumer since they couldnt tap in to any of that. For example I paid 165k for my house (pre-foreclosure take over) more than a decade ago. Im in the process of putting 125k in on renovations. House is expected to appraise for 800k but its of no use to me since I cant use any of that. If I were to sell Id loose my ass on taxes and it would cost me at least that much to find something comparable so its useless.

The fluctuations come in the market when more investors sell while single consumers need housing and have no other option than to buy or be homeless.

Im big in to real estate and I cant seem to pass up a deal. Last deal I seen was over 2 years ago now. The real estate market in the greater new orleans area has been dead since.

Staging a home is for ignorant buyers. When I see a house I want to see all the walls and floors unobstructed to evaluate actual condition.

The majority of real estate agents are shit.
Biggest problem with agents are they fail to give accurate descriptions and lack pertinent info.
Agents that use the MLS only are useless.
If an agent doesnt have a book full of investors and buyers they are useless.
If an agent isnt closing on at least 4 homes a week they aren't worth a damn.

If an agent doesnt list the actual lot sq ft, rear yard access, flood zone, doesnt include half baths, the age of roof ac and major appliances they are useless.

And for the love of god the biggest problem with most agents IME is they do not include the cost of the land.

Some idiotic agent sold an inherited 4bath 2br 1500 sq ft home in the greater new orleans area for 150k. Idiot failed to realize the acerage it was on was worth 3 times that. The buyer knew and subdivided it. Sold the acerage for a cool half mil the same day and then sold the house for 300k after putting 80k in on it.

Again most agents are idiots.

Why would you lose your ass in taxes?

Are you thinking capital gains?

You are exempt if you’ve lived in the house for 2 of the last 5 yrs.

Maybe I missed that you’re renting it.

Also, “losing” on taxes because you’ve earned more money is still a win.


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[Detroit Iron]

Due to covid, home prices went crazy the past two years. With interest rates nearly doubling in a few months, buying power for those that need loans was likely reduced 30%...this has to lead to lower home prices. Throw in massive inflation and a job loss recession and it is all but guaranteed.

 

[DriftwoodSVT]

So glad we cashed out last year!

 

[black4vcobra]

For reference and for shits and grins, when I rented a one bedroom out there on the SW side (Waterford Circle), I paid $785/month rent. This was in ~2014. I always figured part of the higher rents were due to students and Epic employees.

A shanty two houses down from me just went up for sale. 15xx sq ft ranch built in the late 60s. Partially updated. Good starter house IMO. Asking $329,900. That's ridiculous for that house around here. And they've got an offer! Fingers crossed a burner who likes to drink moves in. I like fun neighbors. haha

Rewinding for the sake of local comparison, four years ago I paid $335k for 2500sq ft, completely updated (inside and out including roof, siding, windows, gutters, garage doors...) two stories, 4 bdrm, 2.5 baths (upstairs are both dual vanity) and 3.75 car climate controlled garage. Really puts things into perspective when you've got places right around you going for insane prices. Also makes me happy we bought when we did. lol

Maybe my $2k figure is for more like 1000 sq ft as it would have to have 2 bedrooms but either way, that's way too high and yup, Epic, Exact Sciences, UW, etc all drive rentals up.

But ya, anyone who bought between 2011 and 2016 has seen there property values go up significantly. We did and it's one of the reasons we can upgrade significantly.

If you are ever heading to Madison or beyond, let me know and we can grab a beer. I'm only about 1.5 miles off of 94 in Cottage Grove.

 

[TerminatoRS]

Maybe my $2k figure is for more like 1000 sq ft as it would have to have 2 bedrooms but either way, that's way too high and yup, Epic, Exact Sciences, UW, etc all drive rentals up.

If you are ever heading to Madison or beyond, let me know and we can grab a beer. I'm only about 1.5 miles off of 94 in Cottage Grove.

Exact Sciences...aka the Turd Plant lol I toured that place before they opened while I was with UPS. Crazy how many steps are involved in analyzing people's pooper pies.

Will do brother!

 

[shurur]

I disagree. I don’t think it will pop like 2008 by any means, but it’s going to deflate like a mofo.


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Stagnant and deflate seem like the same thing to me.

We aren't going to see the foreclosures like we saw in 2008, because less folks are upside down and losing their jobs.
Banks were somewhat smarter about who they loaned to.

Tampa is still ridiculous IMO and may remain so for some time.

And yes not enough lower income housing is being built in some areas.

Everyone who already has their piece of land wants more build-up-not-out housing for everyone else.
But who want to live in a collapsing hi rise?

I wish the wife were not so entrenched here. We are looking at renting forever here.

 

[black4vcobra]

Tampa is still ridiculous IMO and may remain so for some time.


I wish the wife were not so entrenched here. We are looking at renting forever here.

Ugh, that would piss me off to no end.

How old are you?

 

[q6543]

Lol.. on the line at ford like 4 people in my immediate area are "real estate agents" as a side hustle.

I'm like .. just work some damn O.T.... whatever.
People gotta dream about their own business I guess.

 

[Stanley]

I'd like to buy some rental property so hopefully the market drops off to some degree.

 

[Steve@TF]

Why would you lose your ass in taxes?

Are you thinking capital gains?

You are exempt if you’ve lived in the house for 2 of the last 5 yrs.

Maybe I missed that you’re renting it.

Also, “losing” on taxes because you’ve earned more money is still a win.


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Youre only exempt $250k per person on the deed, up to $500k total. Everything beyond (profit) that is taxed. You do get to deduct the $ you put into it. If he has $300k into that house and it sells for $800k hes good (if two people are on the deed. $250k will be taxed if its only him).




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[Steve@TF]

Both my brother in laws are iron workers. Since covid started theyve been working like crazy. Lately work has been super slow. Sucks for one because hes trying to buy a house but his income keeps fluctuating. He waited far too long.


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[BlueSnake01]

Both my brother in laws are iron workers. Since covid started theyve been working like crazy. Lately work has been super slow. Sucks for one because hes trying to buy a house but his income keeps fluctuating. He waited far too long.


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Im sure it'll drop here in LA a couple of hundreds. There's waaaay too many houses for sale that arent selling right now. Overpriced + higher interests.

The current avg household income in LA is 60k I believe, no possible way to afford a simple home here with that income. Maybe with 4 families together LOL