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https://nitter.net/Not_Jim_Cramer/status/1453440421430919172#m
Not Jim Cramer
@Not_Jim_Cramer
13h
Why would margin debt and home prices have a 96% correlation?
Because they're both risk-on responses to Fed Policy (courtesy @hedgopia).
https://nitter.net/pic/media%2FFCunx1iUYAQiFWd.png
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Lending Tree
Short housing. Short banks. Then sit back, grab the popcorn and watch the movie.
GreaterNYCDude saysShort housing. Short banks. Then sit back, grab the popcorn and watch the movie.
Really? Is Michael Burry shorting the housing market this time? Nope, he’s been shorting TSLA and getting his ass kicked.
Home prices have been going up due to the lack of inventory coupled with super low interest rates and people have been making money from the stock market especially in the Bay Area. It’s the law of supply and demand.
It will be a slow bleed this time around. No crash
And the fucking lenders really crawl up your ass this time to check whether you really-really capable of paying the fucking mortgage. I've just went through a refi - a refi! - which lowered my payments w/o cash-out or extending the length of the loan and they still put me through the ringer. I even had to write statements asserting that I have no financial interest in the houses I rented 10-15 years ago! It's a fucking madness.
I am a real estate photographer in the DC area. I just had my first conversation with an agent about signs of a "changing" market. She said appraisals are starting to come in low. Some first time buyers have had to come up with significant cash to make up for low appraisals. One of her first time buyers had to come up with an additional $63,000 or they would have 1) lost the house and 2) lost their earnest money. However much that was, I do not know...didn't ask.
WineHorror1 saysI am a real estate photographer in the DC area. I just had my first conversation with an agent about signs of a "changing" market. She said appraisals are starting to come in low. Some first time buyers have had to come up with significant cash to make up for low appraisals. One of her first time buyers had to come up with an additional $63,000 or they would have 1) lost the house and 2) lost their earnest money. However much that was, I do not know...didn't ask.
Earnest money is like 3% of the contract price. Buyer waived the appraisal contingency. That’s why they cannot use it to renegotiate the price. Seller knew appraisal would likely not going to come in so they asked the buyer to waive it.
Her take on it was that the banks are starting to tighten up.
I won’t get into why the appraisal didn’t come in at contract price.
Eman saysI won’t get into why the appraisal didn’t come in at contract price.
Long ago, when I was buying real estate, I noticed that appraisals always came in for exactly asking price. If the appraisal was above asking price, it would anger the banker. If the appraisal was below asking price, it would anger the realtor. No appraiser would do an appraisal without knowing the asking price. Things apparently have changed.
a bill that would put valuations in the hands of the government.
No appraiser would do an appraisal without knowing the asking price.
HeadSet saysNo appraiser would do an appraisal without knowing the asking price.
Then you have a shitty Realtor on your hands.
Appraisers are scum - the industry is full of fraud.
I noticed that appraisals always came in for exactly asking price.Out here in crazy silicon valley, houses often sell for well above "asking" price since that price is set artificially low to create a bidding war. So, houses appraise for exactly the sale price, not the asking price. That's fortunate because, otherwise, buyer would have to make up the difference at closing. My shack was $720k asking and I paid $770k. My appraisal for the loan came in at precisely $770k, which is exactly what my real estate agent said would happen. In some ways, I guess if a house sells for some amount, then that should be the likely appraisal, since that's what the market will bear.
HeadSet saysI noticed that appraisals always came in for exactly asking price.Out here in crazy silicon valley, houses often sell for well above "asking" price since that price is set artificially low to create a bidding war. So, houses appraise for exactly the sale price, not the asking price. That's fortunate because, otherwise, buyer would have to make up the difference at closing. My shack was $720k asking and I paid $770k. My appraisal for the loan came in at precisely $770k, which is exactly what my real estate agent said would happen. In some ways, I guess if a house sells for some amount, then that should be the likely appraisal, since that's what the market will bear.
Actually even if they simply stopped buying MBS (assuming that they haven't already??)They did... Phased it out 40billion a month early in Mar. MBSs best recover and get above that trend line or several pts will be added to Mortgagee loans.
Demand looks like it dropping, but supply is so low that it's hard to tell.
With higher rates, supply might drop because people can't afford to move out of their old home, freeing up something for sale. If you're in a 30-year mortgage at 4% and sell to move somewhere else, you won't be able to afford a similar house at 5%.True if people keep their salaries and jobs. If we enter a job-loss recession, watch out below.
Demand looks like it dropping, but supply is so low that it's hard to tell.
joshuatrio saysDemand looks like it dropping, but supply is so low that it's hard to tell.
It's said there is a 10% non occupancy rate in Silicon Valley - homes that aren't occupied, purchased exclusively as an investment.
This is a ponzi scheme.
Chinese people buy apartments in China for investment purposes - but they basically have to pay the place off in like 3 YEARS. Here, it can be 20-30-50 years.
It's said there is a 10% non occupancy rate in Silicon Valley - homes that aren't occupied, purchased exclusively as an investment.
So some companies have come up with this fix where they say they'll buy the house with cash and wrap up the loan part with you later.
They show they have the cash in the POF. They waive the financing contingency. As long as they close with CASH by the closing date, who cares if the cash is coming from a lender, or their bank account?
they probably bloat the "cash buyer" stats that supposedly make the housing market look more sustainable
From the sellers perspective, these fake cash loans should be fine. But they probably bloat the "cash buyer" stats that supposedly make the housing market look more sustainable than it really is. I'm also guessing that these fake cash loans people have very little or no equity.
Booger saysFrom the sellers perspective, these fake cash loans should be fine. But they probably bloat the "cash buyer" stats that supposedly make the housing market look more sustainable than it really is. I'm also guessing that these fake cash loans people have very little or no equity.
Unless they fake the POF (Proof of Funds), the equity is real. Buyer will bring the cash to close if they can’t get the loan within the specified time frame. There’s no reason to pay all cash. Then refinance to pull out the equity and pay 2 closing costs.
I operate in this space so I know. We offer $3M cash with no loan contingency. We show our POF. We have the right to obtain a loan within this time frame to close the deal. If for whatever reason we can’t obtain the loan, we’ll bring in the cash to close. Loan hiccup happens. Happened to us a couple times, but we have a portfolio lender who can close ...
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You Chose To Buy A Home That You Can’t Afford
August 26, 2021Ben JonesUncategorized133 Comments
A report from the Atlanta Journal Consitution in Georgia. “The metro Atlanta housing market clicked into balance in July: Supply met demand and home prices stopped their rapid rise. About 12,300 homes were listed for sale last month. In the city of Atlanta, home prices are up 20% from a year ago, according to Bill Adams, president of Adams Realtors. But the change in price ranges from a decline of 3% in Candler Park to a leap of 36% in Inman Park, he said. The trend of higher prices is going to continue because there won’t be a large increase in homes listed for sale, he predicted.”
From Market Watch. “‘Although housing is expected to remain sturdy for some time, several key gauges are cooling as the pandemic-induced buying frenzy eases and elevated prices cut into affordability, particularly for first-time homebuyers,’ Priscilla Thiagamoorthy, an economist with BMO Capital Markets, wrote in a research note.”
The Chicago Tribune on Illinois. “Seneca Oaddams, 44, bought his two-flat in Roseland for $132,000 a little over two years ago. The property, which he purchased as an investment and rental property, now has an estimated worth of $250,000, according to Redfin. But having endured 17 months of the pandemic, Oaddams says it’s hard to hold on to the building. His tenant, whose rent covers approximately half of Oaddams’ monthly mortgage, lost her job at the start of the pandemic and hasn’t been able to keep up her payments.”
“‘I’m actually hopeful for the future,’ Oaddams said. ‘I’m hopeful that it’s going to get better. … It needs to get better. Who doesn’t want to own property? Why not be able to help someone as well and lessen the load on your pocket with a building, so it’s a win-win for the renter and the tenant? The problem is when the rent can’t get paid.'”
The Norwich Bulletin in Connecticut. “Mark Kulos, president of the Norwich Property Owner’s Association and a landlord with 27 units, said while there are ways today for landlords to evict people, most won’t try because a misstep under the federal moratorium can lead to heavy fines. Kulos said this affects ‘mom and pop landlords,’ who have day jobs and have an operation of 50 units or smaller, as the landlord still has to pay for mortgage, taxes and upkeep without making a profit. ‘(The landlords) are working their other jobs to pay their bills, especially if the tenants aren’t paying,’ he said.”
From CBS DFW in Texas. “Clint Cash owns a handful of rental properties in the Dallas-Fort Worth area, some of whom have tenants impacted by the pandemic. Cash and other rental property owners believe the eviction moratorium that the Centers for Disease Control and Prevention enacted last year has gone on for too long with an expanding job market making it easier for people to find work. Cash says he’s sympathetic to those who still can’t pay their bills, but he says the government has put landlords in a position where they can’t either.”
“‘There’s not enough profit in it for these mom and pops to continue and pay their own bills and so they will lose their houses and those houses will thus go to foreclosure,’ he said.”
The Steamboat Pilot in Colorado. “Before casting their votes, members listened to nearly two hours of public comment from dozens of residents, most of whom were short-term rental owners, property managers or property owners who spoke in favor of short-term rentals. Michelle Williams bought her home on Bear Creek Drive in 2018, with a plan to retire in the home one day. Williams said she and her family spent four months in the home in 2020 and supported the city’s economy during the COVID-19 pandemic.”
“To supplement the cost of owning the home until she can retire in it, Williams rents her home out to nightly renters when she is not living in it. ‘We spent an absurd amount of money downtown, as we dined out almost every night,’ Williams said. ‘We’re really good people, and we want to do the right thing and abide by rules and regulations set forth.'”
“Debby Spiker, a resident on Meadow Wood Court, said she understands many property owners need to cater to short-term renters to help pay for their homes, but that choice infringes on her quality of life. ‘I’m hearing a lot of self interest and financial ‘woe is me,’ Spiker said. ‘It’s not my fault that you chose to buy a home that you can’t afford without renting it out to carry the cost.'”
“Spiker said nightly renters have brought ‘destruction’ into her neighborhood — as nightly renters are often loud, do not pick up trash and may cause other issues in neighborhoods traditionally home to full-time families and working residents. ‘I get you want to monetize your home, but it affects me personally,’ Spiker said.”
The New York Post on California. “There is really nothing Kate Beckinsale can’t do, including sell her longtime Los Angeles home after only weeks on the market. The Brentwood property, which was listed on Aug. 2 for $3.995 million, is already in contract after it found a buyer on Aug. 20, The Post has learned. The English-born actress has enjoyed a 15-year run in the four-bedroom, five-bathroom pad she purchased for $3.595 million in 2006.”
“But this also means that she won’t be leaving with that much of a profit, considering renovation projects over the years and broker fees.”