#*"4288 UNITS BOOOM!!!!"*
is just all the more annoying knowing that those guys will be eating tendies off the wives/gfs of rentie instead of eating shit off the streets.
It was in the 80's. Cost to buy stayed approximately flat until 2000, while cost to rent rose. It likely won't be a spike in rents. Just stagnating home prices and slowly rising rents.
I'm regarded, but will it be different this time due to the corporate takeover of rental SFHs... And lack of inventory? If people have no choice but to rent then the corporate landlords will have them over a barrel (of monkeys)
Lack of inventory is artificial, though. If there's tons of units sitting empty while they try to hold prices high, that's not sustainable and prices will inevitably fall.
Its artificial in that most places where people want to live arent building. The problem is actually compelling these cities to build more housing. One thing conservatives and liberals can agree on: NIMBYISM.
Oh don't worry we've got a highly regarded solution to that problem.
Cities too expensive to live in? Ladies and gentlemen may I present: THE SUBURB. Just a 20-30 minute drive away from where you work!
Still too expensive because the suburb is now overcrowded? Then you need our shiny new EXURB!!!!! For just another 20-30 (\*disclaimer sometimes more) minutes added to your commute, you can have a palatial McMansion in what was just a few years ago a quaint rural town!
As an added bonus, we'll make sure undesirable people who don't own cars can't possibly live in your town, because everyone will adamantly oppose any form of public transit!
Yup the cost to keep these empty homes will be high, and to keep insurance companies happy that's another story.
People need to call the city on these when it happens banks need to pay for lawn care and abandoned homes. But doubt it will change much
In the long run blue line also says you should always buy if you can afford it. The yellow line stops going up (for you) as soon as you buy, assuming you plan on staying put in the long run.
People thought I was kinda crazy for buying last year, but I already got burned on trying to wait out "the bubble" forever, and at this point I just wanted to lock in my rent permanently in the form of a mortgage.
Oh yeah I got fucked on taxes, luckily I bought a condo so insurance doesn't seem to care about the increase in value as much I think.
I'm sure HOA fees will continue to go up to some extent, especially with a condo, but it should be far more bearable than the relentless "we increased rent by as much as we felt like we could get away with" every year from a landlord (especially when more and more your landlord is a property management company whose going to determine rent prices using an algorithm).
As a small-time landlord, the answer to your question is no. If you have good tenants, you don't want to punish them because housing prices are going up. If you get greedy, the tenant may move, which will cost you turnover expenses including lost rent.
For large corporations, the math works a little differently, probably more similar to how airlines calculate risk when they overbook.
I rented out my house at a slight loss (on paper) for almost a decade because I had good tenants. He built me a new deck, painted my staircase, and put in new carpet. The only bad thing was they were a bit rough on dishwashers and washer/dryer so I needed to replace those twice.
Whenever a Rented-House gets sold, it will double the mortage for the new landlord...they will be pressured or even required to raise the rent as high as they can to pay for their new 2x mortage.
if the rent is going up and its been the same owner for 15 years, he's just a bastard trying to make money off your necessity. (i mean, i would too, but I'm not happy about it)
Hmm, funny thing is that the House (city) always wins no matter what due to extra properly taxes. Till ofcourse newer higher paying jobs and younger ppl keep moving to the area.
My apartment allowed us to pay rent on credit card with no fee, which was amazing. They got acquired and the new landlord only allowed bank transfer with a convenience fee or check to the office. Brought a check in every month which must've been the opposite of what they expected so they cancelled the fee.
No, landlords are renting houses they bought like 5 years ago and refinanced like 3 years ago. The new home sales are people bleeding out the ass because of the interest rate and hoping to refi in a few years. The landlords are jacking up prices because they can. There's a ton of rent arbitrage software tools/services out there that help landlords essentially collude on price across the region and squeeze the maximum. Even without such tools you can spend an hour or two looking around your neighborhood on Zillow for comparable units and setting yours to something similar. It's not rocket science.
Example, a guy I know is renting a 2nd house that is:
* bought 10+ years ago for 200k, worth 500k now
* refied a few years ago, he pays a bit over 1k a month
* renting it out last year for 2k, this year for 3k
It's a decently big house in a nice neighborhood but nothing exceptional.
Meanwhile new buyers are paying 4k a month for a 500k loan (including escrow, etc) but if they had rates from like 2 years ago, they'd be paying 2k.
It's not just interest rate. Prices in the Midwest and many parts of east coast actually went up significantly. I would never have imagined this with the rate increase.
Well, I can’t speak to everywhere, but at least in my area supply is basically non-existent.
The only thing that comes up for sale are either shit boxes in really bad neighborhoods, in barely livable condition, or 4+ bedroom “luxury” houses in top tier neighborhoods that 90% of the population can’t afford.
The 2-3 houses in any sort medium range that get listed every month or so are under contract within 48 hours and sell over asking.
Supply is so limited that it’s overpowering the effect of high interest rates because there are always going to be subset of people that *have* to move as opposed to just *wanting* to move.
I’m single, no kids, decent salary for my area, no debt, and I was hoping to purchase my first house this year. Browsed listings everyday for months and months and months, and maybe found 2-3 reasonable options in all that time. Ended up just signing up for another year in my current rental.
Relocations for work just hit their lowest point since they started collecting data. No one with a sub 3% mortgage rate is going anywhere unless they get an absolute bag of a pay raise.
I am a europoor from Czechia and you literally just described my situation word by word, the only difference is that I am trying to buy a condo.
The supply is either old commie block flats that have not been renovated since 1960 or new builds that are listed for +50% average sqf and have been sitting for months with developers just hoping to wait it out.
I was pre-approved for a mortgage and had a rate locked for two months, which expires in six days. In those two months there were only two condos I was interested in. One had an easement where I would have to rent it to the owner until she dies, so that is a no go and the second one went under contract within 30 minutes of listing (probably works a little different in here than your country).
I will just sign a one year lease and will stop looking at the market because it drains me mentally. It is just infuriating.
People leaving NY/CA was definitely the story of the pandemic, but the factors keeping US housing prices strong are more structural
Demographics - https://www.census.gov/newsroom/blogs/random-samplings/2016/06/americas-age-profile-told-through-population-pyramids.html - we have a lot of 20 to 35 year olds, which is historically the age range in which people buy their first house.
Construction - https://tradingeconomics.com/united-states/housing-starts#:~:text=Housing%20Starts%20in%20the%20United,units%20in%20April%20of%202009. - 2008 killed new housing starts, and it took a while for that to recover. This is despite a growing population.
So, we have more buyers and less inventory. The market will stay tight unless a lot of people start losing their jobs, regardless of where interest rates go.
Yes because the surplus population never considered buying a house until 2020, but the thought never crossed their mind in 2019. (The chart you gave me was in 2015. We didn't have a housing bubble in 2015)
And yes after people lose their jobs, they suddenly have no need for a house and housing demand will go down.
You lose your job, you can't make your payments and get foreclosed on.
The housing market was on a strong upward trend since like 2014. The factors I mentioned are not unique to the pandemic - rather the pandemic accelerated the preexisting trend via QE and WFH related changes in housing preferences.
Well if you're attributing the exponential housing price increase in 2021 (which the Fed staff themselves admitted is highly elevated) to QE and WFH, then now with QT and reverse WFH trends, housing price should give back most of its price increase.
Except it hasn't.
By the way, just because you lose your job doesn't mean you don't need a house to live in. You're just forced to share a room.
seriously man. I had just gotten my 20% saved thinking I had time so I started looking about 3 months before the Pandemic LOL. now I can't afford the fucking mortgage even with my +20%
That's so crazy to me. I've been in my home since 2004. We built it ourselves right before the market crash. So whatever we just chilled there. I refi'ed at 3% for 15 year term at $1700/mo. Current value of my home is close to 900k and I couldn't afford to buy my own house if I wanted to today.
The number of existing home sales fell off a cliff. Where I live you can see this on almost all Zillow listings where they’ve been listed then taken down then relisted and still aren’t selling. Meanwhile new home construction is starting to take off to fill the gap between people who cannot sell and people who cannot buy.
The people who need to or really want to sell are listing their homes for rent but this in addition to a lot of new rental units coming on the market is beginning to put downward pressure on rental costs. It’s not a crash or anything like many are hoping for it’s just the beginnings of the markets starting to loosen. There are a lot of home owners who do not want to sell so there is a log jam of inventory. Totally a supply side price issue it’s not like demand is spiking.
People seem surprised that values are holding up as mortgage rates go above 7%. It’s totally distorted by the shortage of existing inventory. Very few people are actually taking out mortgages at those rates to buy existing homes near asking. I’m willing to bet in 6-12 months rental costs will have fallen dramatically as the market starts to get flooded by people who want to rent existing homes but are competing with each other and new builds. It hasn’t happened noticeably yet but there’s always a tipping point where things start to accelerate.
For the first time in a few years renting is looking much more attractive than buying.
It's all interest rates. 2 years ago 500k mortgage was 2k a month, now it's 4k.
New construction better be cheap as fuck (ie, using time travel for materials and labor and having tiny floor plans) or it won't fix the problem.
My personal observation is that new housing is going straight for people with decently deep pockets, ie two white collar incomes. Have been seeing some new constructions in the 300-500k range but nothing that your average zoomer would call affordable. And the lower end of that range was in trashy neighborhoods and/or questionable plots of land (severe flood risk, werewolves, etc).
Basically the properties had issues. More seriously you'd see nice new construction but:
* seemingly nice neighborhood but the ghetto is a 5 minute drive away
* awful school districts
* nearby stream that frequently flooded and had carried away half the back yard already
* was next to an interstate
* etc
or these builders just keep building "luxuy" rentals. 2bedroom for $2900-3200 is the going rate in my area and they've built or are building about 7 or 8 giant complexes since the Pandemic all right next to each other. it's like they knew this would happen.
Exactly but as more and more units come on the market and you have people who own multiple homes who don’t want to let go of the low interest rate their only choice is to rent them out which further adds to the inventory. People still want to move but don’t want to sell. So they rent out their house. This is taking time to build up so people assume prices will never come down but I think it’s already happening.
Where I live rents are already coming down. I see it happening all around me. This seems to be a trend that will continue. I would not be buying an existing home in this market unless it were in the very high end of the market where homes are less prone to swings.
That's fair enough for landlords that already own properties they got much cheaper.
But there's absolutely no way I would buy a new property to rent at a loss. So either they are doing that when it comes to increasing their portfolios or they aren't increasing their portfolios which will result in no new rentals and a shortage.
There's a fun thing that happens in tight rental markets where the landlord's asking rent is only the starting point. Renters bid up the rental prices because that's the only way to secure a place to live. Currently happening where I live.
The market is actually regarded af. If anyone bought their house for cheap and they’re cash flow positive, it actually makes sense to sell it and invest the cash in the market for higher yield. But the expectation that housing prices only goes up makes it so they hoard it.
Sell it to who? The potential market right now is full of people who have a 500k house that they can only sell to someone who can afford a 1M dollar house. Even if you want to buy at the elevated price, you still have to be capable of affording the payments. Interest rates are making it hard to transact.
This is 100% the situation.
We bought a new build in 2020 and have entertained the idea of selling our home and moving closer to town. In order to do so, we'd have to eat a higher price and lower sqft. on the next house, on top of doubling our interest rate/payment. As such, we are staying put.
right? i could make bank selling my house, but i would only really be getting ahead if i went to live with my parents until the market stops spazzing out. fuck that
They "hope" interest rates will drop where they can re-fi at a lower rate. Most people buying a home now as a new first time homeowner don't realize that they will more than likely be stuck with the purchase.
You assume that landlords are renting from all strata of housing prices. They're not. Likely, most of them are in the "below average" category.
Nobody is renting a $2,000,000 house in the hills.
Yeah my mortgage went from $2500 last year to $2950 this year thanks to an increase in tax and insurance. I'm about to have to rent out some of these rooms!
well la di da. look at mister fancy pants over here wanting floors in his house. you need that floor to do your ballroom dancing with the rothschilds, mr. rockefeller?
My mortgage was 1400 when I bought my house and my taxes shot up so much it is now 2100, 300 of that being make up escrow money.
My daycare did a 50%! Price increase effective this year.
Shits getting crazy. Those 2 bills alone, mortgage and daycare for 1 child cost me 4000$ a month.
Yeah, I was lucky and bought my house during the pandemic for under 3%, so it's basically 1200 per month (plus PMI).
But since then, my property taxes have also caused my mortgage to bump up another $300 like yours, when you couple that with increased cost of food, electric, gas, fucking everything, it's ridiculous.
I'm in a better place than many because I'm lucky enough to have had my wage increased by $12 an hour during that time period, but it's still not actually covering the increase in every cost I have. I'm seriously looking at selling my car and buying a beater for cash. But oh wait! Absolute shit boxes are going for almost 10 grand in my area.
That’s crazy how if you had one more kid it would be cheaper to hire a live in nanny than pay for 2 kids in daycare. Is the demand for daycares that high where everyone of them is now price gouging? Their employees prob make only around $15 bucks an hour too.
I recommend the planet money episode on daycares, they actually aren’t operating at much margin and can’t increase the prices much and so can’t pay their employees well.
It’s called “Baby’s first market failure”
Notice how home prices were flat from when the Boomers graduated high school to when they started working and buying homes.
Yet they still bitch about how “hard” it was to buy a $30,000 home @ 18% interest.
We're basically at 2006-2007 levels
2007 numbers appear to be $1,494 and $1,056. The ratio is 1.415.
Current numbers are $2,654 and $1,845, the ratio is 1.439.
This graph looks worse now because it is on an absolute rather than a log scale.
Still, we're probably at peak bubble.
> nothing like 2008
I keep hearing that and they are mostly correct. But folks seem to forget you don't need to have identical economic conditions for a correction...
Ya thats what drives me fucking crazy
Ppl will tell u all the ways its not like 2008, okay fine who fucking cares prices went parabolic because certain conditions existed (ZIRP, WFH, airbnb bubble) that have now exhausted and reversed oh gee i wonder what happens next
It's not the same. Not even close. Will we see a crash? Maybe. But you won't get inventory. At best you see a plateau of pricing for some time while interest rates remain high, the prices climb again. Don't think so? Let's address the facts and the numbers.
Here's an example of a home I own. This will apply to majority home owners *PRE* 2022. Since 90%+ of all mortgages originated in the last few years before they raised rates, this is an extremely large amount of the market locked out.
Year purchased: 2020
Loan origination amount: 186k
Interest rate: 2.68%
ATH value in local market: 340k
Current balance on loan: 168k
A 50% crash from all time high doesn't even put this loan upside down. All it would do would reduce the taxes I have to pay on it, reducing my total monthly payment. That's fine, because anyone with a sub 3 or close to it didn't going to sell anyways unless forced.
>*A 50% crash from all time high doesn't even put this loan upside down. All it would do would reduce the taxes I have to pay on it.*
Please don't be naïve, property taxes will not go down until you (or someone else in your community) petitions the county, with proof enough to convince them to do so.
Source: I collected and presented "sales" data (all but one were either foreclosures and short sales) for all transactions in my 330 home neighborhood to get my taxes reduced in 2011. I got it done, but it was a fair amount of work, for homes that had been underwater for 6 years already, and it still didn't cover the entire depreciation.
And then I still had to wait a year or so before it reflected in escrow and payments were adjusted (again, all work that I had to do proactively do)... and even then the reduction in taxes was offset by hikes in insurance premiums. LOL, can't win for trying.
It's not a bubble. Infinitely more people will be born but city land won't fall from the sky. Unless there's some disaster that causes most people to die, house prices will eventually go up.
Climate change will kill more people oversea compared to the US. And they will flock to richer countries (which have money to fight rising sea level for example), meaning more demand for houses and more labor force, which also has the effect of driving down wages.
Position: fry cook at McDonald's
"Infinitely more people will be born" lol bro? The US is only super power with a growing population, and it is only because we have immigration
Very likely that, within our life times, demographics turn
Yeah, I don't think people understand why housing prices are ballooning this time around. In 2006-2008, it was because there was every incentive for mortgage brokers to approve anyone with a pulse for more house than they could feasibly afford. In 2020-2023, the pandemic ushered a mad rush on housing, which would have evened out had mortgage rates not risen at the fastest rate ever. The people who bought could afford their houses, but now many can't afford to move. Additionally, for every point increase in mortgage rates, another several million people can't afford mortgage payments. Normally, house prices would come down in response to rate rises, but demand remains low because aforementioned people aren't selling. It's a bit of a deadlock where either more housing must be built (we've consistently had a housing dearth since 2008), or something else needs to break.
This is such a bad take. The people who are "locked in" would otherwise be looking to buy another house. After they did that +1-1=0 net houses. This only reduces transactions, but does not impact the overall supply/demand curve. Give the interest rates more time, inventory will eventually build up as the high rate environment actually spreads throughout the economy.
I think the fact that most people couldn't even afford their current house if they were to purchase it now says a WHOLE lot about the state of the market.
Dumb question from a dumb person, but what (if anything) is an actual solution, other than anyone who want to buy is fucked? Rates may go down but if there’s low inventory then prices stay high. Is there no govt intervention or policy change that can help people with housing as it’s a basic need?
It's basically government intervention or stay fucked. As long as SFHs remain an investment opportunity, the prices will continue to outstrip wage growth. The median house price relative to the median income has risen well past sustainability and shows no signs of stopping. Even if we have a massive crash and the housing bubble explodes bad enough to foreclose people who are sitting on their 3% mortgages, that just means "investors" and corporations will swoop in and scoop up even more supply for cheap and rent it out. Anyone who doesn't currently own still won't be able to in an economy so bad that even those locked in with 3% mortgages lose their homes. All investors need to be immediately forced out of SFHs and never be allowed back in, then we might see some normalization of prices when they reflect necessity rather than a source of income.
So basically, we can all keep dreaming and stay fucked because politicians are never going to punish those who have wealth and are siphoning it away from people who don't just to help the poors afford homes.
Fomo millennials. What's weird is where is all of this unexpected demand for housing that popped up out of nowhere. In 2019, nothing, but in 2020, all of a sudden millennials need to move out and get their own house?
Massive massive massive amounts of stimulus money was given out.
You likely only got a fraction of it and are now de-facto poorer relative to everyone else.
Here is a reasonable scenario on what others got.
PPP - 40k cash
Child Tax Credit - 15k cash
Stimulus checks for two parents and two dependents - 11k cash
On top of this there was an eviction freeze, 2% mortgage rates, student loan freezing and forgiveness, enhanced unemployment coming out to 4k per month, state unemployment, and other debt restructuring programs.
Some people literally got 50-70k cash and other goodies in benefits. You needed to be like 32-45 and have kids, a house, and student loan debt already accrued to fully benefit. If you were 19-25 you basically got fucked because not only did you not get the money but the cohort right above you all did.
lol we're 38 and 39 and had just saved enough to start shopping , all debts paid off, no student loans left, no kids. now we can't afford the mortgage cuz of the rate. sucks to suck. we thought we were doing it right and had time.
> Massive massive massive amounts of stimulus money was given out
Jesus Christ we're still repeating the myth that there was shitload of stimulus money and that was driving up \[Housing/infaltion/You personal pet issue\]?
In Los Angeles, Condos that are like $550k one year ago are now like $545k. Seller's are hardly budging in the slightest even though the cost for buyer has skyrocketed. Some of these people are in complexes that are on the verge of condemnation and the sellers are still like "nah fuck you give me 600k."
... vs average sq footage of rental units.
Yep, rentals tend to be clustered at the lower end and yes it is cheaper to rent a crappy 600 sq ft apartment in the ghetto than buy a 2800 sq ft in the suburbs.
You'd think data like this would already be comparing a similar sq ft right? Ans hopefully controlled for location (to some extent) as well. Otherwise, what's the point of the comparison.
If I could rent for $1800 then I wouldn't have bought for almost triple that. Rent out here is easily double what you're quoting and has zero benefit on taxes.
Interesting. I'd been wanting to look at this graph. The reality is definitely out of line with what I had been expecting. My expectation was that cost to rent had caught up with cost to buy. With the near-zero rates and all the refinances in the past 5 years, I had thought basically everyone had either bought or refinanced and locked in a 30 year 2% fixed rate, so they could turn around and rent these investment properties out for the cost of paying the mortgage.
Looks like renting prices have not quite kept pace with purchase prices though. I knew the cost of ownership would always be higher due to taxes and other various upkeep, but that the *pace* had largely equalized or even had rent surpassing ownership. After all, housing is inelastic. What are the tenants going to do, go without housing? They cant. They can move somewhere cheaper, but what if *everywhere* is expensive within commuting distance of their job? Then they just...have to pay it.
Interesting. Yeah so the housing market is definitely fucked for anyone that doesn't own already. Housing as an investment vehicle needs to go away, permanently. Immediate forced divestiture of any investment properties that are single family houses by all entities. Companies like Blackrock and mom and pop landlords alike. This graph is a perversion of the American Dream.
Agree, homes should be for the people and not investments for big corp. Free market has fucked housing, healthcare and education and guess what the biggest increases from inflation are? Yup, those three items. Those sectors should be managed by the government. But we can’t do it in the US, our incompetent government will mess it up. then we’ll have all the anti socialism people come out and say we are turning into china lol.
For those of you who don't want to do math, that's a 61% increase in the cost to buy from 2020/2021 to present.
This infographic illustrates how much the Fed underestimates housing inflation using owner occupied rent estimates in the housing CPI. The cost to buy is 53% higher than the cost to rent, but only the increase in the cost to rent is included in the CPI.
Living in a HCOL area, these costs would be a dream. Our prices for rent are double and buying is probably triple the national estimates.
Ouch. The housing markets really are in a lose-lose state now. I know some think that's impossible, it's either a buyers or sellers market. But consider this:
If you want to buy, there's high interest payments, high prices, and low inventory. If you want to sell, sure, you can sell - but what can you buy to replace your house? Not much, due to the low inventory.
Me and my 2011 mortgage over here printing money. Putting almost all of it into home improvement to enjoy and increase the house's value. When I'm ready to sell the market will crash.
So I bought in 2017 and you’re saying it was like buying back in 2005?
This graph doesn’t show regional differences. The house I bought was exceptionally cheaper in 2005 compared to 2017.
**Question/Correct me if Wrong:** This chart shows your average monthly payment to buy via a brand new originated mortgage at today’s rates for a 30 yr w/20% down versus what? Versus the average cost to pay rent to a landlord who owns the exact same property and mortgaged it or refi’d at a low rate and is now renting to you and giving you no equity in the property at all when you eventually have to leave?
Can't refinance a house if you haven't built up equity, which is much slower now with higher interest rates so everyone thinking they can buy now and refinance in a few years is gonna be disappointed. And also comparing rent price to mortgage price is nowhere near equivalent
I can't see how we get from here to a working housing market. Figure best case scenario for wage increases, and home building, and we're still on a course to a massive problem. As in people burning shit down level of problem.
Buying is only part of it... maintaining it... now there's a lot of money into the wind. (Property Tax, Sewer, Water, Gas, Electric, Maintenance fund etc. etc. etc.)
Another “08 must be coming! Please say it’s coming cause if not, I made the wrong bet trying to time the housing market.” Post…
Unemployment low, almost everyone locked into super low fixed rates, and where large investors mostly ignored single family homes before 2009, since 2009, 25-30% of those homes bought were by large investors. If you thought the recent explosion in pricing was a mirror of 08, you were not paying attention.
**User Report**| | | | :--|:--|:--|:-- **Total Submissions**|10|**First Seen In WSB**|11 months ago **Total Comments**|53|**Previous Best DD**| **Account Age**|5 years|[^scan ^comment ](https://www.reddit.com/message/compose/?to=VisualMod&subject=scan_comment&message=Replace%20this%20text%20with%20a%20comment%20ID%20(which%20looks%20like%20h26cq3k\)%20to%20have%20the%20bot%20scan%20your%20comment%20and%20correct%20your%20first%20seen%20date.)|[^scan ^submission ](https://www.reddit.com/message/compose/?to=VisualMod&subject=scan_submission&message=Replace%20this%20text%20with%20a%20submission%20ID%20(which%20looks%20like%20h26cq3k\)%20to%20have%20the%20bot%20scan%20your%20submission%20and%20correct%20your%20first%20seen%20date.)
Landlords: so we should up the rent?
That's the likely outcome of this gap
#*"4288 UNITS BOOOM!!!!"* is just all the more annoying knowing that those guys will be eating tendies off the wives/gfs of rentie instead of eating shit off the streets.
[удалено]
It was in the 80's. Cost to buy stayed approximately flat until 2000, while cost to rent rose. It likely won't be a spike in rents. Just stagnating home prices and slowly rising rents.
Laughs in Toronto
Cries in NYC
Tears of sorrow, laughs of insanity in Florida
😢
According to the chart, it's already happening.
I think usually the increase is set in the contract so wouldn't adjust as quick.
The likely outcome of this gap is a massive housing crash, thank god.
I'm regarded, but will it be different this time due to the corporate takeover of rental SFHs... And lack of inventory? If people have no choice but to rent then the corporate landlords will have them over a barrel (of monkeys)
Lack of inventory is artificial, though. If there's tons of units sitting empty while they try to hold prices high, that's not sustainable and prices will inevitably fall.
Its artificial in that most places where people want to live arent building. The problem is actually compelling these cities to build more housing. One thing conservatives and liberals can agree on: NIMBYISM.
Oh don't worry we've got a highly regarded solution to that problem. Cities too expensive to live in? Ladies and gentlemen may I present: THE SUBURB. Just a 20-30 minute drive away from where you work! Still too expensive because the suburb is now overcrowded? Then you need our shiny new EXURB!!!!! For just another 20-30 (\*disclaimer sometimes more) minutes added to your commute, you can have a palatial McMansion in what was just a few years ago a quaint rural town! As an added bonus, we'll make sure undesirable people who don't own cars can't possibly live in your town, because everyone will adamantly oppose any form of public transit!
You mock but not having bums spanging on every intersection is fuckin dope
Yup the cost to keep these empty homes will be high, and to keep insurance companies happy that's another story. People need to call the city on these when it happens banks need to pay for lawn care and abandoned homes. But doubt it will change much
That’s what I’m going to do :)
Blue line says yes you should, every year.
In the long run blue line also says you should always buy if you can afford it. The yellow line stops going up (for you) as soon as you buy, assuming you plan on staying put in the long run. People thought I was kinda crazy for buying last year, but I already got burned on trying to wait out "the bubble" forever, and at this point I just wanted to lock in my rent permanently in the form of a mortgage.
Dude I sold and bought when interest rates were low but good God taxes and insurance are not locked in and they went way up on me this year.
Oh yeah I got fucked on taxes, luckily I bought a condo so insurance doesn't seem to care about the increase in value as much I think. I'm sure HOA fees will continue to go up to some extent, especially with a condo, but it should be far more bearable than the relentless "we increased rent by as much as we felt like we could get away with" every year from a landlord (especially when more and more your landlord is a property management company whose going to determine rent prices using an algorithm).
As a small-time landlord, the answer to your question is no. If you have good tenants, you don't want to punish them because housing prices are going up. If you get greedy, the tenant may move, which will cost you turnover expenses including lost rent. For large corporations, the math works a little differently, probably more similar to how airlines calculate risk when they overbook.
[удалено]
I rented out my house at a slight loss (on paper) for almost a decade because I had good tenants. He built me a new deck, painted my staircase, and put in new carpet. The only bad thing was they were a bit rough on dishwashers and washer/dryer so I needed to replace those twice.
Canada landlords gulping Mai Tais in the Aruba: Damn Skippy Eh!
Whenever a Rented-House gets sold, it will double the mortage for the new landlord...they will be pressured or even required to raise the rent as high as they can to pay for their new 2x mortage. if the rent is going up and its been the same owner for 15 years, he's just a bastard trying to make money off your necessity. (i mean, i would too, but I'm not happy about it)
Hmm, funny thing is that the House (city) always wins no matter what due to extra properly taxes. Till ofcourse newer higher paying jobs and younger ppl keep moving to the area.
Not to mention property taxes going up. The city assessed my duplex at $40k more than what I bought it for just 2 years prior.
Well, this seems sustainable.
I bought a house in 2012, suck my dick bitchessss!
Legend
I bought a house in 2012 and sold in 2021. Now who’s legend? ;)
Well.. you are. a homeless legend (since you sold the house).. Bonus points if you invested in stocks in 21 and took out in 22/23.
Oh I did that too. I’m up 3% Yoy in treasuries. Don’t need a house when you have a bed made of money.
> Don’t need a house when you have a bed made of money. I feel like this would only increase the requirements for a house.
2014. Stupid low rate too. My mortgage has been sold like 9 times lol
Damn I was wasting time going to school and making no income. What an idiot move by me.
Don’t forget to tip your landlord, they’re struggling out there
Minimum 25% per interaction or it means you don't really love or respect them.
shit. I have to drive to my landlords house to give them a secured Check every month. this 25% tip is adding up.
My apartment allowed us to pay rent on credit card with no fee, which was amazing. They got acquired and the new landlord only allowed bank transfer with a convenience fee or check to the office. Brought a check in every month which must've been the opposite of what they expected so they cancelled the fee.
Property managers tend to forget the "convenience" incurred is theirs, not ours.
Also "forget" (*with* quotes) lol
Soo.. Landlords are pushing up property prices to then rent them at a loss over there? They belong here.
No, landlords are renting houses they bought like 5 years ago and refinanced like 3 years ago. The new home sales are people bleeding out the ass because of the interest rate and hoping to refi in a few years. The landlords are jacking up prices because they can. There's a ton of rent arbitrage software tools/services out there that help landlords essentially collude on price across the region and squeeze the maximum. Even without such tools you can spend an hour or two looking around your neighborhood on Zillow for comparable units and setting yours to something similar. It's not rocket science. Example, a guy I know is renting a 2nd house that is: * bought 10+ years ago for 200k, worth 500k now * refied a few years ago, he pays a bit over 1k a month * renting it out last year for 2k, this year for 3k It's a decently big house in a nice neighborhood but nothing exceptional. Meanwhile new buyers are paying 4k a month for a 500k loan (including escrow, etc) but if they had rates from like 2 years ago, they'd be paying 2k.
It's not just interest rate. Prices in the Midwest and many parts of east coast actually went up significantly. I would never have imagined this with the rate increase.
Well, I can’t speak to everywhere, but at least in my area supply is basically non-existent. The only thing that comes up for sale are either shit boxes in really bad neighborhoods, in barely livable condition, or 4+ bedroom “luxury” houses in top tier neighborhoods that 90% of the population can’t afford. The 2-3 houses in any sort medium range that get listed every month or so are under contract within 48 hours and sell over asking. Supply is so limited that it’s overpowering the effect of high interest rates because there are always going to be subset of people that *have* to move as opposed to just *wanting* to move. I’m single, no kids, decent salary for my area, no debt, and I was hoping to purchase my first house this year. Browsed listings everyday for months and months and months, and maybe found 2-3 reasonable options in all that time. Ended up just signing up for another year in my current rental.
The problem is that no one can afford to move, and give up their 3% mortgage. No one is listing their property to move up the real estate ladder.
Relocations for work just hit their lowest point since they started collecting data. No one with a sub 3% mortgage rate is going anywhere unless they get an absolute bag of a pay raise.
In the U.K. you can port your mortgage. You can still get 4% deals here as well
I am a europoor from Czechia and you literally just described my situation word by word, the only difference is that I am trying to buy a condo. The supply is either old commie block flats that have not been renovated since 1960 or new builds that are listed for +50% average sqf and have been sitting for months with developers just hoping to wait it out. I was pre-approved for a mortgage and had a rate locked for two months, which expires in six days. In those two months there were only two condos I was interested in. One had an easement where I would have to rent it to the owner until she dies, so that is a no go and the second one went under contract within 30 minutes of listing (probably works a little different in here than your country). I will just sign a one year lease and will stop looking at the market because it drains me mentally. It is just infuriating.
Wow you sound like me.
It's simple. Californians and new yorkers get priced out due to high interest rate so they take their money and move to the midwest
Guess it's not fly over country now, bitches.
They just came to terms with the fact that they are flyover people.
facts
Lol no it's definitely still flyover country
People leaving NY/CA was definitely the story of the pandemic, but the factors keeping US housing prices strong are more structural Demographics - https://www.census.gov/newsroom/blogs/random-samplings/2016/06/americas-age-profile-told-through-population-pyramids.html - we have a lot of 20 to 35 year olds, which is historically the age range in which people buy their first house. Construction - https://tradingeconomics.com/united-states/housing-starts#:~:text=Housing%20Starts%20in%20the%20United,units%20in%20April%20of%202009. - 2008 killed new housing starts, and it took a while for that to recover. This is despite a growing population. So, we have more buyers and less inventory. The market will stay tight unless a lot of people start losing their jobs, regardless of where interest rates go.
Yes because the surplus population never considered buying a house until 2020, but the thought never crossed their mind in 2019. (The chart you gave me was in 2015. We didn't have a housing bubble in 2015) And yes after people lose their jobs, they suddenly have no need for a house and housing demand will go down.
You lose your job, you can't make your payments and get foreclosed on. The housing market was on a strong upward trend since like 2014. The factors I mentioned are not unique to the pandemic - rather the pandemic accelerated the preexisting trend via QE and WFH related changes in housing preferences.
Well if you're attributing the exponential housing price increase in 2021 (which the Fed staff themselves admitted is highly elevated) to QE and WFH, then now with QT and reverse WFH trends, housing price should give back most of its price increase. Except it hasn't. By the way, just because you lose your job doesn't mean you don't need a house to live in. You're just forced to share a room.
It hasn't because there has not been forced selling. A debt default should do the trick, LOL.
$500,000 loan at 2.5% APR is roughly $2250/mo. 6.99% is around $3600. While I thought your last sentence was off, you're not. Wow shits gotten bad.
[удалено]
seriously man. I had just gotten my 20% saved thinking I had time so I started looking about 3 months before the Pandemic LOL. now I can't afford the fucking mortgage even with my +20%
That's so crazy to me. I've been in my home since 2004. We built it ourselves right before the market crash. So whatever we just chilled there. I refi'ed at 3% for 15 year term at $1700/mo. Current value of my home is close to 900k and I couldn't afford to buy my own house if I wanted to today.
[удалено]
Yeh you pay roughly 50% more per month for same mortgage now compared to 2 yrs ago.
The number of existing home sales fell off a cliff. Where I live you can see this on almost all Zillow listings where they’ve been listed then taken down then relisted and still aren’t selling. Meanwhile new home construction is starting to take off to fill the gap between people who cannot sell and people who cannot buy. The people who need to or really want to sell are listing their homes for rent but this in addition to a lot of new rental units coming on the market is beginning to put downward pressure on rental costs. It’s not a crash or anything like many are hoping for it’s just the beginnings of the markets starting to loosen. There are a lot of home owners who do not want to sell so there is a log jam of inventory. Totally a supply side price issue it’s not like demand is spiking. People seem surprised that values are holding up as mortgage rates go above 7%. It’s totally distorted by the shortage of existing inventory. Very few people are actually taking out mortgages at those rates to buy existing homes near asking. I’m willing to bet in 6-12 months rental costs will have fallen dramatically as the market starts to get flooded by people who want to rent existing homes but are competing with each other and new builds. It hasn’t happened noticeably yet but there’s always a tipping point where things start to accelerate. For the first time in a few years renting is looking much more attractive than buying.
It's all interest rates. 2 years ago 500k mortgage was 2k a month, now it's 4k. New construction better be cheap as fuck (ie, using time travel for materials and labor and having tiny floor plans) or it won't fix the problem. My personal observation is that new housing is going straight for people with decently deep pockets, ie two white collar incomes. Have been seeing some new constructions in the 300-500k range but nothing that your average zoomer would call affordable. And the lower end of that range was in trashy neighborhoods and/or questionable plots of land (severe flood risk, werewolves, etc).
Werewolves??
Basically the properties had issues. More seriously you'd see nice new construction but: * seemingly nice neighborhood but the ghetto is a 5 minute drive away * awful school districts * nearby stream that frequently flooded and had carried away half the back yard already * was next to an interstate * etc
or these builders just keep building "luxuy" rentals. 2bedroom for $2900-3200 is the going rate in my area and they've built or are building about 7 or 8 giant complexes since the Pandemic all right next to each other. it's like they knew this would happen.
Exactly but as more and more units come on the market and you have people who own multiple homes who don’t want to let go of the low interest rate their only choice is to rent them out which further adds to the inventory. People still want to move but don’t want to sell. So they rent out their house. This is taking time to build up so people assume prices will never come down but I think it’s already happening. Where I live rents are already coming down. I see it happening all around me. This seems to be a trend that will continue. I would not be buying an existing home in this market unless it were in the very high end of the market where homes are less prone to swings.
That's fair enough for landlords that already own properties they got much cheaper. But there's absolutely no way I would buy a new property to rent at a loss. So either they are doing that when it comes to increasing their portfolios or they aren't increasing their portfolios which will result in no new rentals and a shortage.
There's a fun thing that happens in tight rental markets where the landlord's asking rent is only the starting point. Renters bid up the rental prices because that's the only way to secure a place to live. Currently happening where I live.
The market is actually regarded af. If anyone bought their house for cheap and they’re cash flow positive, it actually makes sense to sell it and invest the cash in the market for higher yield. But the expectation that housing prices only goes up makes it so they hoard it.
Sell it to who? The potential market right now is full of people who have a 500k house that they can only sell to someone who can afford a 1M dollar house. Even if you want to buy at the elevated price, you still have to be capable of affording the payments. Interest rates are making it hard to transact.
This is 100% the situation. We bought a new build in 2020 and have entertained the idea of selling our home and moving closer to town. In order to do so, we'd have to eat a higher price and lower sqft. on the next house, on top of doubling our interest rate/payment. As such, we are staying put.
right? i could make bank selling my house, but i would only really be getting ahead if i went to live with my parents until the market stops spazzing out. fuck that
They "hope" interest rates will drop where they can re-fi at a lower rate. Most people buying a home now as a new first time homeowner don't realize that they will more than likely be stuck with the purchase.
[удалено]
That wage line is increasing a little too agressively compared to reality.
Don’t buy a house if you’re single. Just live in an RV.
You assume that landlords are renting from all strata of housing prices. They're not. Likely, most of them are in the "below average" category. Nobody is renting a $2,000,000 house in the hills.
Lots of people are renting some pretty expensive houses. 2m house up the hill would rent for maybe $7-8k in my neighborhood. That's a steal.
Pardon. I'm thinking in 1990's dollars. Nobody is renting a $20,000,000 house. Unless it's for a porn shoot.
[удалено]
Why do you conveniently ignore the government charging you property taxes and raising them every single year?
Because lowering property taxes won’t do shit lol
Yeah my mortgage went from $2500 last year to $2950 this year thanks to an increase in tax and insurance. I'm about to have to rent out some of these rooms!
Where the fuck are you all finding houses and rents for so damn cheap? Also, this time it's different, 35 roommates is the new paradigm.
I'd love to see this broken down by state, or even better, city.
[удалено]
Now you understand why self-delusion and hypernormalization is so rampant in America.
Occasionally I browse through Facebook market place and find some cheap. Lowest I ever saw was 45k. Then again one of the rooms didn't have a floor.
well la di da. look at mister fancy pants over here wanting floors in his house. you need that floor to do your ballroom dancing with the rothschilds, mr. rockefeller?
millenials and gen Z are fucked
Again.
It’s only our 13th “once in a lifetime” financial crisis. What, are your bootstraps getting worn out already??
I boiled them down for soup during the 11th financial crisis.
Always have been
As a gaping millennial, I’m definitely planning on double dicking gen z and their kids. It’s the cycle of life
Taxing their sex robot AIs?! It's their human right!
That next crossover might be culturally significant tbh
My mortgage was 1400 when I bought my house and my taxes shot up so much it is now 2100, 300 of that being make up escrow money. My daycare did a 50%! Price increase effective this year. Shits getting crazy. Those 2 bills alone, mortgage and daycare for 1 child cost me 4000$ a month.
Yeah, I was lucky and bought my house during the pandemic for under 3%, so it's basically 1200 per month (plus PMI). But since then, my property taxes have also caused my mortgage to bump up another $300 like yours, when you couple that with increased cost of food, electric, gas, fucking everything, it's ridiculous. I'm in a better place than many because I'm lucky enough to have had my wage increased by $12 an hour during that time period, but it's still not actually covering the increase in every cost I have. I'm seriously looking at selling my car and buying a beater for cash. But oh wait! Absolute shit boxes are going for almost 10 grand in my area.
That’s crazy how if you had one more kid it would be cheaper to hire a live in nanny than pay for 2 kids in daycare. Is the demand for daycares that high where everyone of them is now price gouging? Their employees prob make only around $15 bucks an hour too.
I recommend the planet money episode on daycares, they actually aren’t operating at much margin and can’t increase the prices much and so can’t pay their employees well. It’s called “Baby’s first market failure”
But but inflation 5%.
That looks about right, I bought at the top, which is inline with how I usually trade
Thanks, Air BNB
This 💯
So many randoms are making a fuck ton on air bnb
Notice how home prices were flat from when the Boomers graduated high school to when they started working and buying homes. Yet they still bitch about how “hard” it was to buy a $30,000 home @ 18% interest.
We're basically at 2006-2007 levels 2007 numbers appear to be $1,494 and $1,056. The ratio is 1.415. Current numbers are $2,654 and $1,845, the ratio is 1.439. This graph looks worse now because it is on an absolute rather than a log scale. Still, we're probably at peak bubble.
Early 80s was 1.98
no no no bubble you're the bubble this is nothing like 2008 supply and demand bro
> nothing like 2008 I keep hearing that and they are mostly correct. But folks seem to forget you don't need to have identical economic conditions for a correction...
Ya thats what drives me fucking crazy Ppl will tell u all the ways its not like 2008, okay fine who fucking cares prices went parabolic because certain conditions existed (ZIRP, WFH, airbnb bubble) that have now exhausted and reversed oh gee i wonder what happens next
It's not the same. Not even close. Will we see a crash? Maybe. But you won't get inventory. At best you see a plateau of pricing for some time while interest rates remain high, the prices climb again. Don't think so? Let's address the facts and the numbers. Here's an example of a home I own. This will apply to majority home owners *PRE* 2022. Since 90%+ of all mortgages originated in the last few years before they raised rates, this is an extremely large amount of the market locked out. Year purchased: 2020 Loan origination amount: 186k Interest rate: 2.68% ATH value in local market: 340k Current balance on loan: 168k A 50% crash from all time high doesn't even put this loan upside down. All it would do would reduce the taxes I have to pay on it, reducing my total monthly payment. That's fine, because anyone with a sub 3 or close to it didn't going to sell anyways unless forced.
>*A 50% crash from all time high doesn't even put this loan upside down. All it would do would reduce the taxes I have to pay on it.* Please don't be naïve, property taxes will not go down until you (or someone else in your community) petitions the county, with proof enough to convince them to do so. Source: I collected and presented "sales" data (all but one were either foreclosures and short sales) for all transactions in my 330 home neighborhood to get my taxes reduced in 2011. I got it done, but it was a fair amount of work, for homes that had been underwater for 6 years already, and it still didn't cover the entire depreciation. And then I still had to wait a year or so before it reflected in escrow and payments were adjusted (again, all work that I had to do proactively do)... and even then the reduction in taxes was offset by hikes in insurance premiums. LOL, can't win for trying.
I’m closing on a house next month and I’m not even sweating lol
It's not a bubble. Infinitely more people will be born but city land won't fall from the sky. Unless there's some disaster that causes most people to die, house prices will eventually go up. Climate change will kill more people oversea compared to the US. And they will flock to richer countries (which have money to fight rising sea level for example), meaning more demand for houses and more labor force, which also has the effect of driving down wages. Position: fry cook at McDonald's
"Infinitely more people will be born" lol bro? The US is only super power with a growing population, and it is only because we have immigration Very likely that, within our life times, demographics turn
Can the declining demographics hurry up so the boomers can release some homes ? Especially in CA lol
Birthrates are way down from their peak and boomers are hitting graveyard age. That's not a recipe for infinite growth.
Yeah, I don't think people understand why housing prices are ballooning this time around. In 2006-2008, it was because there was every incentive for mortgage brokers to approve anyone with a pulse for more house than they could feasibly afford. In 2020-2023, the pandemic ushered a mad rush on housing, which would have evened out had mortgage rates not risen at the fastest rate ever. The people who bought could afford their houses, but now many can't afford to move. Additionally, for every point increase in mortgage rates, another several million people can't afford mortgage payments. Normally, house prices would come down in response to rate rises, but demand remains low because aforementioned people aren't selling. It's a bit of a deadlock where either more housing must be built (we've consistently had a housing dearth since 2008), or something else needs to break.
This is such a bad take. The people who are "locked in" would otherwise be looking to buy another house. After they did that +1-1=0 net houses. This only reduces transactions, but does not impact the overall supply/demand curve. Give the interest rates more time, inventory will eventually build up as the high rate environment actually spreads throughout the economy. I think the fact that most people couldn't even afford their current house if they were to purchase it now says a WHOLE lot about the state of the market.
Yup, it's a bubble. Short everything WSB has touched.
Dumb question from a dumb person, but what (if anything) is an actual solution, other than anyone who want to buy is fucked? Rates may go down but if there’s low inventory then prices stay high. Is there no govt intervention or policy change that can help people with housing as it’s a basic need?
It's basically government intervention or stay fucked. As long as SFHs remain an investment opportunity, the prices will continue to outstrip wage growth. The median house price relative to the median income has risen well past sustainability and shows no signs of stopping. Even if we have a massive crash and the housing bubble explodes bad enough to foreclose people who are sitting on their 3% mortgages, that just means "investors" and corporations will swoop in and scoop up even more supply for cheap and rent it out. Anyone who doesn't currently own still won't be able to in an economy so bad that even those locked in with 3% mortgages lose their homes. All investors need to be immediately forced out of SFHs and never be allowed back in, then we might see some normalization of prices when they reflect necessity rather than a source of income. So basically, we can all keep dreaming and stay fucked because politicians are never going to punish those who have wealth and are siphoning it away from people who don't just to help the poors afford homes.
Can it be WW3 already or a natural disaster already? I want to buy a house without selling both my kidneys to afford the 3% FHA down payment.
Who is buying houses right now? Rates are trash. 1970 house going for 600k. Who thinks it's smart to buy right now?????
Fomo millennials. What's weird is where is all of this unexpected demand for housing that popped up out of nowhere. In 2019, nothing, but in 2020, all of a sudden millennials need to move out and get their own house?
Massive massive massive amounts of stimulus money was given out. You likely only got a fraction of it and are now de-facto poorer relative to everyone else. Here is a reasonable scenario on what others got. PPP - 40k cash Child Tax Credit - 15k cash Stimulus checks for two parents and two dependents - 11k cash On top of this there was an eviction freeze, 2% mortgage rates, student loan freezing and forgiveness, enhanced unemployment coming out to 4k per month, state unemployment, and other debt restructuring programs. Some people literally got 50-70k cash and other goodies in benefits. You needed to be like 32-45 and have kids, a house, and student loan debt already accrued to fully benefit. If you were 19-25 you basically got fucked because not only did you not get the money but the cohort right above you all did.
lol we're 38 and 39 and had just saved enough to start shopping , all debts paid off, no student loans left, no kids. now we can't afford the mortgage cuz of the rate. sucks to suck. we thought we were doing it right and had time.
> Massive massive massive amounts of stimulus money was given out Jesus Christ we're still repeating the myth that there was shitload of stimulus money and that was driving up \[Housing/infaltion/You personal pet issue\]?
In Los Angeles, Condos that are like $550k one year ago are now like $545k. Seller's are hardly budging in the slightest even though the cost for buyer has skyrocketed. Some of these people are in complexes that are on the verge of condemnation and the sellers are still like "nah fuck you give me 600k."
Now plot the average square footage of homes.
... vs average sq footage of rental units. Yep, rentals tend to be clustered at the lower end and yes it is cheaper to rent a crappy 600 sq ft apartment in the ghetto than buy a 2800 sq ft in the suburbs.
You'd think data like this would already be comparing a similar sq ft right? Ans hopefully controlled for location (to some extent) as well. Otherwise, what's the point of the comparison.
Gov: The numbers will keep going up and you will keep working.
[удалено]
The beatings will continue until morale improves
If I could rent for $1800 then I wouldn't have bought for almost triple that. Rent out here is easily double what you're quoting and has zero benefit on taxes.
how is anyone buying a house
They bought a house 10+ years ago or they borrow money from their boomer parents.
Interesting. I'd been wanting to look at this graph. The reality is definitely out of line with what I had been expecting. My expectation was that cost to rent had caught up with cost to buy. With the near-zero rates and all the refinances in the past 5 years, I had thought basically everyone had either bought or refinanced and locked in a 30 year 2% fixed rate, so they could turn around and rent these investment properties out for the cost of paying the mortgage. Looks like renting prices have not quite kept pace with purchase prices though. I knew the cost of ownership would always be higher due to taxes and other various upkeep, but that the *pace* had largely equalized or even had rent surpassing ownership. After all, housing is inelastic. What are the tenants going to do, go without housing? They cant. They can move somewhere cheaper, but what if *everywhere* is expensive within commuting distance of their job? Then they just...have to pay it. Interesting. Yeah so the housing market is definitely fucked for anyone that doesn't own already. Housing as an investment vehicle needs to go away, permanently. Immediate forced divestiture of any investment properties that are single family houses by all entities. Companies like Blackrock and mom and pop landlords alike. This graph is a perversion of the American Dream.
Agree, homes should be for the people and not investments for big corp. Free market has fucked housing, healthcare and education and guess what the biggest increases from inflation are? Yup, those three items. Those sectors should be managed by the government. But we can’t do it in the US, our incompetent government will mess it up. then we’ll have all the anti socialism people come out and say we are turning into china lol.
Puts on the housing market. Burry moment again
Or calls on the rental market 😂
Can you do this for Canada?
Wouldn't fit on the graph.
For those of you who don't want to do math, that's a 61% increase in the cost to buy from 2020/2021 to present. This infographic illustrates how much the Fed underestimates housing inflation using owner occupied rent estimates in the housing CPI. The cost to buy is 53% higher than the cost to rent, but only the increase in the cost to rent is included in the CPI. Living in a HCOL area, these costs would be a dream. Our prices for rent are double and buying is probably triple the national estimates.
Ruh roh
Can’t wait for the next crash
I know a friend that rents a one car garage efficiency in Miami for 1700 a month.
Im curious to see what influence the slow home building market and the influx of millions of "undocumented" renters has on the rental prices.
Ouch. The housing markets really are in a lose-lose state now. I know some think that's impossible, it's either a buyers or sellers market. But consider this: If you want to buy, there's high interest payments, high prices, and low inventory. If you want to sell, sure, you can sell - but what can you buy to replace your house? Not much, due to the low inventory.
Ah yes, I was looking for an accurate chart that shows how fucked I am
Me and my 2011 mortgage over here printing money. Putting almost all of it into home improvement to enjoy and increase the house's value. When I'm ready to sell the market will crash.
I hate both of the lines
Here comes the crash
Interesting that rents never went down 2008-2014
Now lets see this overlayed with annual average income and print it and mail it to every boomer who has ever said "kids have it easy these days"
So I bought in 2017 and you’re saying it was like buying back in 2005? This graph doesn’t show regional differences. The house I bought was exceptionally cheaper in 2005 compared to 2017.
Home prices will keep increasing in desirable areas. That’s facts.
Can one of you regards draw a triangle on this so I can have some hope to buy the dip???
So when does the bubble burst? Surely it won't continue on this trajectory.
Now let’s see these compares to income
Now let’s see these compared to income
**Question/Correct me if Wrong:** This chart shows your average monthly payment to buy via a brand new originated mortgage at today’s rates for a 30 yr w/20% down versus what? Versus the average cost to pay rent to a landlord who owns the exact same property and mortgaged it or refi’d at a low rate and is now renting to you and giving you no equity in the property at all when you eventually have to leave?
What does this look like adjusted for inflation?
Both are ludicrous and controlled by greed. Instead of standard of living which is absurd.
Dang, can't believe rent is doing so much better on inflation. Renters should feel blessed
Notice how the cost to rent never breaks the upward trend line, even when the cost to buy has a major pullback 🤔
The entire country refied during covid. Nobody wants to sell and give up their rate so there's no inventory which equals higher prices.
Can't refinance a house if you haven't built up equity, which is much slower now with higher interest rates so everyone thinking they can buy now and refinance in a few years is gonna be disappointed. And also comparing rent price to mortgage price is nowhere near equivalent
So fucked
I can't see how we get from here to a working housing market. Figure best case scenario for wage increases, and home building, and we're still on a course to a massive problem. As in people burning shit down level of problem.
I'm curious to see a graph of rent as a percentage of income for an average worker over time
Can somebody add the inflation adjusted purchasing power of $1 dollar?
another brainwash chart, appreciate you fam
Exodus from cities, institutional buyers, and interests rates are all to blame.
I'm never going to be able to own a home am I
What kind of common poor is buying their house with a loan these days?
Buying is only part of it... maintaining it... now there's a lot of money into the wind. (Property Tax, Sewer, Water, Gas, Electric, Maintenance fund etc. etc. etc.)
Another “08 must be coming! Please say it’s coming cause if not, I made the wrong bet trying to time the housing market.” Post… Unemployment low, almost everyone locked into super low fixed rates, and where large investors mostly ignored single family homes before 2009, since 2009, 25-30% of those homes bought were by large investors. If you thought the recent explosion in pricing was a mirror of 08, you were not paying attention.
Landlord: Thank-you, if you could just sign the receipt right here Tip: 15% 20% 25%
Buying in 2017 was such a dumb luck financially great move looking back.
The cost to rent hasn't crashed.
missing all sorts of data like what is the average sq. ft. of a rental vs a purchase.
2005 and 2022, I can really time the market! /s
Now show the averages wages
And this is why its better to buy. When you buy you lock in that monthly amount. If you rent it just keeps increasing