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Homebuyers must ‘learn to live’ with near-7% mortgage rates says RE/MAX chairman

cnn.com

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Re: Homebuyers must ‘learn to live’ with near-7% mortgage rates says RE/MAX chairman

#31

Post by devonkim »

adamredwoods wrote: post #26
pkrecker wrote: post #3

"... for six to 18 months"

>> As of June, there were fewer than 800,000 housing units listed for sale across the country, down from nearly 1 million at this point in 2020, according to Realtor.com. At this point in 2018 and 2019 there were north of 1.2 million homes listed for sale. >> “For buyers, it’s been a tough go,” said Yun. “Not only have prices not fallen, there’s not much inventory.” As an active homeowner looking to relocate in Seatt…

We’re looking at a stagflation situation now where prices go up and wages and even underlying assets are supposed to be going down (cars and technically houses given they both depreciate as durable goods go).

Re: Homebuyers must ‘learn to live’ with near-7% mortgage rates says RE/MAX chairman

#32

Post by tryptophan »

oldgradstudent wrote: post #4
causality0 wrote: post #2

I'm constantly reminded to be thankful to be a homeowner in America. Most other countries don't even have fixed-rate mortgages and many of my international friends are facing massive unexpected jumps in their monthly housing costs.

And no prepayment penalties, which means that if interest rates go down, you can refinance.

How the fuck can it be illegal/penalized to ... pay back your debts? Nope sorry, we don't want your money back yet.

Re: Homebuyers must ‘learn to live’ with near-7% mortgage rates says RE/MAX chairman

#33

Post by boringg »

codampa01314 wrote: post #27

Another step closer to revolt. There's only so much pressure the general public will be able to handle. History has taught us when there is a massive unbalance in "haves" and "have nots" things don't play out in ways where we just "sit down and discuss what's going on."

Nah history has taught us mortgages can go way higher. Your part of the online crowd constantly trying to say the next French revolution is coming (been hearing that refrain since the 00s). Also when you buy a house - if you didnt factor in mortgage rates changing thats 95% on you. 6 % isnt even that high. Mortgage is too high offload and move elsewhere. People need to take some responsibility for their purchases.

Re: Homebuyers must ‘learn to live’ with near-7% mortgage rates says RE/MAX chairman

#34

Post by fxtentacle »

My personal prediction is that the higher interest rates will make companies and institutional investors withdraw from the housing market, especially office buildings. That would ease competition for land, thereby reducing housing prices for average citizens.

Re: Homebuyers must ‘learn to live’ with near-7% mortgage rates says RE/MAX chairman

#35

Post by itake »

interactivecode wrote: post #6
causality0 wrote: post #2

I'm constantly reminded to be thankful to be a homeowner in America. Most other countries don't even have fixed-rate mortgages and many of my international friends are facing massive unexpected jumps in their monthly housing costs.

Can you imagine having such unexpected jumps in housing costs and not even owning your home? That would be way way worse

Can you explain this more? When I rented, I paid a flat rate. When rent increased, it only went up 10% at max.

Now that I am a homeowner with a 30y fixed mortage, I have many unexpected jumps (thousands in home repairs, increasing property taxes and insurance). Unexpected jumps are way bigger as a home owner than they ever were as a renter.

Oh, and my house value has dropped $100k since I bought it.

Re: Homebuyers must ‘learn to live’ with near-7% mortgage rates says RE/MAX chairman

#36

Post by EricDeb »

causality0 wrote: post #2

I'm constantly reminded to be thankful to be a homeowner in America. Most other countries don't even have fixed-rate mortgages and many of my international friends are facing massive unexpected jumps in their monthly housing costs.

Fixed rate means houses on the whole are more expensive though

Re: Homebuyers must ‘learn to live’ with near-7% mortgage rates says RE/MAX chairman

#37

Post by dudul »

codampa01314 wrote: post #27

Another step closer to revolt. There's only so much pressure the general public will be able to handle. History has taught us when there is a massive unbalance in "haves" and "have nots" things don't play out in ways where we just "sit down and discuss what's going on."

Is that what History taught us? I thought it taught us that humanity could go for literally centuries with a minuscule group of elites owning everything and the rest of the population owning nothing more than their clothes.

Re: Homebuyers must ‘learn to live’ with near-7% mortgage rates says RE/MAX chairman

#38

Post by pierat »

Easy enough.

Then as a seller, I'm lowering the buyer's fees to 0% , and then negotiating my seller's agent as 4%.

There's no way, as a seller, that I'm going to willingly pay the buyer's real estate agent any money. That's the buyer's job, not mine.

Re: Homebuyers must ‘learn to live’ with near-7% mortgage rates says RE/MAX chairman

#39

Post by seanmcdirmid »

AnimalMuppet wrote: post #20

Home sellers must also learn to live with near-7% mortgage rates. Since the price that the buyer can afford is often set by the monthly payments, the price that most buyers can pay will go down.

The selling price will always be set by the market. Sellers with great interest rates will also be less likely to sell since they can’t turn the rate over in their next home purchase. It’s like proposition 13 all over again, except no boomer exemption.

Re: Homebuyers must ‘learn to live’ with near-7% mortgage rates says RE/MAX chairman

#40

Post by majormajor »

The headline is awful - the longer sentence is in the article: '“We’re just going to have to learn to live with 6.5% or 7% mortgage rates for six to 18 months,” said Liniger.'

The headline is also awful because before 2008 those would be good rates anyway.

If you bet on the 2020-2021 trend continuing you could be in a bad place now, but... that was a weird trend to bet on continuing given the COVID factors that are now largely back to normal. I'm not one to classify the past as some sort of "stable" period that we've now dangerously shifted away from - 1970 was different than 1960 was different than 1980, etc, in so many economic factors - but it's always good to be skeptical of those guaranteeing that the trend will go one way long-term, whether that's "imminent bust" or "imminent boom."

If you weren't able to get in on low rates then, they also likely wouldn't be helping you that much now since prices are only falling slowly. Any downward correction is likely to be a slow painful process since these buyers were generally more financially buttoned-up than the mid-2000s ones were, and will want to ride things out vs sell for huge discounts.

Would higher rates slowly discourage some of the hedge-fund/PE invasion of residential real estate, though?

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