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The U.S. Housing Boom Is Coming to an End, Starting in Dallas

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Re: The U.S. Housing Boom Is Coming to an End, Starting in Dallas

#101

Post by Latteland »

pfarnsworth wrote: post #52
systematical wrote: post #38

Older Millenial here. Bought my house while prices were still low in late 2013. Cashed out in March of this year. Thought it was crazy it was bubbling like this again. Time will tell if that was dumb or smart but I did pay off all my debt including student loans... I personally think a crash is coming soonish. But that's just my gut.

Almost everyone thinks a crash is coming. There has never been a crash where almost everyone has seen it coming. Therefore there will not be a crash at least in the near future. Prices might pullback but it won't be a crash.

But everyone thinks there's a recession and crash coming now, don't they?

Re: The U.S. Housing Boom Is Coming to an End, Starting in Dallas

#102

Post by lbacaj »

I believe we are seeing normal corrections in the housing market which has been overheated due to low interest rates. It is not some big conspiracy by the government and it is not a big collapse as some are making it out to be.

1/8th of a percent on a 30 year mortgage equals 80 dollars more per month on a 500k home, over 30 years, that is 28 grand more you are paying. The mortgage rates went from low 3% to high 5%, now even at 6%, in a matter of a few years. Of course this will cool the market a bit, people can do the math that much more in interest is hundreds of thousands.

This is very different from the 2008 crisis where people that had no business owning homes were defaulting on their loans. This is just supply and demand, standard capitalism. Home prices will come down a bit and they will start selling more homes.

Re: The U.S. Housing Boom Is Coming to an End, Starting in Dallas

#103

Post by pdonis »

austincheney wrote: post #76
pdonis wrote: post #29

Earlier quoted context omitted.

> The Federal Reserve (which orchestrates interest rates to manage inflation and achieve full employment [two of its mandates]) is not part of the US government Yes, it is. It's established by US statute, its board of governors is appointed by the President, and its personnel are paid by the US government. It is not considered part of any of the usual three branches of the US government (legislative, executive, judic…

To be fair you are both right. The board of directors is appointed by government officials and the bank was established by the Federal Reserve Act. The bank is also privately owned and not by any government. I learned this because a technology director at the Dallas bank works with me in our side job.

> The bank is also privately owned and not by any government.

Each of the Federal Reserve banks is structured on paper as a private corporation, yes. But the US government effectively controls what they do; the private corporations do not exercise any of the normal functions of ownership that other private corporations do.

Re: The U.S. Housing Boom Is Coming to an End, Starting in Dallas

#104

Post by gizmo686 »

ams6110 wrote: post #98
gizmo686 wrote: post #71

Earlier quoted context omitted.

How expensive is Ethernet to all rooms? That decision strikes me as a no brainer for any newly built house. Even if no one actually wants Ethernet in all rooms, it guarantees that Ethernet is present in the particular room(s) that the eventual buyer will want it in. And it will still be present in the particular room(s) that the next buyer will want it in. In contrast, if a room is missing Ethernet, it would be far m…

In 5 years, Ethernet outlets in homes will be like telephone outlets are today: a relic of a prior generation. I don't know anyone under age 50 who still has a landline phone. The next generation of home buyers won't know what an Ethernet cable is. Everything will be wireless. Apple doesn't even have Ethernet ports on their laptops anymore.

Wired connections are still needed for some professionals, and as we shift to more remote work (think remotely operating robots), the need for reliable network connections will increase.

Perhaps more importantly, wireless still connects to a wired router which needs to be somewhere in the house (unless we switch to more long-distance wireless, which I don't see happening anytime soon without both technical and political advances).

In my house, a major upgrade we did was install 3 additional access points, and we still have dead zones in one area because there was no Ethernet port (it would be 2, but one was a bedroom, so we ran a wire along the wall. Ugly, but bedrooms need wifi).

You are certainly correct that most people won't need Ethernet ports in every room

Re: The U.S. Housing Boom Is Coming to an End, Starting in Dallas

#105

Post by jameslk »

gowld wrote: post #75
jameslk wrote: post #25

Fed lowers interest rates with QE and home buying goes up. Fed raises interest rates and home buying goes down. Imagine that. Almost as if this could have all been predicted[0]. 0. https://en.wikipedia.org/wiki/Austrian_business_cycle_theory

Of course it's been predicted. Economists have predicted 9 of the last 7 recessions. But besides that, the Fed doing exactly what is was chartered to do and constantly issues press releases about is not a shocking revelation of hetereodox economics.

The Fed isn't doing exactly what it was chartered to do--it has had a dual mandate since 1977 that complicates its purpose. Regardless, the problem in this system seems more attributable to fractional reserve banking, which is force multiplier on the effects of central banks.

Re: The U.S. Housing Boom Is Coming to an End, Starting in Dallas

#106

Post by Gibbon1 »

bradleyjg wrote: post #11

The post housing crash housing boom was almost entirely the result of the federal government--which has made, guaranteed, or bought significantly more than half the residential mortgages since 2008--deciding there should be a housing boom. If it is indeed coming to an end it is because the federal government collectively has decided not to double down and keep the party going. This isn't the weather or even the price…

The government responded to the crisis with fiscal austerity and massive levels of QE. If you wanted to enrich the FIRE sector and screw working class people that would be exactly how to do it.

If you look at inflation by sector instead of focusing on nominal and ignoring everything else, you find asset bubbles on stocks, bonds, and real estate, no wage growth and low rates of nominal inflation.

Re: The U.S. Housing Boom Is Coming to an End, Starting in Dallas

#107

Post by mindslight »

sgc wrote: post #64
dnadler wrote: post #8

Earlier quoted context omitted.

It is, but incentives for the buyer's agent are already messed up. They want to close the deal, they don't really care about the price because the bump in their commission for a few extra thousand is nothing compared to the risk of not closing. Buyers will talk up their clients and seller will talk theirs down.

It's not as crazy as it seems. Usually the best thing to do is compromise to close, since the Buyer wants the house and the Seller wants to sell it. Buyers and sellers often overestimate the other side's patience and wear it to the bone, then lose a home/sale pointlessly. Presumably everybody is in contract because they want to do the deal, and agents work to make that happen. Agents do have a fiduciary relationship…

This sounds exactly like a narrative used to justify an ongoing conflict of interest.

For any piece of real estate, there's basically a price at which it would sell itself. People hire a real estate agent because they believe the agent will work to sell for more than that base price.

In my experience, both real estate agents represent the buyer as it is the buyer who is supplying the money. Your closing attorney is the professional more likely to represent your interests.

Re: The U.S. Housing Boom Is Coming to an End, Starting in Dallas

#108

Post by SomewhatLikely »

JumpCrisscross wrote: post #13

Housing prices go up: “it’s becoming unaffordable!” Housing prices go down: “it’s crashing!” Housing prices stay stable: “our leaders need to revitalise downtown!”

Housing prices go down: with these interest rates it's becoming even more unaffordable!

Re: The U.S. Housing Boom Is Coming to an End, Starting in Dallas

#109

Post by prawn »

froindt wrote: post #14
thinkingkong wrote: post #7

Earlier quoted context omitted.

Its not a conflict but its sort of weird. Sellers pay the commissions.

The buyer's agent is supposed to act in the best interest of the buyer. It's tough to say that's always the case when the buyer paying a bit more rather than walking away would actually help the buyer's agent earn more. Normally there are pre-negotiated commission rates the buyer's agent would receive. To ensure you've got someone who is truly on your side as the buyer, maybe it'd make sense for your agent to be paid…

Why would you even have a buyer's agent? In Australia, the seller has an agent (often on commission) to arrange ads and conduct opens. Buyers visit and then make an offer if they wish. A buyer's agent would be quite rare - maybe only for very, very expensive properties.

Does the buyer's agent in the US handle the role of a conveyancer in sorting paperwork of the final sale?

Re: The U.S. Housing Boom Is Coming to an End, Starting in Dallas

#110

Post by jiveturkey »

neokantian wrote: post #58

I am quite convinced it would be possible to build a pleasantly-looking development of $25,000 sale-value housing at 50 or 70 miles away from the urbanized area and connect it with a fast transit rail to the main urbanization. Empty land should be cheap. Buyers should be plentiful. The reason why this does not happen, is because the bureaucracy prevents it. There seems to be a strong political necessity to make accom…

others have destroyed your flight of fancy by detailing how expensive it is to drill a well, etc, but let me add one.

the cost of commuter rail service, never mind anything approaching high speed, utterly destroys your argument. it cannot be done.

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