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The housing market is starting to crack – Sellers are cutting prices

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Re: The housing market is starting to crack – Sellers are cutting prices

#131

Post by pixl97 »

analyte123 wrote: post #79
jeffreyrogers wrote: post #33

Unless the housing supply increases this will just be a temporary thing. As long as people are able to make their mortgage payments they typically won't sell their homes at a loss (even if their equity is negative). Some people will always be forced to sell due to life events and that's what will set current market comps. Since mortgage rates have recently spiked upwards people who need a mortgage to buy a home can a…

There are a record number of housing units under construction: https://fred.stlouisfed.org/series/UNDCONTSA/

If you look at the dip before now, it's because we're a record number of housing starts behind. We pretty much stopped building houses in 2008.

Re: The housing market is starting to crack – Sellers are cutting prices

#132

Post by pixl97 »

jfengel wrote: post #48
jeffreyrogers wrote: post #33

Unless the housing supply increases this will just be a temporary thing. As long as people are able to make their mortgage payments they typically won't sell their homes at a loss (even if their equity is negative). Some people will always be forced to sell due to life events and that's what will set current market comps. Since mortgage rates have recently spiked upwards people who need a mortgage to buy a home can a…

I'm afraid I don't follow that. House-sellers are generally also house-buyers. They move out of one place into another. It's neutral with respect to supply. If there's a glut of people owning houses but not living in them and not successfully renting them, then that does reduce supply, but they're also suffering opportunity cost. If they're willing to throw away money like that I don't think increasing supply would h…

The census bureau estimates around 11% of houses in the US.

Re: The housing market is starting to crack – Sellers are cutting prices

#133

Post by pixl97 »

jjav wrote: post #130
spaceflunky wrote: post #115

Earlier quoted context omitted.

>Unless the housing supply increases this will just be a temporary thing. The housing supply will increase dramatically in the next decade, not by building but by attrition. More than 55% of all homes in America are owned by Silent Gens or Boomers[0]. That figure includes non-SFHs, of SFHs I've read they own >70% of (lost my source unfortunately). They are going to start dying of en masse within the next decade. That…

> The share of millenials and genzers who are financially fit to even purchase a home are going to be far less than the amount of people who are dying. I don't understand this sentence. The number of houses that get sold or transferred to living people is of course exactly the same as the number of houses vacated by people who died. It can't be anything else since houses don't evaporate when the owner dies.

Just because you die doesn't mean your house is paid off or you don't have some kind of reverse mortgage on it.

Just the yearly taxes on my home would be a significant burden to many.

Re: The housing market is starting to crack – Sellers are cutting prices

#134

Post by vkou »

lotsofpulp wrote: post #83
carlosjobim wrote: post #62

Earlier quoted context omitted.

The main "forced sell" event is that people die. Yet prices are not coming down even in countries with stable or rapidly declining populations. So shortage it isn't.

Which country has a rapidly declining population?

Not the United States. It's looking to pick up 40 million more people in the next 30 years.

Re: The housing market is starting to crack – Sellers are cutting prices

#135

Post by vkou »

carlosjobim wrote: post #92
lotsofpulp wrote: post #83

Earlier quoted context omitted.

Which country has a rapidly declining population?

Most of the planet has below-replacement birth rates currently in a rapidly declining trend. These declining birth rates are not only leading to rapidly declining population, but to exponentially declining population. Right now, most homes that should be for families are inhabited by one or two elderly persons, while almost all real estate worldwide is owned by the elderly or abstractions they control, such as funds…

> Most of the planet has below-replacement birth rates currently in a rapidly declining trend.

No, most of the planet has above-replacement birth rates.

The developed world has below-replacement birth rates.

People migrate from the former to the latter, resulting in net population growth in ~nearly country in the world.

There are only a handful of countries experiencing population decline. Japan, Venezuela (Shocker), Russia (Shocker), Ukraine (Also a shocker...), and now that I think of it, almost all of the rest are other former Soviet Block countries. Their populations are declining, because people are actively getting the hell out of them, and nobody wants to/is allowed to move into them.

Re: The housing market is starting to crack – Sellers are cutting prices

#136

Post by jjav »

pixl97 wrote: post #133
jjav wrote: post #130

Earlier quoted context omitted.

> The share of millenials and genzers who are financially fit to even purchase a home are going to be far less than the amount of people who are dying. I don't understand this sentence. The number of houses that get sold or transferred to living people is of course exactly the same as the number of houses vacated by people who died. It can't be anything else since houses don't evaporate when the owner dies.

Just because you die doesn't mean your house is paid off or you don't have some kind of reverse mortgage on it. Just the yearly taxes on my home would be a significant burden to many.

> Just because you die doesn't mean your house is paid off or you don't have some kind of reverse mortgage on it.

That doesn't change anything with respect to the existence of the house. Someone might take a loss (the heir or a bank) but no matter, the house continues to exist and someone else will end up owning it.

> Just the yearly taxes on my home would be a significant burden to many.

If nobody can afford it that just means the price (and thus tax) will drop until someone can.

Re: The housing market is starting to crack – Sellers are cutting prices

#137

Post by klipklop »

spaceflunky wrote: post #115
jeffreyrogers wrote: post #33

Unless the housing supply increases this will just be a temporary thing. As long as people are able to make their mortgage payments they typically won't sell their homes at a loss (even if their equity is negative). Some people will always be forced to sell due to life events and that's what will set current market comps. Since mortgage rates have recently spiked upwards people who need a mortgage to buy a home can a…

>Unless the housing supply increases this will just be a temporary thing. The housing supply will increase dramatically in the next decade, not by building but by attrition. More than 55% of all homes in America are owned by Silent Gens or Boomers[0]. That figure includes non-SFHs, of SFHs I've read they own >70% of (lost my source unfortunately). They are going to start dying of en masse within the next decade. That…

> Unless we import a shit load of migrants who can also afford expensive real estate, or we print money so that institutions can buy these properties, the prices are going to sink like crazy.

Likely the powers that be will print money to hand over to institutions to gobble up real estate who will then rent out the properties to the incoming mass migration wave into the US. Most of these new arrivals have a almost zero percent chance of becoming home owners with the current pricing and wage suppression going on.

It seems to me various real estate investment groups have essentially unlimited lines of credit to buy up properties. On the commercial side they seemingly can ride out many of their units being empty for YEARS.

Re: The housing market is starting to crack – Sellers are cutting prices

#138

Post by nradov »

fragmede wrote: post #127
nradov wrote: post #124

Earlier quoted context omitted.

Within the USA we could reduce demand by reducing immigration. I don't think we should attempt to resolve the housing shortage that way, and I agree that we should build more housing, but let's at least be clear about the available options.

I think that enforcing internal borders, to prevent internal immigration, like people from Ohio trying to move to California or New York, or letting anyone in or out of Texas, is going to face a very strong uphill battle. But yes, let's be clear that is an option.

Obviously I was referring to external immigration from foreign countries.

Re: The housing market is starting to crack – Sellers are cutting prices

#139

Post by carlosjobim »

vkou wrote: post #135
carlosjobim wrote: post #92

Earlier quoted context omitted.

Most of the planet has below-replacement birth rates currently in a rapidly declining trend. These declining birth rates are not only leading to rapidly declining population, but to exponentially declining population. Right now, most homes that should be for families are inhabited by one or two elderly persons, while almost all real estate worldwide is owned by the elderly or abstractions they control, such as funds…

> Most of the planet has below-replacement birth rates currently in a rapidly declining trend. No, most of the planet has above-replacement birth rates . The developed world has below-replacement birth rates. People migrate from the former to the latter, resulting in net population growth in ~nearly country in the world. There are only a handful of countries experiencing population decline. Japan, Venezuela (Shocker)…

Have you actually looked at the data or are you just repeating things that were true in the last century? Here is the data:

https://data.worldbank.org/indicator/SP.DYN.TFRT.IN

Re: The housing market is starting to crack – Sellers are cutting prices

#140

Post by HDThoreaun »

quickthrowman wrote: post #43
wolverine876 wrote: post #37

Earlier quoted context omitted.

Unless the Fed cuts rates, how can mortgage rates plunge? Is CNBC doing it's old (and maybe continuing) cheerleading?

Mortgage rates mostly track the 10y yield, not the federal funds rate. As I understand it, avg US mortgage duration is 9-10y which is why mortgage rates track the US10Y yield. The Fed doesn’t directly control the 10y yield like they do the federal funds rate

The fed absolutely has control over treasury yields. They're by far the biggest buyer of all the treasuries through their open market operations. By buying more or less they can change the price.
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