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Homes in 97% of U.S. cities are overvalued, Moody's says

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Re: Homes in 97% of U.S. cities are overvalued, Moody's says

#31

Post by DoubleDerper »

mogadsheu wrote: post #9
melissalobos wrote: post #4

Isn't this one of those "If everyone is crazy, you're crazy" situations? If every house is overvalued by some metric, then maybe the metric is wrong. People's perceptions of value are a large part of the actual value(meaning what someone would really pay) for things like housing that should depreciate over time.

No because houses as an asset class could still be overvalued relative to other assets.

Relative to which assets?

Stocks? Cars? Forex? IP? Crypto?

Genuinely curious because everything is more expensive than it was before.

If everything is overvalued, then nothing is overvalued [relatively]

Re: Homes in 97% of U.S. cities are overvalued, Moody's says

#32

Post by donavanm »

avelis wrote: post #2

It doesn't help that corporations buy all these houses up at full price and well above listing just so they can use it as rental income.

This is absolutely not true. “Investor” properties account for about 18% of secondary home sales. 90% of those sales are to individuals with 1-4 properties. The remaining 10% of investor sales, ~2% of the total, is ALL of the professional invesotr purchases. Its billions of dollars, in a trillion dollar market.

Re: Homes in 97% of U.S. cities are overvalued, Moody's says

#33

Post by fraa-orolo »

hammock wrote: post #20
torbTurret wrote: post #15

Earlier quoted context omitted.

Such a simple analysis ignores e.g. the higher wages in the US offset by the lack of social nets

The bigger reason is you can buy a house with 20% down (or less) in the US, where that is nearly impossible just about anywhere else in the world Edit: I should say anyone can buy a house for 20% down or less. In much of the world some can do this, but credit is not extended to nearly as many of the population as it is in the US

I just bought an apartment with 15% down. It's in the EU; 15% down is about the standard here with no special exceptions.

With government assistance programmes it can be even 5% down but you'd have to qualify for some protected category.

Re: Homes in 97% of U.S. cities are overvalued, Moody's says

#35

Post by throwyawayyyy »

hammock wrote: post #20
torbTurret wrote: post #15

Earlier quoted context omitted.

Such a simple analysis ignores e.g. the higher wages in the US offset by the lack of social nets

The bigger reason is you can buy a house with 20% down (or less) in the US, where that is nearly impossible just about anywhere else in the world Edit: I should say anyone can buy a house for 20% down or less. In much of the world some can do this, but credit is not extended to nearly as many of the population as it is in the US

I'm surprised. I only know the US and the UK, but in the UK it can go down as far as a 5% deposit. Honestly US deposit requirements seem high.

Re: Homes in 97% of U.S. cities are overvalued, Moody's says

#36

Post by pm90 »

coward123 wrote: post #7

I can’t help but think of that saying “the market can stay irrational longer than you can stay solvent.” Yes, prices in many markets are very high and appreciating at a rapid clip, but if there are buyers, competition, and houses are continuing to move quickly, then it’s a bold statement to say they are overvalued and that we should predict a significant decline.

> but if there are buyers, competition, and houses are continuing to move quickly,

They’re not though. Thats the whole problem.

Asset bubbles can inflate the paper value and there might still be some trading activity. But if nobody can actually buy the asset, it’s pretty much useless.

Re: Homes in 97% of U.S. cities are overvalued, Moody's says

#37

Post by ianhawes »

avelis wrote: post #2

It doesn't help that corporations buy all these houses up at full price and well above listing just so they can use it as rental income.

I’ve heard this but I’ve not experienced it. If corporations are buying houses and using it as rental income, they’re probably losing money. Ignoring vacation rentals, detached homes are among the hardest to rent.

Re: Homes in 97% of U.S. cities are overvalued, Moody's says

#38

Post by Patrol8394 »

hammock wrote: post #20
torbTurret wrote: post #15

Earlier quoted context omitted.

Such a simple analysis ignores e.g. the higher wages in the US offset by the lack of social nets

The bigger reason is you can buy a house with 20% down (or less) in the US, where that is nearly impossible just about anywhere else in the world Edit: I should say anyone can buy a house for 20% down or less. In much of the world some can do this, but credit is not extended to nearly as many of the population as it is in the US

> that is nearly impossible just about anywhere else in the world

I don't know about "anywhere else in the world" but I can guarantee you that you can buy a property everywhere in EU with a 20%. Also, property taxes in EU are generally lower than US.

I keep saying that americans, pay lots of taxes, they are simply not aware of it.

Re: Homes in 97% of U.S. cities are overvalued, Moody's says

#39

Post by toomuchtodo »

fraa-orolo wrote: post #33
hammock wrote: post #20

Earlier quoted context omitted.

The bigger reason is you can buy a house with 20% down (or less) in the US, where that is nearly impossible just about anywhere else in the world Edit: I should say anyone can buy a house for 20% down or less. In much of the world some can do this, but credit is not extended to nearly as many of the population as it is in the US

I just bought an apartment with 15% down. It's in the EU; 15% down is about the standard here with no special exceptions. With government assistance programmes it can be even 5% down but you'd have to qualify for some protected category.

How long is the rate fixed for?

Re: Homes in 97% of U.S. cities are overvalued, Moody's says

#40

Post by alimov »

DoubleDerper wrote: post #31
mogadsheu wrote: post #9

Earlier quoted context omitted.

No because houses as an asset class could still be overvalued relative to other assets.

Relative to which assets? Stocks? Cars? Forex? IP? Crypto? Genuinely curious because everything is more expensive than it was before. If everything is overvalued, then nothing is overvalued [relatively]

> If everything is overvalued, then nothing is overvalued [relatively]

Could it be that maybe peoples work is under valued relative to the value they help create?

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