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Is it time to put a price cap on the real estate market?

By Patrick following x   2018 May 17, 8:37pm 356 views   6 comments   watch   sfw   quote     share    


https://born2invest.com/articles/price-cap-real-estate-market/

Prices are slowing or backing off on the high end. Hot markets have gone from $10 million plus to $5 million plus. Manhattan condo sales have plummeted to a six-year low. The biggest drops are in the high-end townhouses that foreign buyers most prefer.

The number of landlords offering incentives on leases rose from 25 percent in August 2017 to 50 percent in December as the number of new leases dropped from 7,500 to 4,200.

In January, house prices in London fell 2.6 percent year-over-year, while the posh, centrally located Wandsworth borough fell 14.9 percent. That’s the fastest rate of decline since the financial crisis.

And in the fourth quarter of 2017, San Francisco lost more people than any city in America.

Forty-nine percent said they could consider moving out of that $1.5 million median home. It would take a $303,000 annual income with a $300,000 (20 percent) down payment to afford that.

How many people have that kind of income, even in high-income San Francisco?

Only 12 percent of residents can now afford that.
1   TrumpingTits   ignore (0)   2018 May 19, 6:20pm   ↑ like (1)   ↓ dislike (1)   quote        

For the Bay Area, the simplest thing to do is make it illegal for H1-B visa holders to take out mortgages and for H1-B holders with mortgages already to pay them off as part of a requirement for them to either get the H1-B renewed or to get citizenship.

Patrick says
How many people have that kind of income, even in high-income San Francisco?

Only 12 percent of residents can now afford that.

With the new Who Cares If You Don't Have Enough Income? We Don't Verify It Anyway 3% down Freddie Mac loans, it doesn't matter. Welcome to America!
2   Strategist   ignore (1)   2018 May 19, 6:37pm   ↑ like (1)   ↓ dislike (0)   quote        

Patrick says
Forty-nine percent said they could consider moving out of that $1.5 million median home. It would take a $303,000 annual income with a $300,000 (20 percent) down payment to afford that.

How many people have that kind of income, even in high-income San Francisco?

Only 12 percent of residents can now afford that.


You can substitute lower income with a higher down payment. Lots of people do have large amounts of cash they can put down. Some 20% buy with all cash.
3   Strategist   ignore (1)   2018 May 19, 7:15pm   ↑ like (0)   ↓ dislike (0)   quote        

Patrick says
And in the fourth quarter of 2017, San Francisco lost more people than any city in America.


When I was in Florida last month, so many of the locals stated they wanted to move to Southern California. They were not happy living in Florida for one reason or another, even though they were freaked out about the home prices in So California. And here I am, touting Florida as the best place to move to, because I see Florida to be a bargain with a tremendous potential. I guess the other side always looks greener.
4   Hircus   ignore (0)   2018 May 20, 12:50pm   ↑ like (0)   ↓ dislike (0)   quote        

WarrenTheApe says

For the Bay Area, the simplest thing to do is make it illegal for H1-B visa holders to take out mortgages and for H1-B holders with mortgages already to pay them off as part of a requirement for them to either get the H1-B renewed or to get citizenship.


I think that would just shift their demand to rentals. And, these H1-B homeowners would likely rent a home, and an American would buy the home to rent it to them, and so housing demand would stay fairly similar, IMO.

Well, maybe. The price to rent ratios in the tech areas make it hard to cashflow a SFH. The landlord would need to accept a rent that doesn't cover their expenses, in hopes that they make it back in appreciation. SOme would make that bet, but not all, so maybe it would lower home prices a bit (but then rents would certainly rise).
5   TrumpingTits   ignore (0)   2018 May 20, 4:53pm   ↑ like (0)   ↓ dislike (1)   quote        

Hircus says
SOme would make that bet, but not all, so maybe it would lower home prices a bit (but then rents would certainly rise).

Rents are already high because of H1Bs. Entire sections of apartment buildings are rented en block by the H1-B visa 'sweat shops' (which legally should not exist, period), in fact.
6   APOCALYPSEFUCKisShostikovitch   ignore (30)   2018 May 20, 4:55pm   ↑ like (0)   ↓ dislike (0)   quote        

As long as there is one human being left in AMERICA! that can afford to live indoors, value is being left on the table that should be claimed by investors.

Real estate has not come close to achieving its true value in AMERICA! or anywhere else.




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