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Lumber crash leads to 'blowout' sales as prices crater

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Re: Lumber crash leads to 'blowout' sales as prices crater

#461

Post by da_chicken »

arthurcolle wrote: post #76
da_chicken wrote: post #48

Earlier quoted context omitted.

Because sometimes "skyrocketing" means going 1% over the average annual high, or "cratering" going 2% below widely published analyst forecasting. In other words, the media is often radically hyperbolic to get clicks and ad views. So much so that when they use the same adjectives correctly they don't carry any weight anymore. They're the boy who cried wolf.

Average annual high (I'm assuming you're using the stock price daily high from a multi-year set of highs from its daily OHLC bars as the 'high' here) is a poor metric to evaluate whether or not a company is doing well. Low beta stocks usually don't really outperform so I mean you need to just optimize for low correlation, high relative outperformance vs. a sector wide index or something. I just don't think the random…

The entire point was that the metrics I chose were bad. Furthermore they were such minor differences that even if they weren't bad they still wouldn't be relevant. They were intended to be comically useless.

It means that the hypothetical author of the article didn't have any idea what they're reporting, which is exactly what I was trying to express. The authors rely on the readers' ignorance and the way many people reflexively accept numeric data as true, pertinent, and sufficient evidence of any claim.

Re: Lumber crash leads to 'blowout' sales as prices crater

#462

Post by zdragnar »

snarf21 wrote: post #354
mgkimsal wrote: post #13

"If high prices held you back from building, you are in luck, as the tables have now turned" Except... many builders will find some other reason/excuse where prices are high to keep prices high. We were looking at building a house - talked to builder last November and... looking at $470-$480k range (ballpark estimate). Lumber was going higher, but we'd reduced the house plan size. Lumber kept going up... and up... Th…

This is the same thing happening with cars. There isn't enough new car inventory so used cars are going higher and higher. Dealers are buying used cars for MORE than people paid new. As already built houses for sale continues to rise, new construction and rents will rise too. The market is adjusting to make all choices equally bad.

I'm starting to see dealers sell at, and in some cases above, the cars MSRP. The value proposition of buying new is shaky enough during good years, I cannot imagine buying a new car above MSRP.

Re: Lumber crash leads to 'blowout' sales as prices crater

#463

Post by zdragnar »

tejohnso wrote: post #317
mgkimsal wrote: post #13

"If high prices held you back from building, you are in luck, as the tables have now turned" Except... many builders will find some other reason/excuse where prices are high to keep prices high. We were looking at building a house - talked to builder last November and... looking at $470-$480k range (ballpark estimate). Lumber was going higher, but we'd reduced the house plan size. Lumber kept going up... and up... Th…

> people will be clamoring for HELOCs as they won't be able to sell these $700k houses they're buying Why would you want a HELOC just because you can't sell your house for a profit?

Around 15 to 20 years, houses start to need expensive maintenance- new appliances, perhaps siding or roofing if you've had a rough run or it was poorly installed, etc.

If you are unable to sell the house and don't have a nice savings cushion, you need to look at a HELOC to pay for it.

Since sellers often pay real estate agent fees and some others, you need a pretty decent sale price above what you owe on the mortgage just to break even... And then money for moving costs and a down payment on wherever you go next.

Edit: it is also not uncommon to take out a HELOC to pay for sprucing up a house- flooring, new kitchen, etc- if you are struggling to attract any buyers at all. I've known people in smaller towns go into debt just to sell their house because they had to move for a job. They even tried renting it out for awhile since noone was buying, and the renters ended up trashing the place, so that made it even harder.

Re: Lumber crash leads to 'blowout' sales as prices crater

#464

Post by reverend_gonzo »

pie42000 wrote: post #453
dannyw wrote: post #243

Earlier quoted context omitted.

Unfortunately I suspect it'll never be cheaper to build.

You realize a massive market crash is coming soon? The quick sugar high from all the stinky $$$ will dry up soon, and then the market will crash. If that happens, expect it to be very cheap to buy a house and a used car when all the people who could barely afford their new car/house find themselves underwater, unemployed, and no longer receiving Covid stimulus checks. But who knows, maybe the economy will just keep b…

They’ve been saying there’s a pending crash for the last five years. I’ve expected it too.

The only thing that happens is soon as the market gets skittish, the fed prints money. They seem to be so scared of a recession, or maybe, the poets that be are so leveraged up themselves, that they will do whatever it takes to prevent a crash.

My thought is, don’t be so leveraged that you’re the first to collapse when things go down. If things continue collapsing, the fed will step in and fix everybody still standing.

Re: Lumber crash leads to 'blowout' sales as prices crater

#465

Post by milkytron »

otterCompile wrote: post #206
10GBps wrote: post #6

I don't think prices are "cratering" so much as just returning to normal rather than price gouging. Now if I could just buy a GPU for a normal price...

It's so insane. My 5-year old GTX 1060 (320€) is still better than a new gtx 1650 for 250€. Right now there is no direction to upgrade my system except for byuing an apu, but since my 1060 is way faster this doesn't make sence unless i want to get rid of my gpu to get a smaller case (e.g. X300)

I also have a GTX 1060 that I got in... 2017 I believe.

I looked up prices recently and it's worth more now than when I bought it, and the ones available that I've seen are used. Had no idea that would happen and now I'm just happy I have a graphics card at all.

Re: Lumber crash leads to 'blowout' sales as prices crater

#466

Post by shados »

nexuist wrote: post #439
shados wrote: post #410

Earlier quoted context omitted.

My friends and I always joke about quitting our software jobs to go work on a farm when things get rough. We're obviously just joking (things are never that bad). But you actually did it and living the meme. Kudos!

Wait, you guys are joking? Over in my corner everyone is completely serious about it. My girlfriend wants to buy our first cow in the next two years. I work fully remote so all I need to do is find some land.

I mean, I know one software engineer who has a farm and probably could do it if the time was right.

The rest of us would likely poison ourselves, break something, or starve if we tried.

Living things are pretty far from my area of expertise, and youtube videos only get you so far.

Re: Lumber crash leads to 'blowout' sales as prices crater

#468

Post by saalweachter »

abledon wrote: post #457
saalweachter wrote: post #356

Earlier quoted context omitted.

For TV viewing, try to watch the "fixing the stuff that went wrong" style TV/YouTube shows, where a builder is going around going, "Oh god, you can't do that that way, do that this way". Part of learning is learning from mistakes -- you learn which parts of the "correct" way to do something are essential, and you learn why the correct way is correct, when the incorrect way fails. Ideally, that's the part you want to…

whats your best youtube channel recommendations for "stuff went wrong" style construction learning

I don't have a good playlist or show to link off-hand, but here's a wonderful video about someone finding terrible things in their old house: https://www.youtube.com/watch?v=_v33Gb2xPhU

In general you want "fixing old houses" videos that focus more on the tear down and guts and less on the "look how pretty my house looks at the end" before & afters.

Re: Lumber crash leads to 'blowout' sales as prices crater

#469

Post by etskinner »

abledon wrote: post #457
saalweachter wrote: post #356

Earlier quoted context omitted.

For TV viewing, try to watch the "fixing the stuff that went wrong" style TV/YouTube shows, where a builder is going around going, "Oh god, you can't do that that way, do that this way". Part of learning is learning from mistakes -- you learn which parts of the "correct" way to do something are essential, and you learn why the correct way is correct, when the incorrect way fails. Ideally, that's the part you want to…

whats your best youtube channel recommendations for "stuff went wrong" style construction learning

Matt Risinger on youtube has some good ones. Most of his videos also have comparisons of construction methods, too. New vs. old, expensive vs. cheap. Other videos have some 'best practices'.

Here's one about corners some contractors often cut: 10 DUMB (and Common) Building Practices https://www.youtube.com/watch?v=LuUxUt6MwIU

Here's another about his regrets about how he remodeled his own house: https://www.youtube.com/watch?v=4HYROAFgp7Y

Re: Lumber crash leads to 'blowout' sales as prices crater

#470

Post by Zenst »

mgkimsal wrote: post #13

"If high prices held you back from building, you are in luck, as the tables have now turned" Except... many builders will find some other reason/excuse where prices are high to keep prices high. We were looking at building a house - talked to builder last November and... looking at $470-$480k range (ballpark estimate). Lumber was going higher, but we'd reduced the house plan size. Lumber kept going up... and up... Th…

Does it not start to become cheaper to rent some storage and buy the items when they are low, like timber now and then the other core bits, biding your time. Though storage costs a factor and equally equity to buy the materials over time at the right prices. But then those materials are assets and if you buy cheap, even if you don't go ahead - resell will break you even at least.

Much the same way air-con units and fans cost more in the summer compared to winter - prices do seasonally fluctuate and those can have a knock on effect. So cheap timber will drive up the other items with demand, so you can almost foresee once timber goes up, the ancillary items will come down due to demand again. That and winter, will curtail some demand and that may well be the time for buying some items.

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