patrick.net

stereotomy says

Reagan was right. Eliminate federal funding of education, and let communities decide for themselves

Yeah, something akin to what those radicals codified in 1791 - “The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.”

https://www.reddit.com/r/FirstTimeHomeBuyer/comments/158xaeu/natural_death_3_years_ago/

I’m in escrow, and I found out that the condo I’m purchasing, the seller’s father passed in it in 2020

https://www.reddit.com/r/legaladvice/comments/158hrt1/buying_a_house_with_an_extremely_weird_easement/

Buying a house with an extremely weird easement that lets a stranger use our bomb shelter.

https://www.reddit.com/r/RealEstate/comments/158p1fy/bought_a_house_unknowingly_next_door_to_public/

Bought a House Unknowingly Next Door to Public Housing

Patrick says

Good. It is about time that borrowers, and not savers, pay the price for all that irresponsible borrowing.

https://www.hipporeport.com/en/new-living-show-share-hunting

I saw a plot on PDW showing the median price of new houses dropped below the median price of used houses for the first time ever.

I can't find it now and am not sure if it was legit.

@just_passing_through Here it is:

https://wolfstreet.com/2023/07/26/prices-of-new-houses-drop-below-prices-of-used-houses-for-first-time-since-2005-sales-languish-inventories-sky-high/

Patrick says

Here it is:

Thanks! I guess it's 2005 then. I was too busy playing around with my new generator to bother looking for it.

From a friend:

The question would be why new houses sell for less than existing.

I read somewhere that buyers tend to be on the market because they are looking at a lot of properties. This was said be true both in rising and falling markets. In rising markets you see a ton of bids on a house which may indicate that the seller could have listed it for more. In falling markets you see a lot of sellers turning down offers or sitting on a property for months trying to get the price that the place down the street sold for a year or two ago.

The argument would be that the new home builder being a forced seller, if they are taking less than the home owner who is not a forced seller, is a leading indicator of a falling market.

THIS ^^. I've seen more than a few examples of existing home owners go from selling to renting because they couldn't get the inflated price they wanted. And even with the renting they've still over-estimating market value.

Hopefully most of those people will remember a house is primarily a dwelling, not an asset. Otherwise they will be very unhappy as things continue to settle back down to earth...

Patrick says

The question would be why new houses sell for less than existing.

Do not forget if the builder is selling in a development, he has one big advantage - the builder likely has an on-site realtor who is not paid the 6% commission. Another advantage is the builder does not have to recoup "improvements" a homeowner may have done such an updated kitchen or landscaping. If the seller of the existing house originally bought within the last 4 years, there may not be enough appreciation to cover the old loan origination fees and points.

AmericanKulak says

Again, in my East Coast FL area, the stubborn ass old home owners - and I'm talking 1200 sq ft early-mid 60s spacerace boom houses on 1/5th acre, carport (no garage), a 2 bedroom with the sunroom enclosed (badly), with HVAC often added later and poorly (ie enclosed sunroom only has one small vent, will be 5-10F hotter than the rest of house) - $280-299k.

VERSUS

Brand new DR Horton $281-306k for genuine 3 bedrooms with another 200 sq ft under air (1400-1600) a decent sized master suite with walk-in closets, new everything inc. built in USB ports, brand new and not undersized later added Central HVAC, roof, etc. AND the Builders unlike the homeloaners/inheritance kids are covering closing costs. Granted, they're zero lots, maybe 6000 sq ft total, but they come with 2-car garages.

I still just can't imagine paying north of $2000/month for a 3 bedroom/2 bath house or having to come up with ~$50-60k down.

Knew I wasn't crazy



EDIT: Oops, thanks Rubicon
Rubicon says

Here ya go

just_passing_through says

I saw a plot on PDW showing the median price of new houses dropped below the median price of used houses for the first time ever.

I can't find it now and am not sure if it was legit.

HeadSet says

Patrick says

Good. It is about time that borrowers, and not savers, pay the price for all that irresponsible borrowing.

It’s sad that our Fed is reactive rather than proactive. The next time we hit recession, they’ll cut Fed fund rate down to 1% again, and the cycle continues. That’s my bet.

https://www.reddit.com/r/wallstreetbets/comments/15b8lwk/tales_from_a_401k_administrator/
TL;DR- Hardship withdrawals are up to pay mortgages.

1337irr says

https://www.reddit.com/r/wallstreetbets/comments/15b8lwk/tales_from_a_401k_administrator/
TL;DR- Hardship withdrawals are up to pay mortgages.

What makes you think these people don’t use hardship as an excuse to take money out of their 401k and gamble on the stock market options?

Eman says

1337irr says

https://www.reddit.com/r/wallstreetbets/comments/15b8lwk/tales_from_a_401k_administrator/
TL;DR- Hardship withdrawals are up to pay mortgages.

What makes you think these people don’t use hardship as an excuse to take money out of their 401k and gamble on the stock market options?

https://finance.yahoo.com/news/foreclosures-rising-experts-means-housing-180030618.html

1337irr says

Eman says

1337irr says

https://www.reddit.com/r/wallstreetbets/comments/15b8lwk/tales_from_a_401k_administrator/
TL;DR- Hardship withdrawals are up to pay mortgages.

What makes you think these people don’t use hardship as an excuse to take money out of their 401k and gamble on the stock market options?

https://finance.yahoo.com/news/foreclosures-rising-experts-means-housing-180030618.html

From your article:

“Even though foreclosures are spiking, it’s not the big deal everyone is making it out to be. We are just reaching a more normal level of foreclosure filings,” said Brian Wittman, owner/CEO at SILT Real Estate and Investments.

“According to ATTOM, there were approximately 150,000 foreclosure filings in Q1 of 2019,” Wittman said. “There are still only roughly around 100,000 in Q1 of 2023. It is a rise year over year of approximately 10%. It still doesn’t appear to be the issue everyone thinks it will be.

Just putting things in perspective.

- The rate for early-stage delinquencies – defined as 30 to 59 days past due – was 1.4% in April 2023, up from April 2022. The share of mortgages 60 to 89 days past due was 0.4%, up from April 2022.

- Over the 2005 to 2008 period, delinquency rates rose from around 5 to over 22 percent for subprime mortgages on investor - owned properties, compared with a rise from 5 to around 18 percent for owner-occupied properties.

We’re not quite there…yet compared to the last housing bubble.

Eman says

It’s sad that our Fed is reactive rather than proactive. The next time we hit recession, they’ll cut Fed fund rate down to 1% again, and the cycle continues. That’s my bet.

Fixed:
The next time we hit recession, they’ll cut Fed fund rate down to 0% again

https://apnews.com/article/personal-finance-off-the-charts-transunion-los-angeles-business-223a7be57d988912ee2cbb9b46096e34

More homeowners tap equity juiced by soaring prices

https://fortune.com/2023/07/27/housing-market-institutional-freeze-invitation-homes-net-seller-wall-street-real-estate/

Housing market institutional freeze: Invitation Homes—the largest owner of U.S. homes—was a net seller for the third straight quarter

Eman says

It’s sad that our Fed is reactive rather than proactive. The next time we hit recession, they’ll cut Fed fund rate down to 1% again, and the cycle continues. That’s my bet.

You assume they're being reactive because you see their role as preserving the economy. But if you see examine the outcome of every Fed action without this assumption, you will quickly realize their role is very different.

AmericanKulak says

Knew I wasn't crazy

Looking at the last crash, used is what had a significant drop, and new really didn't move down that much at all. If that trend follows this time around, used has a LONG way to go, as new is dropping precipitously already.

Cardboard box sales have dropped 20% in the first two quarters, most since 2009. But I'm sure those house prices are fine...

NuttBoxer says

Cardboard box sales have dropped 20% in the first two quarters, most since 2009. But I'm sure those house prices are fine...

Could you please expand on that? What kind of cardboard boxes sales have dropped? CPG? Moving? Industrial? Budweiser?

Anecdotal, but I have using Zillow for a while to look at single family homes in Va and NE and have notice plenty of price drops during the last two weeks of July. Also, I see developers are selling off their lots to the public because apparently builders are not buying those lots. The prices have not fallen enough to make up for the rapid rise of the last few years, at least not yet.

1337irr says

Could you please expand on that? What kind of cardboard boxes sales have dropped? CPG? Moving? Industrial? Budweiser?

The number is from companies who make boxes for everything and anything. Boxes are used to ship products. Less products ordered, less boxes. If you want more than that:
https://www.zerohedge.com/economics/big-drop-cardboard-box-sales-scream-recession

Also Yellow just went under, always a sign of economic strength when the largest LTL in the country goes belly up!

Rubicon says

“Seeing plenty of price drops” is like “I think it’s going to rain at some point.”

I have no detailed analysis, just see lots of these:

Rubicon says

That’s the first rookie mistake. No crash ever happens in the same fashion as circumstances/parameters change. Tired of explaining for the millionth of time why this time is different. Sadly, you will likely never own an house and remain a life long renter stuck in the “but it has to crash” circle.

Nope.

Demographics. Boomers are now almost entirely over 65.

You always have time to hold out when you think you've got many years of stroke-free, chronic-illness free life yet. After 65, you're a slip or a stroke away from Assisted Living, or at least a 1st Story only smaller place. When you can no longer climb stairs with ease, selling may be out of your hands as much as your fork now is. And your kids might sell it to pay for that assisted living senior community.

Rubicon says

NuttBoxer says

1337irr says

Could you please expand on that? What kind of cardboard boxes sales have dropped? CPG? Moving? Industrial? Budweiser?

The number is from companies who make boxes for everything and anything. Boxes are used to ship products. Less products ordered, less boxes. If you want more than that:
https://www.zerohedge.com/economics/big-drop-cardboard-box-sales-scream-recession

Zerohedge….aka the sky is falling….ALWAYS!

+ Reventure Consulting.
However, I see rain in the forecast.

Rubicon says

Nice looking houses! Those are >1M USD in SoCal.

They soon will be!

Yet, at the same time, year-over-year sales of new homes surged by 23.8% while existing-home sales sagged.

“With low existing home inventory, new home inventory is becoming competitive, and new homes are now competitive on price,” said Robert Frick, corporate economist with Navy Federal Credit Union, in an emailed statement. “The premium for a median-priced new house versus an existing house is now only $5,000.

In October 2022, the median sales price for a new home was $496,800, while the median existing-home sales price was $378,800—a difference of $118,000. This gap has since narrowed by roughly 96%.

https://www.forbes.com/advisor/mortgages/real-estate/housing-market-predictions/

Knew I wasn't crazy about seeing the new houses go for not much more than the used housing. Browsing Zillow weekly is useful to get a snapshot.

If inventory is so limited, why is the gap between new and old so small? If the housing market isn't doing badly, why are builders trying to bail out despite having a pricing advantage?

HeadSet says

Rubicon says

“Seeing plenty of price drops” is like “I think it’s going to rain at some point.”

I have no detailed analysis, just see lots of these:

Simply amazing how cheap they could build in the Midwest and South compared to California.

These houses are over $2M here in North San Jose and on tiny lots too.

https://redf.in/fo6KKF

Smaller house. Built on tiny zero lot line with no driveway. Sold for $1.95M last month, and with $336/month HOA dues too.

https://redf.in/oI7Edl

Eman says

Smaller house. Built on tiny zero lot line with no driveway. Sold for $1.95M last month, and with $336/month HOA dues too.

https://redf.in/oI7Edl

It's by H-Mart. That's why it sold for such a high price.

Eman says

Simply amazing how cheap they could build in the Midwest and South compared to California.

These houses are over $2M here in North San Jose and on tiny lots too.

What we're gonna build would be $3M+ probably. Getting bids and nearing $700k. We're gonna suck it up even with high interest rates. Midwest is on paper technically cheap as hell. You can get 2,200 builder grade homes for $250k still. They suck. But it's a house and forced saving for those less disciplined.

I'm just done living in my 20's. I can afford a nice house. Kids ages and work circumstances we'll be at home a lot more. We'll probably keep it till we die or hand it down to our kids. If a crash hits we'll just buy shit up. We have the cash. I kind of want a crash. Not buying a boomer house though (not a dig at boomers though they were 100% the cause of 2006-8). So we're gonna build. Dragging our feet, but we'll get it done.

Life is complicated. You live it once. I have no interest ever in being beholden to a landlord. I want to own my property. I don't even care about prices or anything. I care about knowing I have a place to go. And thing is anyone that's not a deadbeat can go and get a job for $50-60k per month tomorrow. They're out there. There's no excuse to cry poor or say housing will crash. It might. Take advantage of it and prepare to be in that position. No one factors in moving expenses and time lost from work as a renter/ That's part of your rent. It's expensive and time consuming.

Though I'll say don't own a home if you don't know shit about repairing anything. You have to have some mechanical and trades skills. Which I think is the case with many anti owner people. They expect it to be repaired and handled. Guess what your rent goes up. Raising rents is easy. You making more money might not be depending on your work. There's not choice in it. You beholden to another person/management company. That SUCKS.

https://redf.in/fo6KKF


Shoot me in the head. That is ugly as fuck.

Patrick says

Awesome!