patrick.net

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AirBnB's IPO price was $139 in December 2020. Its price now is $129.

In February 2021 its all time high was $213. In December 2023 its all time low was $85.

Since October 2022 the 30 yr mortgage rate has been around 7%.

It was 5% in October 2018, 3.5% in January 2020, and 3% in September 2021.

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https://www.axios.com/2025/05/31/second-home-mortgages

Demand for second homes is at its lowest in data going back to 2018, Redfin reports.

Why it matters: Vacation homes are losing their luster.

Homeownership costs have soared, and cities are cracking down on short-term rentals.

Plus, fewer people can work remotely from their beach house or ski chalet these days.

Mortgages for second homes fell from the previous year in 30 of the 50 most populous metros, led by Miami (-32%), Orlando (-28%) and Fort Lauderdale (-28%).

AD says

So you currently have 62 year to 67 year olds retiring now and still moving to Sun Belt.

They already moved. Covid spurred that. Also some can't afford to retire and will work forever. Those that can retire already have and made their move. Teachers, fire fighters, cops, and any government worker has retired. Probably around 55-60 which is basically a decade ago.

They also bought in at low interest rates and the homes they bought to downsize won't be sold for 15-30 years, basically until they die. Or they bought with cash. Or some just stayed in their paid off house and one of the kids live with them. There are no houses for sale is the point.

Prices won't meaningfully go down until inventory is up or more building or both. Interest rates would need to get to 14-17% so I don't put that in the equation. Not happening.

WookieMan says

Also some can't afford to retire and will work forever.

So those that are 62 to 65 years old and living in Democrat shitholes like Illinois can't retire and are stuck there ?

This demographic did not earn guvmint pensions (fed, state, county/town) and did not have enough money in retirement accounts like 401K and Roth IRA.

And those in that age group who had guvmint pensions already retired at 55 to 58 years of age and already moved to the Sun Belt.

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AD says

This demographic did not earn guvmint pensions (fed, state, county/town) and did not have enough money in retirement accounts like 401K and Roth IRA.

You're a stat guy. Look up the people that actually saved anything. It's way lower than anyone thinks. My 48 year old buddy has NOTHING saved. His checking account gets big and then small. 11 years from what is retirement age.

Most people currently at retirement age saved nothing. At least nothing much. Go to a restaurant, home depot, Kohls, Target, etc. it's all 55+ workers for the most part.

Save early save often. My friend I just mentioned just buys toys. 4 wheelers, side by side, camper, etc. If he had invested that he'd easily have $400k in retirement funds. He has $0 for retirement. Not a big sum, but that would probably be $1M in 11 years if he had invested. He's now breeding his horses paying $6k for horse semen. Not a joke. I'm just like dude, you're broke for your age. He doesn't know how to invest.

Anyone with kids should start him/her working as soon as possible to fund however meagerly a Roth IRA. After 5 years, you can withdraw contributions for whatever reason tax free. Earnings are a no-no unless they are used for medical, college, first time home purchase. Get the critters to work to fund the minimum balance necessary to establish a Roth IRA. Remember - it doesn't count for financial aid for college.

stereotomy says

Anyone with kids should start him/her working as soon as possible to fund however meagerly a Roth IRA. After 5 years, you can withdraw contributions for whatever reason tax free. Earnings are a no-no unless they are used for medical, college, first time home purchase. Get the critters to work to fund the minimum balance necessary to establish a Roth IRA. Remember - it doesn't count for financial aid for college.

True, I was looking at Substantially Equal Periodic Payment, which the IRS allows you to withdraw at least 5% per year without penalty.

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WookieMan says

You're a stat guy. Look up the people that actually saved anything. It's way lower than anyone thinks. My 48 year old buddy has NOTHING saved. His checking account gets big and then small. 11 years from what is retirement age.

Most people currently at retirement age saved nothing. At least nothing much. Go to a restaurant, home depot, Kohls, Target, etc. it's all 55+ workers for the most part.

Save early save often. My friend I just mentioned just buys toys. 4 wheelers, side by side, camper, etc. If he had invested that he'd easily have $400k in retirement funds. He has $0 for retirement. Not a big sum, but that would probably be $1M in 11 years if he had invested. He's now breeding his horses paying $6k for horse semen. Not a joke. I'm just like dude, you're broke for your age. He doesn't know how to invest.

Yup. I know a few of those who own a Time Share. One such person in his mid 50's owns THREE of them.

AD says

When those born in 1964 turn 65 then the spigot is nearly fully turned off as far as the migration of baby boomers to the Sun Belt.

Yep, Florida migration down 80%, and big drops are being seen across the Sunbelt.

Wow, did flippers dump. I just saw 3 of 5 listings that are rehabs of older houses abandoned right in the middle. Hampton Bays or whatever the Home Depot brand unfinished kitchen stuff in, half-vinyl planked floors abandoned halfway in, another room with new contractor special tile next to another with rose carpet, one bathroom new generic grey the other one pink toilet and sink, some new fans the other fans from the year Peter Frampton Came Alive, etc.

Also saw TWO (2) Space Race 60s-built Homes being dumped for less than 200k by millennial inheritors! They want out!

Rents easily down 30% since COVID. Apartment complexes offering a 1-2 free months and discounts for major local employers; and obvious ex-AirBNBs (Welcome Guests to 123 Fart Street in script font near door, etc.) trying to outbid each other for rock bottom rents.

Hey hey mama prices goin' down
they're goin' down
*Guitar slide*
https://youtu.be/Ka_ALgG9hqY?si=Cu0cdOol7CHzWWkC&t=53

AmericanKulak says

Also saw TWO (2) Space Race 60s-built Homes being dumped for less than 200k by millennial inheritors! They want out!

None of my 35-42ish peers want to live in FL. The ones that did move left within 2 years after getting there. Same with TX. AZ, CO and MT are sticking with Illinoisans. WI, TN and IN are close as well, though not as popular, more for a property tax move, though WI is starting to get up there on property taxes.

Example of half refurbished Apollo House
https://www.zillow.com/homedetails/1042-Alamanda-Ln-Cocoa-FL-32922/43412352_zpid/

WookieMan says

None of my 35-42ish peers want to live in FL. The ones that did move left within 2 years after getting there. Same with TX. AZ, CO and MT are sticking with Illinoisans. WI, TN and IN are close as well, though not as popular, more for a property tax move, though WI is starting to get up there on property taxes.

Correct. That's why inheritors are going to sell, sell, sell. Esp. since the wages and industry breadth in Florida is pitiful compared to just about any state - even neighboring Alabama and Georgia have far better pay. Hell, WV and AR have better health care pay while far cheaper cost of living.

FL property tax and insurance has skyrocketed, too, some of the biggest increases in the nation and now comparable to the rest of the Coastal states.

That's why DeSantis and the FL legislature is worried about property tax. Old people are on a very fixed income, Jerry.

zzyzzx says

Oh very yes, what do those hot markets have in common, like spicy curry?

AmericanKulak says

Example of half refurbished Apollo House
https://www.zillow.com/homedetails/1042-Alamanda-Ln-Cocoa-FL-32922/43412352_zpid/

5 bedrooms in a 1,400 square foot house. Haha. This is an example of goosing the numbers/stats.

We've built about a million units a year for 30 years. What we haven't built is modest starter homes, mostly multifamily on one hand and Zero Lot McMansions on the other.

Many Millies don't own a home at all yet, Boomers if anything will downsize, or be forced to downsize as they age.

AmericanKulak says

Many Millies don't own a home at all yet, Boomers if anything will downsize, or be forced to downsize as they age.

I don't have a friend 38-42 that doesn't own. They all own. Mind you this is IL. Cheaper cost of living generally.

Millennials moved to where it was hip, hot and sunny. Those that stayed back just picked up the scraps after the bust. I owned my first property 20 years ago. Then picked up a winner where I currently am at, but will be moving down the street.

Santa Cruz is coming down, too. The fires a couple of years ago spiked prices almost double, because people were burned out and needed housing, or just wanted to get to the flats where the fire hazards weren't as high (these were real lightening fires and not DEW).

Also, the work at home Covid stuff drove a lot of tekkies to Santa Cruz where they could work in their bunny slippers and enjoy the beach while running up real estate prices. It seems that those trends are now deflating a bit, especially with the higher mortgage rates.

We went to look at a 1500 sq. ft townhouse @ 1.1 million. It had been valued at 1.5 million in the summer of 2020.

A lot of people in CA have trouble getting insurance at all in fire hazard areas. The insurance companies send out drones now, and either adjust or increase rates if there are too many close trees or overhanging branches. A couple of our neighbors in Tri Valley got 'droned' out of their insurance coverage. Ours just went up by a third.

There also appears to be a leak to the insurers about pending DEW/HAARP right of way and eminent domain attacks, or the same Guv and Freemason insiders also are privy or invested with the insurance companies. A lot of homeowners said there were a lot of sudden unexplained cancellations of homeowner insurance a couple of months in Pacific Palisades before the area was razed by DEW weapons.

But...BUT..I was told https://patrick.net/post/1383080/2025-01-03-housing-prices-will-not-go-down

by a genuine Housing Expert on PatNet!

@Ceffer - Valued or listed?

“We went to look at a 1500 sq. ft townhouse @ 1.1 million. It had been valued at 1.5 million in the summer of 2020.”

Glock-n-Load says

Ceffer - Valued or listed?

“We went to look at a 1500 sq. ft townhouse 1.1 million. It had been valued at 1.5 million in the summer of 2020.”

Comps are based on one or two car garage and single vs. two story. They listed it a couple of years ago for 1.4 million in 2023 when the market had peaked at 2022 and already started to go down. They then withdrew it from the market. A Capitola address is a couple of hundred thousand dollar bump automatically because of cachet over Live Oak. House has a shared wall off the garage aka townhouse rather than separate. Price actually 1.149 Mill asking. Built 1980, so insulation is probably poor but entire insides were renovated a few years ago and appliances/water heater etc. updated, really nice on insides and nothing to be done otherwise. They also added earthquake protection by reinforcing the studs at the foundation.

So the Zestimate was 1.4 in 2023? Sorry, just trying to understand where the value calculation is coming from.

The housing bubble is collapsing.



https://www.zerohedge.com/markets/nearly-half-700b-homes-sale-have-gone-stale-sellers-outnumber-buyers-500k

The_Deplorable says

The housing bubble is collapsing.

And where did they come up with this number? Scanned the article and it just kept repeating the same thing over and over. Houses are worth more than 2012 values, of course the number is going to be higher. No one wanted to even leave their house in 2020 because covid. That graph is trending correctly outside of the covid blip.

Also does this account for contingent houses? People buy in spring and close in June mostly once the kids are out of school.

And how do they know how many buyers are in the market? Loan applications only apply to about 70% of buyers and probably less now. Others are cash or have other means to buy so that number doesn't say much when you can't count the true numbers of buyers. There are more cash buyers than ever buying up the cheaper properties as investment than the expensive ones as primary residences. Basically they don't know.

Inventory is the only metric that matters and that only matters in your local region. National numbers simply don't matter. California is having an exodus. The insurance is going through the roof on already high property values. Say 20,000 families or seniors want to leave CA with houses valued at $1M, that's $2T. Not saying 20,000 are listed at that price, but just to show the value. There are plenty of $1M houses. That monthly nut with 17% insurance increases is gonna hurt the 60+ crowd and they might have to sell.

My point is it's senseless to track national stats. Also AI could be hurting the tech sector on the west coast and people are getting laid off and can't afford their expensive homes anymore. CA is the 5th largest GDP state or country (I know not country) in the world. It has too much influence on national stats and should be removed from any analysis and just analyze just CA alone. Do just the other 49 and these graphs are significantly different in the article.

These doom and gloom articles are click bait. Considering it's Redfin, they're just trying to get leads saying the classic "it's a good time to buy" mantra in the Realtor world because there are more sellers. They make more money off buyers, they're a low listing commission brokerage. There's a lot that's non-sensical basically in the article. Reading about RE and doing it for over 15 years like myself are two different things.

The_Deplorable says

The housing bubble is collapsing.

The median home sale price rose 1.6% year over year to $431,931 in April.

It must be due to the inflation that the article missed to mention!
This is after mortgage rate more than 6%, still not a good news for the buyers yet so far.

WookieMan says

California is having an exodus.

I saw your remark and typed this AI query into the browser on my computer: "population change of california in past year". Here is the AI generated response:

"In 2024, the population of California was 39.43 million, a 0.59% increase year-by-year from 2023. Previously, in 2023, California's population was 39.2 million, an increase of 0.14% compared to a population of 39.14 million in 2022."

I wish you were right about the exodus as it's too crowded here. Maybe you think the AI on my computer is a liar and you know more. Whatever.

I do agree with your premise of your point because I know some of the exodus folks you speak of. But for the time being they're being replaced by new folks who either arrive by birth or immigration.

Many of the exodus folks you referenced are retirees who will sell their homes to fund their out-of-state retirements. I know some of those, my homies who left for Cheaper Pastures. If they purchased decades ago for a fraction of what they sold for, who thinks they stress if the gain on the sale of their home is only 300% instead of 350%? Then they are either replaced by younger folks who have a lot of cash from their RSU's in tech companies or got ill gotten cash from "back home" in Asia, or else over-borrowed to over-pay for the "privilege" to pay an ownership premium of 80-100% over renting.

Readers of this blog may recall posts by a tech worker with the handle "BayArea" who bellyached on this site about the high cost of housing here till he became such a privileged homeowner in the leafy Tri-Valley who "bought at the peak" a couple of years ago. Since then he dropped off the blog.

Blue says

The median home sale price rose 1.6% year over year to $431,931 in April.

In a nation of over 300 million that spans the continent it's kind of a meaningless statistic.

Patrick is here in the Bay Area. His blog was originally focused on Bay Area housing.

Here is a recent blog post by Bay Area resident Wolf Richter: https://wolfstreet.com/2025/05/21/as-tech-jobs-plunge-in-san-francisco-silicon-valley-housing-reacts-condo-prices-drop-back-to-2015-single-family-home-prices-back-to-2018/

According to the real estate websites Z*llow and R*dfin, the value of my sh*tbox in San Jose is down about 10 - 15% from the peak of a couple of years ago.

Do I care? Sort of. It's not down enough. I'd like to see values in these parts go down 50% from here to make life less miserable for working class folks.
But that's a fantasy because unless some laws are changed, we know what would happen in that case. Like in the 2008 crisis, the Rentier Class of folks like iwog and Eman will jump in and scoop up to exploit working class folks.

https://fortune.com/2025/05/30/housing-market-more-sellers-than-buyers/

There are 500,000 more people selling their homes in the U.S. than those looking to buy them

zzyzzx says

https://fortune.com/2025/05/30/housing-market-more-sellers-than-buyers/

There are 500,000 more people selling their homes in the U.S. than those looking to buy them

How do they know? We all know how the polls went in 2016. Not good for pollsters.

I have no pony in the race. A small but good percentage of Boomers have a lot of cash. My uncle bought all 3 of my cousins properties cash. Other uncle bought two, all cash.

One person posts an article like this and everyone runs with it as click bait. NO ONE knows how many buyers there are out there. It's not like they announce when they're in the market and fill out a form "hey I'm buying." Not how it works. They're looking at search data and 90% of that is tire kickers. I search for used cars all the time. Haven't bought in 12 years.

If inventory, NOT NATIONALLY, is under 6 months it's 100% a sellers market. The worst I saw in my market during the OG bust was 12 months. We're not remotely close to that. In my town the 3x's rule or up to 5x's median family income gets you a new build. Would I buy it, hell no, but a young family would and are.

Cities and coastal areas are gonna skew any reductions in NATIONAL values. Makes for easy clickbait. People are moving out of cities and as BACHA says even certain suburban/city areas are getting too crowded. Toss in big changes in big markets and you have flight. A home in certain parts of CA is close to being uninsurable or cost as much as the mortgage payment. Seniors and younger people can't afford that. So that leave 70's and 80's born people to buy up expensive inventory or foreigners as he mentioned.

People are going to move to more rural areas. Urban areas is where a "crash" might happen. If you bought 5 years or more ago there's still probably equity in the property. If you move to a low cost region or area, it's still a win even if you didn't get as much as you wanted on your sale.

zzyzzx says

There are 500,000 more people selling their homes in the U.S. than those looking to buy them

I wonder if that includes Builders?

Going to hit the 40 million mark any day now. Just two more weeks...
Between July 2023 and July 2024, California experienced a net out-migration of 239,575 US citizens. This means that more residents moved away from California to other states than moved into the state from other states. This out-migration was partially offset by a net gain of 361,057 international immigrants.

B.A.C.A.H. says

Then they are either replaced by younger folks who have a lot of cash from their RSU's in tech companies or got ill gotten cash from "back home" in Asia, or else over-borrowed to over-pay for the "privilege" to pay an ownership premium of 80-100% over renting.

Is there an endless supply of those with "ill gotten cash from Asia" ? what is the breakdown of this as far as country ? is it mostly China ?

I look at how well tech stocks are doing to gauge the supply of younger folks with cash (from their RSU's in tech companies).

And when the S&P 500 has a lackluster year, that tells me its not good for California's economy especially its state government finances.

California is projected to have at least a $47 billion deficit this year. I hope that grows larger if Trump cuts more to Medicaid and other social services. About 40% of Californians are on Medicaid.

.

The 3 bedroom, 2 car garage townhome unit at 1610 Annabellas Way Panama City Beach is no longer listed at $1800 as it looks like it may have a tenant based on Zillow

estimated cost per month to lease is around $1080 
$420 HOA 
$160 insurance
$150 taxes 
$150 maintenance and repair
$200 property manager 

so based on 90% occupancy the monthly profit is $540

($1800x0.9) - $1080 = $540

or $6480 annual profit 

divide that $6480 by 4% and the estimated home value is $162,000

so a 4% annual ROI on $162,000 is $6480

assume home annual appreciation of 3.5%, add that 3.5% to the 4% and the worst case annual ROI is 7.5% 

and if done right with depreciation and other tax advantages, that 7.5% annual ROI can easily be 100% tax free 

If rent was $2000 then the estimated home value would be $216,000

3 bedroom units in the Annabellas Townhomes HOA were easily renting for $2000 in 2022

EBGuy says

Going to hit the 40 million mark any day now. Just two more weeks

EBGuy, I wonder if you are Eman

California is like Illinois as far as population growth rate. New home construction accordingly should be at a slow rate unless there is a considerable supply of +75 year old homes that cannot be refurbished/modernized and salvaged.

2011 37,636,311
2012 37,944,551
2013 38,253,768
2014 38,586,706
2015 38,904,296
2016 39,149,186
2017 39,337,785
2018 39,437,463
2019 39,437,610
2020 39,538,223
2021 39,142,565
2022 39,142,414
2023 39,198,693
2024 39,431,263 (estimated)

AmericanKulak says

zzyzzx says
There are 500,000 more people selling their homes in the U.S. than those looking to buy them

I wonder if that includes Builders?

Yeah, I think number of sellers is based on number of housing units (single detached, townhome, condo) for sale, so an independent builder that may have 20 units unsold and that counts as 20 sellers

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a lot of you guys count appreciation, which works in blue states and big cities. best part about country though, is no appreciation. keeps all the speculators from buying to rent because it barely pencils out. otherwise it would be same rat race and government policies that want renters instead of owners like they have in blue states.

Fortwaye says

a lot of you guys count appreciation, which works in blue states and big cities. best part about country though, is no appreciation. keeps all the speculators from buying to rent because it barely pencils out. otherwise it would be same rat race and government policies that want renters instead of owners like they have in blue states.

Yes, appreciation of housing value just means more housing inflation.

But even at a rate of 3% that is sustainable assuming overall annual inflation is around 2%.

It all costs down to affordability and living standard or living conditions. This would mean less illegal immigrants overcrowding of homes such as in Manassas Park, Virginia.

Hopefully we are not in a spiral down as far as quality of life or standard of living.

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california was illegal haven, and it had massive housing inflation. i do think 2 are related. it doesn’t keep them out.

WookieMan says

"And how do they know how many buyers are in the market?"

From Real Estate Agents/offices. Is that rocket science?

Fortune: There are 500,000 more people selling their homes in the U.S. than those looking to buy them

WookieMan says

"How do they know?"

From Real Estate Agents/offices.

The_Deplorable says

Fortune: There are 500,000 more people selling their homes in the U.S. than those looking to buy them

WookieMan says
"How do they know?"

From Real Estate Agents/offices.

The number of buyers is not reported. No one ever asked our office about buyers ever. Listings are the only metric that can be tracked mostly via entry into MLS systems. Plenty of agents get buyers at open houses how could they be reported if they don't follow up?

There's no way to track the number of buyers. It's likely based off search result algorithms and loan applications. I built my house so technically a buyer. My mom bought my house. At what point were we counted as buyers? Never. Cash buyer. Never counted.

It's clickbait. I wrote our monthly newsletter for 15 years. I participated in the clickbait. They might do a sample of randoms and extrapolated from there, but that's inaccurate no different than election polls. We have no idea how many buyers there are.

Links for zerohedge, Redin and Fortune all saying the exact same headline means nothing. SHOW me where the data comes from. No one can. Not links with copied articles. The actual data, not random analysis and guessing with no proof. That's what these articles are.