Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
Before the last crash I read a great article in the WSJ about how every crash is preceded by flocks of speculators giving all the reasons why THIS time it is different.
Every crash is a crash. Just a matter of cause, correction, and length. The next economic crash is unlikely to be caused by the housing industry, which is what caused the last one.
I thought Covid was gonna do it, but it went the other way with housing demand. Perhaps it will be a war this time, although I hope the current invasion of Ukraine can be resolved quickly and decisively with Putin being removed from the equation.
I am selling my house next month... well, putting it on the market. So many in my family are saying I should put it on the market now, but it's not ready. Houses that sell in a weekend (in my area) are always ones that look neat, tidy, and clean. I am still doing some of that (painting is the big project that needs to be done). There is a house in my neighborhood that's been on the market for three weeks and hasn't budged. It looks like an abused rental inside: carpets are black in the corners and worn and need to be replaced, walls are a dozen different colors and all scuffed up, stains on the ceilings upstairs from a leaky roof, there is rotted wood trim on the outside, etc. Actual repairs it needs (that I could see with my amateur inspection eyes): the deck needs to be replaced (the wood is soft and rotting) and it needs a new roof. I am not sure if there is more water damage where the rotten wood is on the trim.
So there are houses to be found still, but people need to put work into them. I think the people selling the "eyesore" house in my neighborhood are also asking too much money. They have it listed for $590K and it just sits whereas really nice, fully updated houses are listed for $660K and coming off the market in a weekend (I haven't seen what their actual sales prices are yet).
For comparison, I plan to ask $580K-600K for mine (depending on what those recent sales prices were). I don't have the updated kitchen and baths that the $660K houses have. But unlike the $590K eyesore, mine has all new floors and will be freshly painted, has no rotten wood or other damage, and needs nothing replaced, etc. It's turnkey, but is dated in the kitchen and two of the bathrooms. In the end, I will let my realtor suggest a price range and I will go from there.
Edited to add: Before anyone suggests updating the kitchen for $20K and reselling for $660K, it's not going to happen. I've had boots in the kitchen so to speak, got quotes, etc. If there are no hidden repair costs that might pop up when upgrading, I am pretty much looking at breaking even if I replace the kitchen and bathrooms. I might make $5K or even $10K, but it's just as likely that there will be some "hidden cost" and I lose $5K or $10K. So my opinion is that I rather sell my house for less and let a new owner upgrade how they want (if they want... it doesn't "need" to be upgraded. Nothing is broken).
Last edited by WalkingLiberty1919D; 03-07-2022 at 07:07 AM..
Every crash is a crash. Just a matter of cause, correction, and length. The next economic crash is unlikely to be caused by the housing industry, which is what caused the last one.
I thought Covid was gonna do it, but it went the other way with housing demand. Perhaps it will be a war this time, although I hope the current invasion of Ukraine can be resolved quickly and decisively with Putin being removed from the equation.
I agree, the next economic bubble to burst will not be a real estate bubble. At the same time, real estate prices will fall as a result of the economic downturn. I think the next recession will more likely be related to the measures used to get inflation under control. But time will tell.
Someone much smarter than me once said " The only thing that will cure high prices is high prices ". But that's only in a free market capitalist society of which we are slowly losing. Loan forgiveness, social programs and such, all make Milton Friedman's one liners less and less relevant.
As someone who looked at homes from 2003 - 2008.
The talk was exactly the same.
Better buy now as prices are only going to go up each year.
The baby boomers, etc. are all buying up the homes.
Construction costs are only going to go up.
There is a shortage of homes.
Interest rates are only going to go up.
Better buy now as prices are only going to go up.
Looked at a housing development of 1,200 homes as developer was just finishing up in 2006/7.
Well, in 2008, in this development that completed the last new home out of 1,200. About 90% of homes had a for sale sign. Mostly foreclosures and short sales.
Oh, but that can't happen again. Right?
It is "different" now.
There will never be another recession.
Someone best look up history. As there has been a recession on average every 7 years in the USA. Some big. Some small.
Housing prices will never go down. Right?
Recessions...are not the same has housing bubbles popping.
Notably, what is different is rampant subprime lending. And while I wasn't as "in-tune" at that time, I also don't remember actual supply constrictions being as much of a thing. While prices took off, I don't remember houses getting dozens of offers. Prices skyrocketed but the demand was artificial.
I was just on vacation in South Florida with my family, and as I often do when I am on vacation somewhere, I was looking for potential real estate deals. I have to say, it is looking real frothy there right now, especially anywhere near the beaches. Tons of flippers. Homes bought for 1 or 2 million last year, now back on the market for 4 or 5 million. It's looking a lot like 2006 to me again, and I'm thinking 2 years from now there will be some pretty good foreclosure deals to be had. Time will tell.
There are foreclosure deals now. Just prices aren't going down though.
I live in Irvine. Everyone thinks California is dying, but not my city. Crazy 50% appreciation it feels like.
There are foreclosure deals now. Just prices aren't going down though.
I live in Irvine. Everyone thinks California is dying, but not my city. Crazy 50% appreciation it feels like.
Seems to feel like 50% appreciation in a whole lot of places right now though. The challenge isn't in seeing the present. It is in seeing the future.
Every market is different. Where are the buyers coming from? Are they tech people moving into the area? That seems promising if they are. That is an area where the prices will be stable in the downturns.
Are they flippers? Then maybe not so promising. These aren't people with steady incomes buying the homes to raise families in over the next 30 years. They are people buying up homes, making them cosmetically presentable, and trying to sell them for 200% or 300% profit. Nothing wrong with that. I'm not judging here. I know some really good people that do that. But some markets are flooded with these types of buyers. Those are the markets that take wild price swings when the markets fluctuate. South Florida has a history of that, and if you study the real estate sites, it seems like history is repeating itself again.
No one is saying they’re never going down. We just don’t know that they will, and if they do, we don’t know when. So if you’re in the market to buy a home today, you’re taking somewhat of what gamble whether you buy now or wait. I’m of the opinion that we have at least another year of price increases. And if prices do eventually come down I wouldn’t count on them returning anywhere near 2019 prices.
A return to 2019 prices which were already very very very high is quite likely. Prices skyrocking more than ever during an economic crisis pandemic was not normal from already very high levels of 2019.
Now a return anywhere near 2010-2012 or even 2014 prices. I doubt. 2019 were already very high and it was not long ago. 2010 to 2012 was long ago and prices were so much much much lower than 2019 and even 2014-2015. I do not think we ever return to any of those prices. But 2018-2019 or even 2017 when prices hit record levels is quite plausible.
And 2008 was different from previous downturns like the Great Depression. Every economic downturn or real estate correction is a little different that previous ones. Legislation got passed trying to prevent 2008 from happening again. But that does not mean different factors cannot cause problems.
We did not have inflation like today in 2008. But we did 40 years ago. Study that.
Well actually inflation in 2008 while not like today was not exactly low. It was over 4% before the Fall 2008 and the great crash of everything. Gas prices and oil prices went through the roof throughout 2008 all the way until the 4th of July.
Difference was home prices were declining throughout 2008 and even fast while gas prices, oil prices, and other energy and even food were going through the roof until that all changed when all financial markets went through a deflationary crash with Bear Sterns and Lehman collapse.
Today inflation is similar in food and energy, though it is more widespread as it is happening in cars as well as even some technology parts. And of course homes are going up in and have been in price unlike flat home prices 2007 before the high energy/food 1st half inflationary 2008.
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
