I agree. In a given year only about 1/20th of the housing stock changes hands (5%). Paid to have the foundation, framing, electrical and rough plumbing done, and finished the rest themselves. I just moved from Nampa to a rental in Boise. Take the elevator to the street level at the BART Embarcadero next time when you are in the City. Numbers on new homes being offered are far greater than the ones marked as sold in the same time period. Most will be working their finances on the wrong end of this when it develops more. No losers if everyone is a landlord and tenant at same time. It soaks up (purchases) excess securities increasing their price and keeping rates down hence the increased size of their balance sheet. Wolf gets in some zingers at times too…the humor keeps me semi-sane, HA…, Charlie Sheen for Pres?—–>”Make winning great again!”. There is panic in apartment buildings. U cannot sell until he goes, because of tenants forbearance, his lease expiration date, or evictions freeze. Not everyone has a job and not every job is the kind that can get you a loan. It is about a family of criminals that live in a SoCal beachfront town. (LOL) Also, have been investing in gold and silver gradually since 2015 and dips along the way through last week… as some kind of protection – we hope. Sales went through some wild gyrations from 2009 through 2011. While the common refrain is that the $3 trillion the Fed printed ended up in the stock market, most of it is just sitting on the large banks’ balance sheets. This country is done for. Quaint concept, huh? Just look and the way these markets are behaving as they scream for a purge. Milwaukee Fire Department, US. The city is flooded with a historic amount of inventory, including a record-breaking number of condos for sale, and there is a large offering of vacant apartments, and rents have plunged, with one-bedroom rents down 19% in five months. The Covid virus has caused everyone to turn over their cards. Booming. Some people define the Bay Area to include Sacramento because you can go by Liberty Ship to Sacramento… so that’s in Central Valley. See our Privacy Policy, Housing Market Goes Nuts, Everyone Sees it, But it Can’t Last, Copyright © 2011 - 2020 Wolf Street Corp. All Rights Reserved. I guess summer is over in the north. you have to feel pretty comfortable in your current job, and it’s longevity in these uncertain times. The Fed represents Wall St and the banking cartel, and not Main St. Shenanigans You can talk about how it’s because of unions, or responsible corporate citizens, or whatever else, but the fact is, we had a virtual monopoly on manufacturing after the destruction of Europe’s capacity from World War 2. It’s an age thing as well. Compared to multi-family unit construction, single-family home construction has remained relatively flat since the market crash. Timing is nearly impossible, but in general it’s probably a good time to be a seller of assets and wait for better pricing. Why rent for so low? I would invite Wolf and others to contemplate this phenomenon from a slightly-different perspective…. Objectively that inventory chart is screaming for the prices to go higher, much higher. Because in that case, either the Fed would monetise the deficit, causing a doom loop of ever increasing inflation, leading to higher rates, or the Fed doesn’t, in which case the money gets tight by itself because the newly issued Treasuries will have to compete for scarce funds, which also causes rates to rise. I cannot believe Wolf let your comment stand. Imagine what will happen to housing prices once the central banks give every human on Earth a CBDC (Central Bank Digital Currency) account. It is likely to have a tiered interest rate attached to it, i.e. Last night, I was having a beer with a friend of mine who also has beach rentals. Basically, the Fed put is about people believing in it. What is the logic ?? At least in Illinois the houses aren’t going up much bc of our high taxes. The Fed most certainly DOES set the overnight rate, and furthermore can dictate the rate further out the yield curve by purchasing in the secondary market (which you may have noticed it has done on occasion). Gershom, keep in mind that during many serious downturns in markets, Fed was there pumping all they way…. Prices rose sharply during the period between 2005 and 2009 (when the market crashed) and then began to stabilize in 2013, leading to a steady increase thereafter. A hand-me-down from the heavens? Unfortunately, when they flee the urban nests they’ve soiled through their political choices, they soil the nest to which they flee as they have here in Colorado, once a reliably red state. Talk of vaccine is false advertising. In San Diego County, sales fell 40.7%, while the median price rose 3.5% to $590,000. Ya they are laundering but the plan doesn’t add up- they’re leaving too much cash on the table. I think it ends in inflation and great wealth inequality. Our subduction zone is capable of a 9.4M . I am thinking more in terms of disasters brought on by prolonged greed and manipulation and the fact that in nature “things” seems to seek to balance out somehow. Just follow the money. In Vancouver, easily 4-5K/month. However, it is likely that when the downside hits, prices will still be substantially higher than they are now. The snowbirds have arrived early in Naples, FL and they are bringing their cash to buy homes. Sept home sales were up 46% over Sept 2019. The problem with the cheapo version of house building is many never finish. The Bulgarian mafia in the emerald triangle launders it’s money in rentals in Chicago and Florida etc. China With WFH many buyers must be thinking this is their last chance in this life before everywhere gets too expensive. You’re prescient Pacifica. If you can’t buy assets with the dollar, it’s useless. What this really means is that the housing market may not get back on its feet in 2020, even if economic activity reopens. And he pointed out what everyone has already been pointing out, that “part of what is fueling this boom is that the economy has just split into two, and rich people are able to access capital almost for free, so, of course, they’re going to use that money to buy homes.”, But “there’s just another group of Americans who are still struggling, who can’t access the credit because we’ve raised credit standards, and you have high unemployment. At the end of WWII people could move from Brooklyn to the potato fields of Long Island in huge numbers because they had been renters. More than anything I wonder when businesses will leave? After the elections, there is no incentive to keep the forbearance going. Yeah, it is 27 F right now. ​The Assessor’s Office constantly monitors real estate market conditions and lowers assessed values on a mass basis. yes, greed and lust for power will tend to produce that effect. Nothing is worse than a having to unwind real estate quickly to raise cash. 4 to 1. I think this is the first one of your numbered lists I’ve seen that actually forms a list, albeit only in part (items 3, 4, 5 seem to be a list of “options”). if it arrives from offshore. They are thinking the exact same things they were thinking pre-pandemic. Since that time, there have been 19 recessions/depressions, that the Fed has been powerless to stop. And we won’t get a warning that it’s coming. Did you know Baghdad used to be one of the most advanced cities in the world under the Abbasid dynasty? 858-240-9900 2. If buying a home were financially easy, everyone would own one and demand would be almost ZERO. RE investors are geting the jump on the upcoming Fed’s UBI direct deposit through your bank account and onto to your landlord. The extent of virus/lockdown damage is not yet fully known yet. Less than 6% of the US population have a net worth of 2 million. Or as WOLF STREET commenter IdahoPotato called it vastly more accurately and unforgettably, the “FU-shaped recovery.” Meaning, people who got bailed out and enriched by the Fed’s $3 trillion that it threw at the markets to inflate the prices of stocks, bonds, housing, etc. Numerous businesses are relocating from California to Arizona. Here’s the problem with buying an overpriced house. Gas is nearly $5 a gal. Service first, market like no other. Spring is usually a busy time in the residential real estate market and 2020 was initially shaping up to be a bonanza for home sales in San Diego. Buying stocks right now feels like buying at a top. I am certainly concerned for the economy at large. The severe hangovers and indigestion is on the way. Dirt bikes left in the field. They examine things from the macro national perspective, so things can absolutely diverge from the narrative at the regional/local levels. Household income at $80k would be better than median. Phoenix is a horrible choice. People have short memories when it comes to markets. You live in the United Shoppers of America, or is it the United Sheeps of America. In some ways it’s a risk management problem with leverage. I had the cash I’d scraped together over the last few years and as much as I could borrow from my parents. I’m guessing there’s a better chance of seeing the commodities markets listing anti-matter then of these magic money fools awakening from a drug induced coma. We are going to buy a safer place. Nothing causes amnesia faster than a bubble, except for borrowing money…. It is a little sobering when you consider nearly twice that yearly percentage are now in forbearance, and it is conservative to say half or more of those will end up repossessed. Add “Cool Water” I think most of the expensive cities are going to suffer. But this is not a fashionable statement. The market does. I pay for literally bus-loads of kids to go to public school in states in which I do not even reside, as most of the property taxes are used for school funding. When the CBs bailed the market after the GFC it caught a lot of players out and many got permanently excluded. There have been certain indications, such as, changes to the federal interest rate or trade disputes that would lead to a slowing economy. When you consider the current supply-and-demand situation, … 2. I’ve heard that the auto dealers in Visalia and Selma are doing quite well also. If you look at the example above – its over 15x income. 3. San Francisco rents plunged by stunning 27% in 18 months. Problem with water? Then there’s the “single-asset” commercial mortgage-backed security (CMBS) backed only by the mortgage of this tower. 1. So $100,000 of digital currency, with just two genius CBDC plans, to drive home prices higher and higher toward housing bliss? Housing can become even more financialized while foreclosures are delayed for years, causing prices to remain elevated. “home sales” in the article maybe excluding condos? Have an emergency fund Paul January record low -41*F, mean low for January -15*F.. Average annual snowfall 54+ inches. Transportation It has never happened anywhere without a massive supply interruption first. Housing prices have escalated quite a bit in the past 3 years…. Kudos…most people get suckered into looking at household income (about 60k), which almost always means two workers these days. My portfolio of small old single family homes on big lots near the LA and OC beaches are soaring in value by more than 10% per year. When FED is the MARKET, there is NO place for logic. And then there are interest rates. They hardly worked, drank often, then came home to beat there wives and work their children. Definitely a sellers market. I knew he couldn’t stay away…. San Diego Real Estate Foreclosure Statistics Here are some foreclosure statistics of the San Diego real estate market. The most recovered markets for time-on-market include Los Angeles, San Diego, Louisville, Las Vegas, and Boston, with a pace of sales growth index between 133 and 161. — Yet Another Ponzi scheme. There is no tooth fairy. My wife and I sold our home of 20 years in June (we were all set to list in April as all was turnkey) to downscale several years after kids (in quotes) moved out. Marks to Market indeed .. ‘just one more spin at the roulette wheel, please. New defense orders will flow if BA cut their Everett assembly line and become more efficient, since the virus depleted the global demand for international and business travel by more than 60% Jobs Like 100K or more. “The economy has just split into two, and rich people are able to access capital almost for free.” And probably just pay the interest, no principle, which is zilch. Thanks you Alan Greenspan and Fed spawn. The Assessor may initiate the Prop 8 review. Could be worse as there was no virus that did damage in those years. 2) A large portion of the 8,000 workers will to sell their high values houses and rotate to bargain prices houses in the south. Shacks stay shacks and the kids move on. Every house I bought (3) had a mortgage and expense payment less than current rent in the neighbourhood. And suddenly that “housing shortage” has turned into a glut. (rhetorical). 4. Headline: “Low interest rates keep Twin Cities home sales rolling along.”, Minneapolis/St. Housing Market Crash In a game of Jenga, everything seems fine until the last piece is pulled. If I bought a place could I get a year off paying mortgage a few months after closing by crying forbearance? When is the MARKET, there is NO place for logic. Wolf, you have a very powerful name indeed.. But they’re losing $1200/month in revenue aren’t they? Yep, American “leadership” has done a helluva of a job over the last 65 years. I just hope I’m wrong. (E.G. We are due for the lean years which will break some things and put us on a different track. You just don’t get it… they do not print money…. So might as well pull back on the stock investments for a while and shift some investing into land. Ambrose, that’s not purely cynicism. To get back to trend would mean 66% drop. Non union wages is why mgmt. “The forecast for 2020 is quite robust in terms of property values.” My neighbor just did a huge remodel to attract a wife. If you have separate debts, try to pay off the debt with the highest interest first, even if it’s a small one, then work your way down the line to the next highest interest rate. if you’re smart you’ll bypass the pots and pans and take this feeling out on your wife or someone’s wife, and blow HER mind. more hospitalizations and incrementally more deaths. (I believe that is no longer true.) The definition of hyperinflation is inflation at 50% or above per month. Imagine we have another recession, poof, another $50,000 for anyone buying a larger, newer, more energy efficient home. About Europe, but equally applicable to the US: All of surviving big business is aligned with it: those who refused to play the game have disappeared. It does not mean that these homes don’t exist until someone puts them on the market. January 2020 San Diego Housing Market Update - Duration: 4:05. Author: Kelly Hessedal Published: 7:38 PM PDT April 23, 2020 Doesn’t it? That power pole sadly might be one of the few things that work without fail in the city, because the rest like public transport, etc certainly don’t. Brick & Mortar Meltdown This is quite the game of “extend and pretend” they got going here ???!!! Cuz they want to get TF out of California. But then the market for MBS and CMBS blew up and the Fed stepped in with the big guns.
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