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.
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 remember the mid-2000s market very well. Yes, demand was artificial but there were often multiple offers. Inventory in my market in 2006 was about 15 times the current inventory but the number of buyers was likewise high because almost everyone was buying for speculation. It wasn't the usual buyer crowd. Cooks, postmen, servers, roofers, bartenders, all income levels. People were buying multiple properties worth many times their income with easy-to-get, low down payment loans. New condo developments actually had lotteries with buyers drawing tickets for the right to reserve a pre-construction unit.
Today feels the same except that today's buyers using mortgages actually have to demonstrate an ability to make the mortgage payments. Not sure what would turn this around. We have three weeks inventory right now and the flock of buyers looking seem willing to pay anything to win.
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.
I haven't seen very many foreclosures lately in my market, and I certainly wouldn't call the ones I've seen "deals." I would expect to have more hitting the market later this year though, and it may help a smidge with inventory.
I'm in Raleigh and our market is on fire. Austin might be a bit hotter though.
We have no inventory here and plenty of tech jobs coming in. I don't see costs dropping.
I can see how pricing in some other parts of the country will be unsustainable though.
Right, the job growth plays a big role in things. Plus Covid has helped some too...more people are working hybrid or 100% remote schedules, so places that used to be considered "far out" have seen exponential growth and in turn housing prices...
I don't believe our home will return to the value it was seven years ago that's for sure. I am doubtful about the rapid appreciation, but that is due to my cautious side. Here I am almost a year later, and things have only gone up and still hardly a house on the market.
Quote:
Originally Posted by AnesthesiaMD
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.
Thats all I was saying.
Agree with the first part. Our home is worth more than double what we've paid for it in 2015, and the biggest boost occurred in 2021-2022. I frankly find that mind boggling, but since I consider my home a place to live foremost, it elicits a "that's cool" reaction. I don't see the prices tumbling too far from where they are now because of the job growth, more flexible work schedules, influx from other states. In my particular subdivision, the demand comes from the custom housing and large wooded lots. Amenities are within minutes in all directions. I think that will remain attractive to buyers and as a result will keep prices higher. I don't think that they will return to the prices several years ago. that ship has sailed permanently i'm afraid. The people buying have more money to spend now than before.
I think the whole work from home thing contributed to our housing boom too. We are "middle of nowhere" and we have a low inventory of homes, what comes on the market is bought within days.
It's good from the standpoint that I had reconciled myself to see small increase in home value, as we were coming from owning homes on Oahu and San Francisco. But it took a big jump in the last two years. Unfortunately I just looked at my 401k, and it is not doing the same.
__________________ ____________________________________________
My posts as a Mod will always be in red.
Be sure to review Terms of Service: TOS
And check this out: FAQ
Moderator: Relationships Forum / Hawaii Forum / Dogs / Pets / Current Events
Right, the job growth plays a big role in things. Plus Covid has helped some too...more people are working hybrid or 100% remote schedules, so places that used to be considered "far out" have seen exponential growth and in turn housing prices...
I don't believe our home will return to the value it was seven years ago that's for sure. I am doubtful about the rapid appreciation, but that is due to my cautious side. Here I am almost a year later, and things have only gone up and still hardly a house on the market.
Agree with the first part. Our home is worth more than double what we've paid for it in 2015, and the biggest boost occurred in 2021-2022. I frankly find that mind boggling, but since I consider my home a place to live foremost, it elicits a "that's cool" reaction. I don't see the prices tumbling too far from where they are now because of the job growth, more flexible work schedules, influx from other states. In my particular subdivision, the demand comes from the custom housing and large wooded lots. Amenities are within minutes in all directions. I think that will remain attractive to buyers and as a result will keep prices higher. I don't think that they will return to the prices several years ago. that ship has sailed permanently i'm afraid. The people buying have more money to spend now than before.
The thing about if covid helped homes go up in price due to work from home, well how would that be. Whether you work from home or in the office, you have to have a house to live in regardless. Its not like before work from home became more common, people were sleeping and living inside the office outside of working hours. So why would work form home cause more demand for homes. Well maybe homes in rural areas that were once too far away to commute, but homes closer by then wouldn't demand drop for them. Just does not make sense in either case.
I think the whole work from home thing contributed to our housing boom too. We are "middle of nowhere" and we have a low inventory of homes, what comes on the market is bought within days.
It's good from the standpoint that I had reconciled myself to see small increase in home value, as we were coming from owning homes on Oahu and San Francisco. But it took a big jump in the last two years. Unfortunately I just looked at my 401k, and it is not doing the same.
Yeah yikes we are entering a period of flat or high appreciating home values and maybe declining stock prices. 2000 to late 2002 all over again. A horrific nightmare for anyone trying to save to pay cash for a house. That was once me from 2009 to 2013 living with my parents until I got my home paid for in full in nick of time. Fortunately stock market was also good then and homes were flat until they started to escalate in price 2013 and maybe even late 2012 to hyper local extent, but got my own paid for in nick of time 9 years ago this month.
And really does not matter to me whether it increases or decreases in value as it is my own home that I can be rent and mortgage free, not a money making machine.
Investments in stocks and bonds and such are another animal as those are only used for money and nothing else.
I remember the mid-2000s market very well. Yes, demand was artificial but there were often multiple offers. Inventory in my market in 2006 was about 15 times the current inventory but the number of buyers was likewise high because almost everyone was buying for speculation. It wasn't the usual buyer crowd. Cooks, postmen, servers, roofers, bartenders, all income levels. People were buying multiple properties worth many times their income with easy-to-get, low down payment loans. New condo developments actually had lotteries with buyers drawing tickets for the right to reserve a pre-construction unit.
Today feels the same except that today's buyers using mortgages actually have to demonstrate an ability to make the mortgage payments. Not sure what would turn this around. We have three weeks inventory right now and the flock of buyers looking seem willing to pay anything to win.
That was the theme of the Lewis book The Great Short and the subsequent movie.
That was the theme of the Lewis book The Great Short and the subsequent movie.
Both excellent. One other similarity from then to now is the rush of new agents. It seemed everyone was getting their license so they could get a piece of the action. In that respect, today feels a lot like 2005-2006.
The thing about if covid helped homes go up in price due to work from home, well how would that be. Whether you work from home or in the office, you have to have a house to live in regardless...
People needed extra space or room for a home office because they were working at the dininng room table. They were home more so they wanted a nicer home since they were in it more, a pool in the backyard, or since they weren't going in to the office 5 days a week they moved out of the populated areas to a place with a bigger yard and more privacy, or to another state even sometimes and work remotely. Lots of reasons unique to the people moving.
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.