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housing prices peak 2
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2022 Apr 29, 9:29pm 601,838 views 5,636 comments
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3908
Blue
2023 Dec 9, 9:33am
GNL says
This is what I have been suspecting all the time. Never trust the gov "help" crap. Every action of their "help" to poor and middle class, eventually comeback and bite both of them in the form of delayed stealth tax aka inflation on average in 18 months depends on how it was structured. Only rich, upper middle can dodge by keeping wealth in non cash forms like stocks, RE, particularly cheap loans to leverage etc.
Also like @WookieMan says, CA is beyond the repair with 1978 Prop 13 and its so many derivatives in place over the period for rich commies along with so many CA commie craps particularly in major urban areas.
Rest of the state and country is on a different side and can go down as well but hard to think that it can crash with the given nn% inflation!
40% of all dollars in existence printed in the last 3-1/2 years.
This is what I have been suspecting all the time. Never trust the gov "help" crap. Every action of their "help" to poor and middle class, eventually comeback and bite both of them in the form of delayed stealth tax aka inflation on average in 18 months depends on how it was structured. Only rich, upper middle can dodge by keeping wealth in non cash forms like stocks, RE, particularly cheap loans to leverage etc.
Also like @WookieMan says, CA is beyond the repair with 1978 Prop 13 and its so many derivatives in place over the period for rich commies along with so many CA commie craps particularly in major urban areas.
Rest of the state and country is on a different side and can go down as well but hard to think that it can crash with the given nn% inflation!
3909
B.A.C.A.H.
2023 Dec 9, 5:26pm
B.A.C.A.H.
2023 Dec 9, 5:26pm
PumpingRedheads says
I dunno Who The Heck you're referring to.
I've been following Patrick's site since 2006. At the time I was in a cubicle warren in the Trenches of (Silicon Valley) Tech with like-minded local housing skeptics like me (and Patrick).
Patrick began his SFBA-focused, SFBA-centric blog with a (healthy) skepticism about the SFBA Housing B*llshit. Yes, it is true, if Patrick and my office mates had paid (or borrowed for) peak prices in 2006, they'd have a lot of equity now (unless they used the equity as an ATM like so many of my Bay Area homies have done). They also would have pissed away massive amounts of their income on Super-High Property Taxes, which are now (2023) insane for new buyers.
There's a whole lot of us with deep roots in the SFBA (I grew up here) who just endure the high rents or house prices as the trade off we accept for living among our relatives, friends, etc. It's not a Left-Wing political stance, - some of us dislike those folks as much as you do. It's personal, - ;like the Jews who stayed in early 1930's Germany in spite of everything. Call us names, belittle us, etc, - whatever. Sticks and Stones. But please don't hate us.
BUT the Housing Experts of PatNet (which I note haven't commented on this for at least 18 mos) insisted this would never happen!
I dunno Who The Heck you're referring to.
I've been following Patrick's site since 2006. At the time I was in a cubicle warren in the Trenches of (Silicon Valley) Tech with like-minded local housing skeptics like me (and Patrick).
Patrick began his SFBA-focused, SFBA-centric blog with a (healthy) skepticism about the SFBA Housing B*llshit. Yes, it is true, if Patrick and my office mates had paid (or borrowed for) peak prices in 2006, they'd have a lot of equity now (unless they used the equity as an ATM like so many of my Bay Area homies have done). They also would have pissed away massive amounts of their income on Super-High Property Taxes, which are now (2023) insane for new buyers.
There's a whole lot of us with deep roots in the SFBA (I grew up here) who just endure the high rents or house prices as the trade off we accept for living among our relatives, friends, etc. It's not a Left-Wing political stance, - some of us dislike those folks as much as you do. It's personal, - ;like the Jews who stayed in early 1930's Germany in spite of everything. Call us names, belittle us, etc, - whatever. Sticks and Stones. But please don't hate us.
3910
FortwayeAsFuckJoeBiden
2023 Dec 9, 5:47pm
Eman says
our area gone down, but we still get people escaping cities so keeps prices up unfortunately. was hoping they’d stop buying at inflated prices. locals can’t afford what equity people can.
Wookieman,
It’s great that you’re okay. Do you know what caused you to have a seizure?
In my market, agents/brokers get all these sources and reach out to the trustees/executors/owners on a daily basis. I can see rural areas are less targeted by agents/brokers compared to the metros and suburbs.
our area gone down, but we still get people escaping cities so keeps prices up unfortunately. was hoping they’d stop buying at inflated prices. locals can’t afford what equity people can.
3911
DOGEWontAmountToShit
2023 Dec 9, 6:30pm
DOGEWontAmountToShit
2023 Dec 9, 6:30pm
B.A.C.A.H. says
Funny. You missed the whole BS from the 'Housing Experts' about two-three years ago. I an others said that a) the era of low interest rates were ending and b) housing prices would drop as a result. In response, they responded patronizingly that we didn't know what we were talking about, that it would NEVER HAPPEN and they were the EXPERTS!. Normalcy Bias on steroids.
Vast majority of those losers have not been active on here since their bullshit was exposed.
Where the hell were you Mr. I've Been On PatNet Since '06 during all this?
I dunno Who The Heck you're referring to.
Funny. You missed the whole BS from the 'Housing Experts' about two-three years ago. I an others said that a) the era of low interest rates were ending and b) housing prices would drop as a result. In response, they responded patronizingly that we didn't know what we were talking about, that it would NEVER HAPPEN and they were the EXPERTS!. Normalcy Bias on steroids.
Vast majority of those losers have not been active on here since their bullshit was exposed.
Where the hell were you Mr. I've Been On PatNet Since '06 during all this?
3912
WookieMan
2023 Dec 9, 6:45pm
WookieMan
2023 Dec 9, 6:45pm
PumpingRedheads says
At no point have I ever read here that interest rates wouldn't rise by a single user. You're flat out lying man.
And point B, higher interest rates have not resulted in price drops in most of America. Just some cities and hipster areas the Californians fled to. Notice a theme here?
No one has to be an expert in RE to understand basic data. CA will drag down national numbers and people will claim it's a crash. It's not. It's CA correcting itself and you make claims based off that. Prices have not gone down in fly over country. There's no inventory. Almost all listings are fixer uppers. This is why I hate when one giant state projects what they think is reality on the majority. It's no different than gays pretending their lifestyle is normal. It's not and no one thinks that. You're gay and weird.
I an others said that a) the era of low interest rates were ending and b) housing prices would drop as a result.
At no point have I ever read here that interest rates wouldn't rise by a single user. You're flat out lying man.
And point B, higher interest rates have not resulted in price drops in most of America. Just some cities and hipster areas the Californians fled to. Notice a theme here?
No one has to be an expert in RE to understand basic data. CA will drag down national numbers and people will claim it's a crash. It's not. It's CA correcting itself and you make claims based off that. Prices have not gone down in fly over country. There's no inventory. Almost all listings are fixer uppers. This is why I hate when one giant state projects what they think is reality on the majority. It's no different than gays pretending their lifestyle is normal. It's not and no one thinks that. You're gay and weird.
3913
EBGuy
2023 Dec 9, 8:49pm
I'm sure the Fortress will fall, but we've still had some listings going for over $1,400 /sq.ft. Crazy times. I guess that Albany fixer posted by eman is a sign of things to come (investors exit, stage right...)
3914
DOGEWontAmountToShit
2023 Dec 9, 8:56pm
DOGEWontAmountToShit
2023 Dec 9, 8:56pm
WookieMan says
That's funny.
You were one of them.
no point have I ever read here that interest rates wouldn't rise by a single user. You're flat out lying man.
That's funny.
You were one of them.
3915
Eman
2023 Dec 9, 10:52pm
Eman
2023 Dec 9, 10:52pm
EBGuy says
@EBGuy,
You won’t believe what the seller has in mind. Offer $650k cash and he “might” accept it. Otherwise, he’ll tear it down. Who’s the shark here?
Folks love to blame things on “the flippers/investors” while being clueless about what’s happening behind the scene.
I'm sure the Fortress will fall, but we've still had some listings going for over $1,400 /sq.ft. Crazy times. I guess that Albany fixer posted by eman is a sign of things to come (investors exit, stage right...)
@EBGuy,
You won’t believe what the seller has in mind. Offer $650k cash and he “might” accept it. Otherwise, he’ll tear it down. Who’s the shark here?
Folks love to blame things on “the flippers/investors” while being clueless about what’s happening behind the scene.
3917
Eman
2023 Dec 9, 11:06pm
Eman
2023 Dec 9, 11:06pm
EBGuy says
I’m surprised the market has held up so well. We had lunch with our lender last week. Apparently, banks are going through their borrowers’ portfolios and stress test them. He told us our portfolio is fine. We should be able to handle to shock of higher interest rates when it’s time to refinance aka the loans balloon.
If the portfolio is weak, they would prepare the borrowers to either “prepare for cash-in, or consider dispose/sell the asset before the loan comes due.”
This 12-unit building (two 6-unit buildings side by side) recently got taken back by the lender. It’s a syndication deal. All investors get wiped out. No idea what this syndicator was smoking paying $3M for it. https://redf.in/tvJEgy
There are a couple more buildings by the same syndicator, where the lender is forcing the sale. They’re on the market. Can’t disclose them.
I'm sure the Fortress will fall, but we've still had some listings going for over $1,400 /sq.ft. Crazy times. I guess that Albany fixer posted by eman is a sign of things to come (investors exit, stage right...)
I’m surprised the market has held up so well. We had lunch with our lender last week. Apparently, banks are going through their borrowers’ portfolios and stress test them. He told us our portfolio is fine. We should be able to handle to shock of higher interest rates when it’s time to refinance aka the loans balloon.
If the portfolio is weak, they would prepare the borrowers to either “prepare for cash-in, or consider dispose/sell the asset before the loan comes due.”
This 12-unit building (two 6-unit buildings side by side) recently got taken back by the lender. It’s a syndication deal. All investors get wiped out. No idea what this syndicator was smoking paying $3M for it. https://redf.in/tvJEgy
There are a couple more buildings by the same syndicator, where the lender is forcing the sale. They’re on the market. Can’t disclose them.
3918
WookieMan
2023 Dec 9, 11:09pm
WookieMan
2023 Dec 9, 11:09pm
PumpingRedheads says
At no point did I say interest rates won't rise ever. That's fact. What I've always said is a rise won't matter if there's still no inventory. I'm not wrong. You're conflating the two ideas. Interest rates rose and it didn't matter. Cherry pick San Francisco, fine. I said cities would eat shit, I was 100% right. I don't and haven't deleted comments, prove me wrong...
Anyone with a working brain would never say interest rates wouldn't rise. I still think there's room on the top end to go up higher. If they do they do, if they don't they don't. Fact is I haven't been wrong. I've predicted for years that cities will eat shit for some time. I could see it being a decade. There is a massive demographic shift. Between crime and leftist policies, cities are going to lose value and lower cost locations (rural) are going to boom. On paper it will look like shit, but it's not because the lower priced areas will increase and high end properties in shit hole urban areas will drop. Take the time like I have, and posted here, to do a basic Uhaul search for pricing and the answer is staring you in the face with me being right. You don't even need to look at housing.
Again, you cherry pick data to prove what you think is a point. Housing is just fine currently. We've doubled the cost of borrowing from historic lows and prices in most places are level or continuing to increase. Cities will decrease. One area of housing doing poorly does not make a bust dude. The national median will go down and the media will goad you into fear mode which it seems you've taken hook, line and sinker style. Look outside CA and do serious research before spouting off. This isn't 2006.
WookieMan says
no point have I ever read here that interest rates wouldn't rise by a single user. You're flat out lying man.
That's funny.
You were one of them.
At no point did I say interest rates won't rise ever. That's fact. What I've always said is a rise won't matter if there's still no inventory. I'm not wrong. You're conflating the two ideas. Interest rates rose and it didn't matter. Cherry pick San Francisco, fine. I said cities would eat shit, I was 100% right. I don't and haven't deleted comments, prove me wrong...
Anyone with a working brain would never say interest rates wouldn't rise. I still think there's room on the top end to go up higher. If they do they do, if they don't they don't. Fact is I haven't been wrong. I've predicted for years that cities will eat shit for some time. I could see it being a decade. There is a massive demographic shift. Between crime and leftist policies, cities are going to lose value and lower cost locations (rural) are going to boom. On paper it will look like shit, but it's not because the lower priced areas will increase and high end properties in shit hole urban areas will drop. Take the time like I have, and posted here, to do a basic Uhaul search for pricing and the answer is staring you in the face with me being right. You don't even need to look at housing.
Again, you cherry pick data to prove what you think is a point. Housing is just fine currently. We've doubled the cost of borrowing from historic lows and prices in most places are level or continuing to increase. Cities will decrease. One area of housing doing poorly does not make a bust dude. The national median will go down and the media will goad you into fear mode which it seems you've taken hook, line and sinker style. Look outside CA and do serious research before spouting off. This isn't 2006.
3919
Eman
2023 Dec 9, 11:23pm
Eman
2023 Dec 9, 11:23pm
I agree this is not 2006. The dynamic is different. With the exception of home buyers from summer 2022 to now, most people have locked in low fixed mortgage rates at 3.5% or lower.
For each seller who wants to sell and trade up or down, he’s also a buyer. People don’t want to give up their current 3% mortgage and pay 7-8% on the new house. Thus, the market is kind at an impasse. That’s why inventory remains low. Houses in desirable neighborhoods are still fetching for top dollars. It’s madness. Houses in meh neighborhoods are not selling very well; thus, lower prices.
For each seller who wants to sell and trade up or down, he’s also a buyer. People don’t want to give up their current 3% mortgage and pay 7-8% on the new house. Thus, the market is kind at an impasse. That’s why inventory remains low. Houses in desirable neighborhoods are still fetching for top dollars. It’s madness. Houses in meh neighborhoods are not selling very well; thus, lower prices.
3920
DOGEWontAmountToShit
2023 Dec 9, 11:23pm
DOGEWontAmountToShit
2023 Dec 9, 11:23pm
WookieMan says
We had a big fight over it. You kept insisting just that and that I didn't know shit because you arrogantly thought of yourself as some sort of Lord of Real Estate Experience. You were probably more nuanced vs the yahoos that just said it couldn't happen. But you came to their defense.
WookieMan says
God fucking damnit. I am not cherry picking shit. Patrick did in clipping and pasting that part about San Fran from that article. And so my comments was IN FUCKING CINTEXT with that....as logic ditctates.
You're the one that doesn't have fucking shit for reading comprehension skills that causes you to shit all over yourself and then having a hissy shit when someone points that out. Not for the first time, too.
I am going back through posts to find the smoking gun on the 'Housing Experts' bullshit. But w/o search working well here it is a slog.
At no point did I say interest rates won't rise ever. That's fact. What I've always said is a rise won't matter if there's still no inventory. I'm not wrong. You're conflating the two ideas. Interest rates rose and it didn't matter. Cherry pick San Francisco, fine. I said cities would eat shit, I was 100% right. I don't and haven't deleted comments, prove me wrong...
We had a big fight over it. You kept insisting just that and that I didn't know shit because you arrogantly thought of yourself as some sort of Lord of Real Estate Experience. You were probably more nuanced vs the yahoos that just said it couldn't happen. But you came to their defense.
WookieMan says
Again, you cherry pick data to prove what you think is a point...pick San Francisco, fine.
God fucking damnit. I am not cherry picking shit. Patrick did in clipping and pasting that part about San Fran from that article. And so my comments was IN FUCKING CINTEXT with that....as logic ditctates.
You're the one that doesn't have fucking shit for reading comprehension skills that causes you to shit all over yourself and then having a hissy shit when someone points that out. Not for the first time, too.
I am going back through posts to find the smoking gun on the 'Housing Experts' bullshit. But w/o search working well here it is a slog.
3921
Eman
2023 Dec 9, 11:33pm
Eman
2023 Dec 9, 11:33pm
2024 will be interesting with WallStreet expects the Fed to cut rates at least a couple times. It can be the year of housing stabilization if the Fed can achieve “the soft landing” while the employment market remains strong.
From a number’s perspective for the Bay Area housing market, the gap between buy/rent ratio is still too big IMO.
From a number’s perspective for the Bay Area housing market, the gap between buy/rent ratio is still too big IMO.
3922
WookieMan
2023 Dec 9, 11:48pm
WookieMan
2023 Dec 9, 11:48pm
PumpingRedheads says
First off, you got one thing right for once, I am the lord of real estate experience. NAR gave me that title in 2015.
I didn't come to anyone's defense. Other people's opinions are theirs. I may agree, but I'm not defending anyone here. You're right that San Fransisco is eating shit literally and figuratively. That's one overpriced market that will make the overall market look bad when $2M properties go for $1.2M. It doesn't mean it's bad elsewhere. It doesn't mean it was because of rising interest rates either.
Cities are shit holes and are going to take a beating over the next decade. This has been my statement. I'm not overly concerned with interest rates in the overall market. There's 2 houses for sale in my town and in a balanced market it would be 15-20. A friend of my kid has been looking for over a year to find a place.... there's nothing. People know we bought lots and randoms come up to me asking to buy my current house. This is how it is in most of America not called CA or NY.
Fact is there are real estate experts here on Patnet. It might behoove you to listen to some of them. Maybe not be a perpetual bear. 2006 was a once in a life time thing. You've missed out and just ragged on people that did well with RE. Jealousy is not a good look dude. If you're in CA, maybe move and join in on the gains like everyone from that state is doing and destroying other states in the process....
We had a big fight over it. You kept insisting just that and that I didn't know shit because you arrogantly thought of yourself as some sort of Lord of Real Estate Experience. You were probably more nuanced vs the yahoos that just said it couldn't happen. But you came to their defense.
First off, you got one thing right for once, I am the lord of real estate experience. NAR gave me that title in 2015.
I didn't come to anyone's defense. Other people's opinions are theirs. I may agree, but I'm not defending anyone here. You're right that San Fransisco is eating shit literally and figuratively. That's one overpriced market that will make the overall market look bad when $2M properties go for $1.2M. It doesn't mean it's bad elsewhere. It doesn't mean it was because of rising interest rates either.
Cities are shit holes and are going to take a beating over the next decade. This has been my statement. I'm not overly concerned with interest rates in the overall market. There's 2 houses for sale in my town and in a balanced market it would be 15-20. A friend of my kid has been looking for over a year to find a place.... there's nothing. People know we bought lots and randoms come up to me asking to buy my current house. This is how it is in most of America not called CA or NY.
Fact is there are real estate experts here on Patnet. It might behoove you to listen to some of them. Maybe not be a perpetual bear. 2006 was a once in a life time thing. You've missed out and just ragged on people that did well with RE. Jealousy is not a good look dude. If you're in CA, maybe move and join in on the gains like everyone from that state is doing and destroying other states in the process....
3923
AD
2023 Dec 10, 12:31am
AD
2023 Dec 10, 12:31am
Eman says
The 30 yr rate is at 7%. I see it at between 5.5% and 6% by next summer.
https://www.freddiemac.com/pmms
If you are looking to sell, one option is to offer to buy up to 4 discount points so that the buyer's rate can be reduced from 6% to 5%. It will cost you 4% of the buyer's mortgage but it will increase the marketability of your home.
A mortgage rate of 5% is a lot closer to the rate when housing prices peaked, which was around 3.75%.
Another option is to allow them to assume your mortgage if it is FHA or VA.
.
2024 will be interesting with WallStreet expects the Fed to cut rates at least a couple times. It can be the year of housing stabilization if the Fed can achieve “the soft landing” while the employment market remains strong.
The 30 yr rate is at 7%. I see it at between 5.5% and 6% by next summer.
https://www.freddiemac.com/pmms
If you are looking to sell, one option is to offer to buy up to 4 discount points so that the buyer's rate can be reduced from 6% to 5%. It will cost you 4% of the buyer's mortgage but it will increase the marketability of your home.
A mortgage rate of 5% is a lot closer to the rate when housing prices peaked, which was around 3.75%.
Another option is to allow them to assume your mortgage if it is FHA or VA.
.
3924
Misc
2023 Dec 10, 1:00am
Right now the 10 yr treasury is at about 4.25%. Prior to Biden taking office investors were willing to purchase them at a negative return, after inflation of about a negative .5%. Now under Biden investors are looking at getting 2% above the rate of inflation.
Historically the 30 yr fixed rate mortgage was about 1.5% over the rate of the 10 yr treasury. Now it is 2.75% above the rate of the 10 yr treasury.
That is a crap load of extra yield investors are getting under Biden. If spreads simply reverted to where they were under Trump the 30 yr fixed rate mortgage would be at 3.75% TODAY.
Historically the 30 yr fixed rate mortgage was about 1.5% over the rate of the 10 yr treasury. Now it is 2.75% above the rate of the 10 yr treasury.
That is a crap load of extra yield investors are getting under Biden. If spreads simply reverted to where they were under Trump the 30 yr fixed rate mortgage would be at 3.75% TODAY.
3925
AD
2023 Dec 10, 11:06am
AD
2023 Dec 10, 11:06am
Misc says
This is a good post on the 30 year mortgage rate's historic correlation with the 10 Year Treasury.
I hope the spread between 30 year mortgage rate and 10 Year Treasury returns to between 1.5% and 2%.
I read that economists desire the 10 Year Treasury rate to be about 1.5% above annual inflation.
So achieving a 2.5% annual inflation may result in a 4% rate for the 10 Year Treasury rate and a 5.5% rate for the 30 year mortgage.
.
.
Right now the 10 yr treasury is at about 4.25%.
This is a good post on the 30 year mortgage rate's historic correlation with the 10 Year Treasury.
I hope the spread between 30 year mortgage rate and 10 Year Treasury returns to between 1.5% and 2%.
I read that economists desire the 10 Year Treasury rate to be about 1.5% above annual inflation.
So achieving a 2.5% annual inflation may result in a 4% rate for the 10 Year Treasury rate and a 5.5% rate for the 30 year mortgage.
.
.
3926
B.A.C.A.H.
2023 Dec 11, 6:52am
B.A.C.A.H.
2023 Dec 11, 6:52am
PumpingRedheads says
Ah... the Snark. Sounds like you're an SF Bay Arean, ground zero for Snarkiness.
PumpingRedheads says
Chill out, bro. A blog is for entertainment and fun. Maybe you should take your anger elsewhere.
Patrick began his blog a long time ago in skepticism about SF Bay Area ®eal Estate Hokum. That's been the major theme on threads about house prices in the Bay Area.
I was reading back on your remarks about "housing experts" pooh-poohing the skepticism. I didn't see any quotes of those posts you mentioned nor any blog-handles of the posters or anything like that. Is it a hallucination?
Chill out, bro.
Mr. I've Been On PatNet Since '06 during all this?
Ah... the Snark. Sounds like you're an SF Bay Arean, ground zero for Snarkiness.
PumpingRedheads says
God fucking damnit. I am not cherry picking shit. Patrick did in clipping and pasting that part about San Fran from that article. And so my comments was IN FUCKING CINTEXT with that....as logic ditctates.
Chill out, bro. A blog is for entertainment and fun. Maybe you should take your anger elsewhere.
Patrick began his blog a long time ago in skepticism about SF Bay Area ®eal Estate Hokum. That's been the major theme on threads about house prices in the Bay Area.
I was reading back on your remarks about "housing experts" pooh-poohing the skepticism. I didn't see any quotes of those posts you mentioned nor any blog-handles of the posters or anything like that. Is it a hallucination?
Chill out, bro.
3927
EBGuy
2023 Dec 11, 1:59pm
Eman says
This is the derangement of Prop 13. The guy pays less than $300 a month in taxes on a property valued at $38k. He can probably hold out forever; meanwhile, the city is deprived of much needed housing...
You won’t believe what the seller has in mind. Offer $650k cash and he “might” accept it. Otherwise, he’ll tear it down. Who’s the shark here?
This is the derangement of Prop 13. The guy pays less than $300 a month in taxes on a property valued at $38k. He can probably hold out forever; meanwhile, the city is deprived of much needed housing...
3928
Eman
2023 Dec 11, 5:16pm
Eman
2023 Dec 11, 5:16pm
EBGuy says
Real estate investment and flipping is very competitive. It’s not easy to “win” a deal, and it’s not easy to make money after we get the deal. It’s just the reality of Bay Area real estate.
We offered $620k for it 5 months ago. The listing agent told us we had to come in the high $600’s to get a chance. We said no thank you.
For people who think flippers are stealing other people’s housing, feel free to buy this house and fix it up to their taste. They get to keep the lower $650k property tax basis too rather than $1.1-$1.2M valuation.
Eman says
You won’t believe what the seller has in mind. Offer $650k cash and he “might” accept it. Otherwise, he’ll tear it down. Who’s the shark here?
This is the derangement of Prop 13. The guy pays less than $300 a month in taxes on a property valued at $38k. He can probably hold out forever; meanwhile, the city is deprived of much needed housing...
Real estate investment and flipping is very competitive. It’s not easy to “win” a deal, and it’s not easy to make money after we get the deal. It’s just the reality of Bay Area real estate.
We offered $620k for it 5 months ago. The listing agent told us we had to come in the high $600’s to get a chance. We said no thank you.
For people who think flippers are stealing other people’s housing, feel free to buy this house and fix it up to their taste. They get to keep the lower $650k property tax basis too rather than $1.1-$1.2M valuation.
3929
RWSGFY
2023 Dec 11, 5:34pm
RWSGFY
2023 Dec 11, 5:34pm
What happens to the property tax in CA if the structure is torn down and the land sits vacant? Does the tax go down because there is no improvements anymore or does it go up because the demolition would trigger a reassesment and the land alone is way more than what it was 40-50 years ago?
3930
AmericanKulak
2023 Dec 11, 5:42pm
AmericanKulak
2023 Dec 11, 5:42pm
WookieMan says
2nd in a lifetime.
The Venture Capital/REIT SFH ownership is grossly exaggerated, single digit % and that concentrated in and around the most desireable metropolitan areas, mostly new developments, and if they took variable loans to get the "Cash" they paid in, as most of them did, boy are they gonna unload. All the "Cash buyers" borrowed that cash when the interest rates are low. Hope the rate they borrowed was fixed and not a variable loan against a money market account.
Like amateur Mutual Fund pickers, they all selected based on previous run-ups, thinking the price/rent appreciation was only going north.
Foreigners are not buying SFHs in suburbs of Sandusky, OH or Cairo, IL. They are buying in Hoboken and San Jose, outer city but no further.
Builders are dumping for a reason, with teaser rates and cutting way back on builds, trying to only finish what must be finished. The last few houses in a development to close it all up.
Unlike Realtors and Flippers, Developers have no reason to lie about the next few years. Realtors and Flippers have an interest in permanent plateau propaganda.
The Boomers aging OUT of SFH in the midst of interest rates not seen in decades is going to be the shock of a century. There is no demographic large enough to fully replace them, it is demographic fact. Nothing about it is arguable.
70 year olds get sick or infirm and can't keep up the 1800 sq ft, esp. multilevel. It will happen, the only question is when the drop down is next year or a few years from now. Demographic, inescapable fact.
"But their kids will inherit". You mean the kids that live 3 states away? And looking at the demos, all those heirs will be selling or trying to rent at about the same time. Hey, hey momma, rents & values goin' down, they're going down.
Divorced single moms with one kid, or single men, don't need 4 or 5 bed, 1800 sq ft, 2 car garage multilevels at mortgages exceeding $2500k/month or more before insurance and tax. Amber doesn't mow lawns or clean gutters. Dylan can barely open a pickle jar or change a tire.
Even if Trump is elected and the economy starts booming and industry comes back to the point where Zoomer HS grads can get a $25/hr job with benefits manufacturing chotskies here in the USA, it's coming.
It doesn't matter in Hispanic and Indian immigrants living 7 to a 4 or 5 bed, 2.5 McMansion start Americanizing and pairing off into SFHs of their own. Not enough of them to fully replace the boomers. Successive generations have almost one child less and far less likely to be married. They are far less affulent. They have far more debt since jobs like Loan Officer boomers could get without degrees, have required degrees for 3 decades now. Fewer, smaller households, less affulence. There is nobody coming to keep pumping the prices or so much as maintain them.
No matter how much Mr. Boomer likes to play air guitar to Santana while putzing around his Harley in the garage, his joints are hurting more, his bones are getting weaker, and the arteries they are a cloggin'
We actually have a SFH glut, it's just not apparent.... yet.
We're going to go from begging empty nest boomers to sell, to begging them to stay put and out of Long Term care and Assisted Living, another thing we're utterly unprepared for.
If you are long SFH or are considering downsizing, do it right now before it's too late.
2006 was a once in a life time thing.
2nd in a lifetime.
The Venture Capital/REIT SFH ownership is grossly exaggerated, single digit % and that concentrated in and around the most desireable metropolitan areas, mostly new developments, and if they took variable loans to get the "Cash" they paid in, as most of them did, boy are they gonna unload. All the "Cash buyers" borrowed that cash when the interest rates are low. Hope the rate they borrowed was fixed and not a variable loan against a money market account.
Like amateur Mutual Fund pickers, they all selected based on previous run-ups, thinking the price/rent appreciation was only going north.
Foreigners are not buying SFHs in suburbs of Sandusky, OH or Cairo, IL. They are buying in Hoboken and San Jose, outer city but no further.
Builders are dumping for a reason, with teaser rates and cutting way back on builds, trying to only finish what must be finished. The last few houses in a development to close it all up.
Unlike Realtors and Flippers, Developers have no reason to lie about the next few years. Realtors and Flippers have an interest in permanent plateau propaganda.
The Boomers aging OUT of SFH in the midst of interest rates not seen in decades is going to be the shock of a century. There is no demographic large enough to fully replace them, it is demographic fact. Nothing about it is arguable.
70 year olds get sick or infirm and can't keep up the 1800 sq ft, esp. multilevel. It will happen, the only question is when the drop down is next year or a few years from now. Demographic, inescapable fact.
"But their kids will inherit". You mean the kids that live 3 states away? And looking at the demos, all those heirs will be selling or trying to rent at about the same time. Hey, hey momma, rents & values goin' down, they're going down.
Divorced single moms with one kid, or single men, don't need 4 or 5 bed, 1800 sq ft, 2 car garage multilevels at mortgages exceeding $2500k/month or more before insurance and tax. Amber doesn't mow lawns or clean gutters. Dylan can barely open a pickle jar or change a tire.
Even if Trump is elected and the economy starts booming and industry comes back to the point where Zoomer HS grads can get a $25/hr job with benefits manufacturing chotskies here in the USA, it's coming.
It doesn't matter in Hispanic and Indian immigrants living 7 to a 4 or 5 bed, 2.5 McMansion start Americanizing and pairing off into SFHs of their own. Not enough of them to fully replace the boomers. Successive generations have almost one child less and far less likely to be married. They are far less affulent. They have far more debt since jobs like Loan Officer boomers could get without degrees, have required degrees for 3 decades now. Fewer, smaller households, less affulence. There is nobody coming to keep pumping the prices or so much as maintain them.
No matter how much Mr. Boomer likes to play air guitar to Santana while putzing around his Harley in the garage, his joints are hurting more, his bones are getting weaker, and the arteries they are a cloggin'
We actually have a SFH glut, it's just not apparent.... yet.
We're going to go from begging empty nest boomers to sell, to begging them to stay put and out of Long Term care and Assisted Living, another thing we're utterly unprepared for.
If you are long SFH or are considering downsizing, do it right now before it's too late.
3931
FortwayeAsFuckJoeBiden
2023 Dec 11, 5:43pm
RWSGFY says
i believe improvement part just drops off on taxes. my tax bill listed land value and improvements on it when i had property there.
but if you build new, new improvements are assessed at market rates.
What happens to the property tax in CA if the structure is torn down and the land sits vacant? Does the tax go down because there is no improvements anymore or does it go up because the demolition would trigger a reassesment and the land alone is way more than what it was 40-50 years ago?
i believe improvement part just drops off on taxes. my tax bill listed land value and improvements on it when i had property there.
but if you build new, new improvements are assessed at market rates.
3932
HeadSet
2023 Dec 12, 8:46am
HeadSet
2023 Dec 12, 8:46am
AmericanKulak says
Good point, but those kids three states away will buy homes in that area, plus other kids in your area who have parents 3 states away will buy in your area. Also consider printing press inflation that may leave housing as one of the few hedges left.
You mean the kids that live 3 states away?
Good point, but those kids three states away will buy homes in that area, plus other kids in your area who have parents 3 states away will buy in your area. Also consider printing press inflation that may leave housing as one of the few hedges left.
3933
zzyzzx
2023 Dec 12, 9:47am
zzyzzx
2023 Dec 12, 9:47am
https://www.newsweek.com/housing-market-drop-new-homeowners-loss-equity-freefall-1850573
New Homeowners Lose $122,000 as Housing Prices Drop
New homeowners across the U.S. are confronting a rapid depreciation in their home values.
New Homeowners Lose $122,000 as Housing Prices Drop
New homeowners across the U.S. are confronting a rapid depreciation in their home values.
3934
RWSGFY
2023 Dec 12, 10:03am
RWSGFY
2023 Dec 12, 10:03am
zzyzzx says
Ha! I'm not even a new homeowner and I've "lost" almost $600K! 🤡
https://www.newsweek.com/housing-market-drop-new-homeowners-loss-equity-freefall-1850573
New Homeowners Lose $122,000 as Housing Prices Drop
New homeowners across the U.S. are confronting a rapid depreciation in their home values.
Ha! I'm not even a new homeowner and I've "lost" almost $600K! 🤡
3935
WookieMan
2023 Dec 12, 10:12am
WookieMan
2023 Dec 12, 10:12am
AmericanKulak says
They're not building them, so not sure what they'd downsize to. The values can't go down in most locations. You have a bigger generation with buying power regardless of interest rates and an aging demo that doesn't want to move OR still has the kids living with them.
I'm a geezer millennial. All my closest friends own their homes. 90%. Most of their parents, Boomers have already downsized. Many in my circle are wealthy and their parents just keep their family home. No one is selling. With low interest rates locked in, it's cheaper to keep the house and get hired help for the Boomers.
If you have a daughter that's lost with no career ambition, have them get in the home healthcare business. Boomers aren't moving. They'll stay home. They're stubborn as fuck. That's something people overlook. Between commissions, cost of moving, hassle Boomers simply aren't moving into assisted living and probably won't. Maybe in 10-15 years once they approach 80-90, but it's not happening any time soon. Just wait for the reverse mortgage wave. That's coming in a big way.
If you are long SFH or are considering downsizing, do it right now before it's too late.
They're not building them, so not sure what they'd downsize to. The values can't go down in most locations. You have a bigger generation with buying power regardless of interest rates and an aging demo that doesn't want to move OR still has the kids living with them.
I'm a geezer millennial. All my closest friends own their homes. 90%. Most of their parents, Boomers have already downsized. Many in my circle are wealthy and their parents just keep their family home. No one is selling. With low interest rates locked in, it's cheaper to keep the house and get hired help for the Boomers.
If you have a daughter that's lost with no career ambition, have them get in the home healthcare business. Boomers aren't moving. They'll stay home. They're stubborn as fuck. That's something people overlook. Between commissions, cost of moving, hassle Boomers simply aren't moving into assisted living and probably won't. Maybe in 10-15 years once they approach 80-90, but it's not happening any time soon. Just wait for the reverse mortgage wave. That's coming in a big way.
3936
GNL
2023 Dec 12, 11:13am
GNL
2023 Dec 12, 11:13am
My 78 year old mother in law is selling and purchasing another SFH. We're trying to convince her to purchase a condo but, nope.
3939
AD
2023 Dec 12, 4:55pm
AD
2023 Dec 12, 4:55pm
EBGuy says
That's mainly because the 30 yr mortgage rate is at least 7.25%.
.
https://www.forbes.com/advisor/mortgages/rent-or-buy-home-mortgage/
That's mainly because the 30 yr mortgage rate is at least 7.25%.
.
3940
HeadSet
2023 Dec 12, 6:11pm
HeadSet
2023 Dec 12, 6:11pm
GNL says
Why? If you are worried about upkeep, lawn service is cheap.
My 78 year old mother in law is selling and purchasing another SFH. We're trying to convince her to purchase a condo but, nope.
Why? If you are worried about upkeep, lawn service is cheap.
3941
AD
2023 Dec 12, 7:07pm
AD
2023 Dec 12, 7:07pm
HeadSet says
The problem is that the HOA fees may be very expensive making it not economically better to live in a condo or townhome.
Even if the HOA board and the management company are not corrupt, it may not be competent as far as gaining the best value for the community.
I rather live in a gated community with very little HOA fees. I would rather have a single detached home that I would maintain in a gated community and HOA.
.
GNL says
My 78 year old mother in law is selling and purchasing another SFH. We're trying to convince her to purchase a condo but, nope.
Why? If you are worried about upkeep, lawn service is cheap.
The problem is that the HOA fees may be very expensive making it not economically better to live in a condo or townhome.
Even if the HOA board and the management company are not corrupt, it may not be competent as far as gaining the best value for the community.
I rather live in a gated community with very little HOA fees. I would rather have a single detached home that I would maintain in a gated community and HOA.
.
3942
GNL
2023 Dec 12, 7:57pm
GNL
2023 Dec 12, 7:57pm
HeadSet says
Snow. She's moving to PA. Most of her family is in NY. Condo seems safer?
GNL says
My 78 year old mother in law is selling and purchasing another SFH. We're trying to convince her to purchase a condo but, nope.
Why? If you are worried about upkeep, lawn service is cheap.
Snow. She's moving to PA. Most of her family is in NY. Condo seems safer?
3943
WookieMan
2023 Dec 12, 9:28pm
WookieMan
2023 Dec 12, 9:28pm
GNL says
I'll be blunt. Does it matter? Older people are stubborn. You and I will be stubborn when we get old. Once you hit 60 you know your time is limited and you say fuck it. You don't care what other people think. You don't want to have a adult sitter for yourself. You think you can still do it and just don't care anymore.
I wouldn't fight the battle. Unless worried about having to manage the home yourself and they don't have the money. Otherwise it's not difficult to make phone calls and have people manage the snow and lawn and other issues that come up. The alternative of pushing someone to live in a place they don't want to is likely worse. My 2¢.
HeadSet says
GNL says
My 78 year old mother in law is selling and purchasing another SFH. We're trying to convince her to purchase a condo but, nope.
Why? If you are worried about upkeep, lawn service is cheap.
Snow. She's moving to PA. Most of her family is in NY. Condo seems safer?
I'll be blunt. Does it matter? Older people are stubborn. You and I will be stubborn when we get old. Once you hit 60 you know your time is limited and you say fuck it. You don't care what other people think. You don't want to have a adult sitter for yourself. You think you can still do it and just don't care anymore.
I wouldn't fight the battle. Unless worried about having to manage the home yourself and they don't have the money. Otherwise it's not difficult to make phone calls and have people manage the snow and lawn and other issues that come up. The alternative of pushing someone to live in a place they don't want to is likely worse. My 2¢.
3945
AD
2023 Dec 12, 10:14pm
AD
2023 Dec 12, 10:14pm
Best to live together in a multi generational house. Save money and be able to look out for each other.
The Asians are very adept at this.
.
The Asians are very adept at this.
.
3946
GNL
2023 Dec 13, 3:26am
GNL
2023 Dec 13, 3:26am
ad says
I suggested she do that with her oldest son. Nope. And she keeps talking about how she's going to leave a bunch of $$ to her kids. Nope, it will all be eaten up for medical expenses. Not complaining, just making observations.
Best to live together in a multi generational house. Save money and be able to look out for each other.
The Asians are very adept at this.
.
I suggested she do that with her oldest son. Nope. And she keeps talking about how she's going to leave a bunch of $$ to her kids. Nope, it will all be eaten up for medical expenses. Not complaining, just making observations.
3947
WookieMan
2023 Dec 13, 7:05am
WookieMan
2023 Dec 13, 7:05am
ad says
Couldn't do it. Have done it. I can't live with other people that aren't my kids or wife. Stupid shit is picked up on. I've done it with my parents and my wife's parents for literally 3 months a piece and couldn't stand it during the housing crash. Everything is hyper analyzed about your lifestyle. How you raise kids. The food you make. How you treat your spouse. You have roomates that are more judgmental than a college roomate. The list goes on.
I get the idea, but it doesn't work if you want to be happy. Asians can do it all they want, but realistically, if they're being honest, they're not happy. You need your own home. I'll even go further and say it has to be a detached home that you don't share walls with anyone, HOA and all the bull shit that comes with that if you go the condo route. Maybe a family compound with separate structures on acreage, but you cannot and should not live within the same walls as family 100%. It's toxic. Anyone that says it isn't is lying and someone you shouldn't trust moving forward.
Best to live together in a multi generational house. Save money and be able to look out for each other.
The Asians are very adept at this.
.
Couldn't do it. Have done it. I can't live with other people that aren't my kids or wife. Stupid shit is picked up on. I've done it with my parents and my wife's parents for literally 3 months a piece and couldn't stand it during the housing crash. Everything is hyper analyzed about your lifestyle. How you raise kids. The food you make. How you treat your spouse. You have roomates that are more judgmental than a college roomate. The list goes on.
I get the idea, but it doesn't work if you want to be happy. Asians can do it all they want, but realistically, if they're being honest, they're not happy. You need your own home. I'll even go further and say it has to be a detached home that you don't share walls with anyone, HOA and all the bull shit that comes with that if you go the condo route. Maybe a family compound with separate structures on acreage, but you cannot and should not live within the same walls as family 100%. It's toxic. Anyone that says it isn't is lying and someone you shouldn't trust moving forward.
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https://finance.yahoo.com/news/pimco-kiesel-called-housing-top-160339396.html?source=patrick.net
Bond manager Mark Kiesel sold his California home in 2006, when he presciently predicted the housing bubble would pop. He bought again in 2012, after U.S. prices fell more than 30% and found a floor.
Now, after a record surge in prices, Kiesel says the time to sell is once again at hand.