patrick.net

Blake, Glengarry Glen Ross: "I can go out there tonight, with the materials you got, and make $15,000. Can you? Can you?"

Unfortunately the majority of retired use social security as their major retirement income.

The average is $1788 per recipient.

I didn't plan on using social security to provide for my retirement so I'm OK; but I sure know a lot of coupon clippers and people who seek out "early bird" specials.

Nobody 18 ever thought about retirement investing; people tend to "wake up to reality" about 10 years after that age.

I have worked at several companies (although this was decades ago) which did not provide a 401K for their workers. It's probably unusual today however.

WookieMan says

Did they not save at all? We're talking dual income

Correct. A lot of people saved little or nothing. I'm not even referring to people with defined benefit pension plans either. Fiscal responsibility is the exception, not the norm.

AmericanKulak says

Also: Gas is ~$3/gal, it's $33 to fill a tank once a week or ~$130/month.
And I don't see car insurance.
Used cars almost never have any covered maintenance at all.

Imagine if they had a kid.

Here in Silicon Valley, incomes are higher, but so are costs.

Back in the day I worked nights for as many years (7) as I could so we only needed childcare a few hours a day so I could get a bit of sleep. Eventually I had to cave and work days as I'd reached the career ceiling working nights. When that happened, for the most part the childcare bills for one infant and one preschooler consumed the net of my coparent's take home. But at least her continuous max'd contributions to retirement (including social security) were uninterrupted.

I was curious and did some internet searches on current childcare costs in SFBA for infants and toddlers. It's about $30k per year per infant or toddler and sliding scale downward for older kids. In our region anyone who can afford 30K per child is in the 9% state income tax bracket and either 22% or 24% federal.

Since child care expense is on top of all the other living costs, it means to pay $30k per child is on the top of the income and so requires annual income of about $44k per child. Small wonder the SFBA is rapidly becoming an aging childless region.

(Are you paying attention, public teachers' unions?)

The other option is work for government; the median income in the area near DC is double the national median.

B.A.C.A.H. says

Since child care expense is on top of all the other living costs, it means to pay $30k per child is on the top of the income and so requires annual income of about $44k per child. Small wonder the SFBA is rapidly becoming an aging childless region.

So glad to be done with that phase of life. The 4th grade and under years sucked. Yeah I enjoyed it, but you really have to be on top of it. That's why I quit my job though. They then started activities and sports and I enjoy that. I'll go back to full time work in about 2 years. Still working, but it's part time odd job stuff.

Wife travels too much. MIL is a drunk and my mom lives an hour away and my sister is a widow. So tough to ask for help. Fortunately have a solid core of neighbors and friends that can help out in a pinch. But I can work full time. Once my oldest son can drive it will be better.

clambo says

The other option is work for government; the median income in the area near DC is double the national median.

The average salary is at GS 14 step 3 level in the Washington DC metro area, and accounts for legions of "support contractors" as they are the ones that really do the work at the agencies.

About 25 years ago there was a transition whereas federal government civil servants make more than their "support contractor" counterparts.

They started to upgrade positions that were at GS 11 to ultimately GS 13. Notice how DC area housing (including townhomes) changed accordingly.

Now the goal is for "support contractors" to at least get a GS 13 job.

The only exception is for the legal field, whereas lawyers will get the experience working at DOJ or for a federal judge and then go work for a high dollar law firm.

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AD says

Miller HIgh Life (which is one of the best American made beer besides Yuengling Lager

100% agree, and I thought I was the only one with that opinion. Miller and Yuengling are the only ones with the traditional beer taste. The others have changed over the years to taste like boilermakers or water.

HeadSet says

AD says

Miller HIgh Life (which is one of the best American made beer besides Yuengling Lager

100% agree, and I thought I was the only one with that opinion. Miller and Yuengling are the only ones with the traditional beer taste. The others have changed over the years to taste like boilermakers or water.

Miller High Life yes. Regular Miller or Miller light is bad. MHL used to be my beer of choice 15 years ago.

I can't mix up beer so I'm Busch Light at this point. Not looking to get hammered, just have a decent beer. Not great, but not awful. No headaches ever. On vacation I will sneak in a breakfast beer or two with room service (not at home).

If I get good sleep on the flight tomorrow, Saturday is gonna be one of those days. Hell tomorrow will be somewhat early getting our transfer. Group of 12 of us. Should be fun. I don't think most of them have done T4 at Cancun. I'm walking fast and getting 3-4 beers for the transfer at the outdoor bar

Sorry for the tangent as usual. Just getting pumped. Should be a good time.

AmericanKulak says

Okie-Arkie median Rent: ~$1100
Okie Arkie median wage: ~$50k/year

FL median Rent: ~$1800
FL median wage: ~$53k/year

been finding gems at $1900 on east end of Panama City Beach like this relatively new 3 bedroom/2.5 bath/1 car garage townhome listed for at least 120 days

same townhome would have rented for $2100 back in 2022, so this tells me that local household income is catching up more with rent

https://www.zillow.com/homedetails/7652-Shadow-Lake-Dr-Panama-City-Beach-FL-32407/305989650_zpid/

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AD says

same townhome would have rented for $2100 back in 2022, so this tells me that local household income is catching up more with rent

Yes, the rents are getting clawed back steadily over the past two years, adjusting for Florida being #38 of 50 states for median wages yet well above the median national rent of $1600-1800 depending on source (as of late 2024). According to Zillow, FL is 25% above average.

Since the state runs on tourism and retirees rather than high value services and manufacturing, the ability of employers to raise wages is limited, so affordability adjustments will have to come from rents.

Another thing lowering rents is that Florida has 100k's of multifamily still in the pipeline with more opening up every month, thanks to post Financial Crisis anti-project abandonment rules and bonding requirements

And finally, the 20-40 year old multistory condos with the assessments and hoa fee increases beyond the ability of the truly elderly to meet. Which is often the homeloaner's fault, since they bypassed any inspections or deferred maintenance for decades.

https://www.floridarealtors.org/news-media/news-articles/2024/02/floridas-rent-costs-are-slowly-dropping
https://www.miamiherald.com/news/business/real-estate-news/article295458634.html

Should probably serve as a wake-up call when Blackstone is selling properties at a $130,000 loss.

Their subsidiary, Home Partners of America, is being shut down. And some big discounts are hitting the US Housing Market as a result.
https://www.youtube.com/watch?v=i2AT3Msc-SE

7% Rates are the "Old Normal" as Wolf puts it, and that's a good place to be. It keeps the speculation and unsuitable buyers under control, tames the animal spirit excesses.

Also, knowing property managers in Orlando,and seeing some them IRL, about half the population in multifamily dwellers there are, in tthe words of Dante, "not even supposed to be here (today)."

The number of illegals/overstays in the US is much, much larger than any of the official estimates.

AmericanKulak says

7% Rates are the "Old Normal" as Wolf puts it, and that's a good place to be. It keeps the speculation and unsuitable buyers under control, tames the animal spirit excesses.

Well said.

AmericanKulak says

7% Rates are the "Old Normal" as Wolf puts it, and that's a good place to be. It keeps the speculation and unsuitable buyers under control, tames the animal spirit excesses.

Yes, the Wolfman at Wolf Street website has always been very astute at warning of asset bubbles.

I think the air is slowly being let out of Panama City Beach and Bay County real estate prices over the last 2.5 years. I'm keeping an eye on the tourism tax or "bed tax" data provided by Bay County government to notice any major decrease in tourism.

For Bay County and Panama City Beach, I would estimate based on local data like from chamber of commerce that about

40% : hospitality and service (retail, restaurants, etc) jobs
10% : healthcare (the local regional hospitals are used by people from other panhandle counties)
15%: military and federal government (Tyndall AFB, Naval Station Panama City, Coast Guard base, small NOAA station)
15%: manufacturing (Berg Pipe, Trane Air Conditioning, Eastern Shipyard, etc)
10%: Bay County Sheriff, Bay County School District, state government offices, etc
10% : miscellaneous

..

AmericanKulak says

The number of illegals/overstays in the US is much, much larger than any of the official estimates.

The Dems still going off Obama numbers of "only 11 million illegal immigrants in the USA". They (and their crony accomplices at the chamber of commerce, etc) want amnesty so they can force giving citizenship to +35 million illegal immigrants (not 11 million).

Yes I saw that one post of Blackstone selling the Florida single family house for a $130K loss, and it was about 25% below its all time high price (set around 2022).
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https://www.wsj.com/politics/policy/capitol-hill-dc-goverment-job-cuts-a283316c

DOGEWontAmountToShit says

https://www.wsj.com/politics/policy/capitol-hill-dc-goverment-job-cuts-a283316c

And even those who are not laid off may find their agency transferred to a Midwestern city.

HeadSet says

And even those who are not laid off may find their agency transferred to a Midwestern city.

In which case, they will have to sell...in a declining market.

HeadSet says

And even those who are not laid off may find their agency transferred to a Midwestern city.

Good idea. Extinguish Potomac Fever.

I know Adam Taggart. Good guy.

I swear sometimes you guys live on different planets or don't travel at all. Coastal areas will get trashed and it will validate your narrative. That's not the case though for most of the country. Look locally and don't project nationally. No inventory here and prices are going up so much that people are building because there's no re-sale homes on the market. That's why I never look at national prices.

WookieMan says

I swear sometimes you guys live on different planets

That would describe you more than the rest of us.

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The Baron's article author recommends the federal government work with states and counties to increase housing inventory.

They broke ground and excavated for Hathaway Luxury Apartments in Panama City Beach, but nothing else has been done for at least 4 months. They may be waiting for rents to stabilize at least, as well as for interest rates to drop some as well.

The listed rents for townhomes like at Hathaway Townhomes and Annabellas Tonwhomes are at 2021 or 2022 levels.

Urban Blu Apartments has been very coy (as expected) as far as listing rental rates and incentives (1 month free).

Florida is a lot more speculative and boom-bust for residential real estate than stingy states like California and Illinois, so it is usually the first state to show residential real estate market strain.

But I am seeing Florida sales on Zillow, albeit at 20 to 25% below all time high levels set in early 2022.

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What is interesting is I researched "Hathaway Luxury Apartments" in Panama City Beach (within 1 mile of Hathaway Bridge). It's a huge area where they cleared countless amount of southern pine trees, as it looks like at least 200 apartment units will be built.

The agent for the Hathaway Luxury Apartment is
Marvin Setness - Controller - RD Offutt Company

I wonder why a potato company (RD Offutt Company) is an apartment developer in Panama City Beach :-/

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For those listings that are showing 20-25% discounts, I'm gonna bet that there are problems with the property and tons of deferred maintenance.

Misc says

For those listings that are showing 20-25% discounts, I'm gonna bet that there are problems with the property and tons of deferred maintenance.

Bingo. And have to move for whatever reason so they list low to get out of it. Generally they're walking with equity as well. There's not many distressed sales and they'll always exist.

I know for sure I've been involved in more real estate transactions than anyone on this forum over a 15 year period. Your comment is spot on though. The market started a slow rebound with low interest rates a decade ago so no one moved.

I love it when people think they know what's going on with the market, yet haven't even worked a day in it. There's always a story behind a listing marked down 20%. It doesn't mean an overall market correction is coming though. I know this started as a housing crash site and some buy/rent types, but this market is completely different.

The are so many false narratives out there. Millennials can't and won't buy. Utter bull shit. Boomers will move and the market will plummet. Again BS. They already moved if retired, that ship has sailed. Also people don't understand basic supply and demand. Builders build to demand now. Not build it and they'll come because they could get an easy loan. No skilled trades either after a decade plus of generally not building.

I think a lot on here get into doom and gloom clickbait article and news. I've said it before, high density urban areas will be hit the worst as Millennials start moving to suburban and rural areas to move their family out to better schools and cheaper cost of living.

@Wookieman: How are real estate agents, brokers, home inspectors etc. doing/managing in the current market?

gabbar says

Wookieman: How are real estate agents, brokers, home inspectors etc. doing/managing in the current market?

The ones I still know are doing fine by me, at least the agents/brokers. Inspectors are doing fine as well. A lot do new building inspections as well as resale home inspections.

Is any of them making $300k/yr? Mostly no in my area. It's hard in real estate as an agent as you split 30% with brokerage (usually) unless you own the place. In NYC, CA and FL getting about $650k GCI is easier, but where I'm at you'd have to sell 20-30 houses a year at least.

During the bust a lot of people just got out of real estate in general. The ones that stay with it are in high demand and have the experience generally. It's the whole pareto principle 80/20%. 80% will trudge along. Stay at home mom that does real estate on the side for 2-3 deals a year. Or a guy that sucks at sales.

20% will do most of the business and those are the types I know and they're fine. Female lenders seem to do better for whatever reason as the job is basic AF, so a pretty face goes a long way.

To sum it up I don't know people leaving the industry unless they have other ambitions. There's also no signs in yards because we don't have inventory. I also think a lot brokers may have put their license in a holding company and just send referral to the top dogs. It's a shitty business on a day to day basis. You have to be super motivated to earn.

HeadSet says

And even those who are not laid off may find their agency transferred to a Midwestern city.

Why do you want to punish Midwestern cities?

WookieMan says

I love it when people think they know what's going on with the market, yet haven't even worked a day in it.

Yeah. I hear you.

Kind of like people thinking they know what's going on in a region yet haven't even lived a day in it.

AD says

The Baron's article author recommends the federal government work with states and counties to increase housing inventory.

We don't need every inch of every state to be multi-family housing. The People's Republic of Cambridge, MA just did away with single-family home zoning.

State planning organizations (like the corrupt mapc.org) are implementing high-density development in all cities/town near MBTA transit. The "Community housing law" requires high-density housing (example: small town of <10K residents must have 15 housing units/acre with ~10 acre minimum of this high-density housing required). This is in addition to the Massachusetts 40B law that requires each city/town ot have 10% "affordable" housing and forces high-density (8 X local zoning law) for 40B. Corrupt developers like Habitech know how to use 40B to destroy towns. Pretty soon, every former small town in MA will be just like Boston or Worcester. Ugh!

Kraft is running against Wu for Boston mayor, but he's no better than Wu. One of his top priorities is more housing and skirting/overriding zoning to get it. He's a developers wet dream.

We need to remove illegals in MA, stop corrupt visa programs (H-1B, TN, OPT, F-1, and others) to stabilize housing.

WookieMan says

Misc says

For those listings that are showing 20-25% discounts, I'm gonna bet that there are problems with the property and tons of deferred maintenance.

Bingo. And have to move for whatever reason so they list low to get out of it. Generally they're walking with equity as well. There's not many distressed sales and they'll always exist.

Look at the one example for Blackstone selling in Florida that was posted here. I checked its Zillow listing and it looked like it needed little to no work.

I'm saying 20% discount from all time high market levels (around early 2022) with homes that are in at least fair to good condition, and this particularly applies to Florida because its normally ahead of other states as far as market bubble corrections.

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B.A.C.A.H. says

Kind of like people thinking they know what's going on in a region yet haven't even lived a day in it.

The spice venture capital will flow. This is the mothers milk of the Bay Area and trickles down in to the housing market. AI is capital intensive, so that is a reason to temper expectations, but otherwise the Q4 numbers are pretty robust.
US gained, Silicon Valley fired up
Venture funding to U.S. companies totaled $178 billion — around 57% of total global funding. The U.S. funding market raised a greater proportion of global funding, up from 48% in 2023.
Of all U.S. funding, $90 billion was invested in the corridors of the San Francisco Bay Area, which experienced a boom from AI investing. Compare that with 2023, when Bay Area companies raised $59 billion in total funding.
Late-stage funding in the fourth quarter reached $61 billion, up more than 70% quarter over quarter and an increase year over year from the $36 billion invested in Q4 2023, Crunchbase data shows.

https://www.redfin.com/news/housing-market-update-listings-piling-up-pending-sales-falling/

Housing Supply Is Piling Up As Home Sellers Enter the Market But Buyers Stay on Sidelines

zzyzzx says

https://www.redfin.com/news/housing-market-update-listings-piling-up-pending-sales-falling/

Housing Supply Is Piling Up As Home Sellers Enter the Market But Buyers Stay on Sidelines

As I mentioned they stopped construction after breaking ground about 4 months ago on Hathaway Luxury Apartments in Panama City Beach.

Eventually demand will meet supply at some equilibrium point.

Maybe there will be increased sales volume when the 30 yr mortgage rate drops to 6% within the next 6 months.

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AD says

Maybe there will be increased sales volume when the 30 yr mortgage rate drops to 6% within the next 6 months.

Core inflation is up against. This time most of it is in services.

OkDOGEisAmountingToSomething says

AD says

Maybe there will be increased sales volume when the 30 yr mortgage rate drops to 6% within the next 6 months.

Core inflation is up against. This time most of it is in services.

The Federal Reserves uses PCE not CPI to track inflation, so we'll see how PCE fares and if it steadies around 2 to 2.5% annually.

May need another 12 months until it reaches steady state, so the Fed Funds rate can be lowered from currently 4.5% to 3.5%.

The 30 Yr mortgage rate should be around 6% based on it historically being around 1.5% greater than the 10 Year Treasury rate (~4.5%).

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AmericanKulak says

One thing is clear: Divest of Northern Virginia Real Estate NOW

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American Kulak,

How much of a disrupter is Trump ? He's going to cause a +20% reduction of the federal government and contractor workforce who live in Northern Virginia ?

At most I see a 10% reduction and that is from now to 4 July 2026 and that is in part through attrition and hiring freezes.

Also, what is the data showing for Northern Virginia as far as days on market, months of inventory, etc ?

I have faith Trump will be a lot more financially prudent and savvy than Birdbrain Biden, who spent about $50 billion a year for Ukraine and $68 billion a year on student loan forgiveness (ref: https://www.crfb.org/blogs/total-cost-student-debt-cancellation). Let alone the $11 billion per year from Biden's climate change programs.

Trump will realize major reforms in 2025 but not enough to cause significant damage to the NOVA real estate market. And I don't see "panic selling" like a run on the bank atmosphere happening.

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