It is atrocious that the law allows using shelter as an investment. Only for the initial sale of the property should it be permitted to make profit. After that, properties should only be sold at cost between buyers.
Why?
Home Prices Are Now Higher Than the Peak of the 2000s Housing Bubble
61–70 of 286 posts
Re: Home Prices Are Now Higher Than the Peak of the 2000s Housing Bubble
#62Awesome. I've been trying to buy a home since 2015 or so and noting that housing prices continue to rise, without fail, regardless of economic or political climate. Economy is doing well? Price increase! Economy is doing terribly because of global pandemic? Price increase! I have been patiently waiting for the next "bubble" to pop, even as my realtor insists that oh no, we're not really in a bubble, this is just the…
Even if it is a bubble, the market can stay irrational longer than you can hold out/believe. (Disclaimer I do have a vested interest in the housing market, but even if I didn’t I really believe it’s not possible for the average layman to know which way a market will go and when).
Re: Home Prices Are Now Higher Than the Peak of the 2000s Housing Bubble
#63Another trend to keep an eye on is “build-to-rent” [0]. Wall Street is hunting for returns. Real estate rental returns at scale are a viable target in an environment of near zero rates, especially at the lower-mid suburban price points.
Re: Home Prices Are Now Higher Than the Peak of the 2000s Housing Bubble
#64They cite the numbers in "real terms", which would mean inflation adjusted: > The average price of American homes, in real terms, is now the highest it's ever been Of course, you really need to be looking at mortgage rates to understand housing affordability: http://www.freddiemac.com/pmms/pmms30.html July 2021 average 30-year mortgage rate: 2.87% (with 0.7 points) 2008 12-month average 30-year mortgage rate: 6.03% (…
I think the article is referring to 2007/2008 as peak of the 2000s housing bubble. Not 2000’s housing bubble.
They were still about 6.8% in 2007.
Compared to a 3% interest rate today, on a $300,000 loan that's about $700/month difference in payment, about 50% increase.
Housing prices have not increased by 50%. At these rates, they often still cheaper.
Re: Home Prices Are Now Higher Than the Peak of the 2000s Housing Bubble
#65Lots of people miss the fact that the Fed has intervened in unprecedented ways in the past year, that we may not understand fully for decades.
Re: Home Prices Are Now Higher Than the Peak of the 2000s Housing Bubble
#66I keep hearing about a housing shortage. How we are not building fast enough. I personally know several people that own more than one home and AirBnB it when not in use. Also hedge funds are now targeting real estate. I can't help but wonder if this is partially an AirBnB and hedge fund created situation. Of course these are the same people that have access to all this free money. The average Joe still has to pay int…
Interest rates are historically low. I'd imagine hedge funds are paying interest too. You'd never want to tie up all that capital to avoid a 2% interest rate. Even I, an average Joe, pay the minimum payment on my mortgage and invest the rest. It would be foolish to pay it off early.
Yes they are maybe %1 - I was able to get %2 at 15 years. And hedge funds get money from investors then leverage that with loans that brings their total cost of capital down even lower. Our previous Secretary of the Treasury (Mnuchin) made his fortune that way after 2008.
Re: Home Prices Are Now Higher Than the Peak of the 2000s Housing Bubble
#67Earlier quoted context omitted.
Almost everything. Important exceptions are housing, health care and education, which have large impacts on COL. But most else is cheaper.
So basically all the important stuff, but hey, at least you can get a 50 inch flatscreen for 100 bucks on Black Friday.
https://www.yahoo.com/news/blogs/lookout/fed-official-heckle... (March 2011: Fed official heckled: ‘I can’t eat an iPad’)
Re: Home Prices Are Now Higher Than the Peak of the 2000s Housing Bubble
#68Re: Home Prices Are Now Higher Than the Peak of the 2000s Housing Bubble
#69They cite the numbers in "real terms", which would mean inflation adjusted: > The average price of American homes, in real terms, is now the highest it's ever been Of course, you really need to be looking at mortgage rates to understand housing affordability: http://www.freddiemac.com/pmms/pmms30.html July 2021 average 30-year mortgage rate: 2.87% (with 0.7 points) 2008 12-month average 30-year mortgage rate: 6.03% (…
No, I disagree. Law of big numbers.
Houses in Seattle area are mortgaging for 1.2M. Property taxes are low.
Houses in NY are mortgaging for $500,000. Property taxes and interest rates are higher.
You shouldn't apply 8% interest rate from 2000 and think that it somehow is the correct rate when prices are 5x higher.
Re: Home Prices Are Now Higher Than the Peak of the 2000s Housing Bubble
#70It is atrocious that the law allows using shelter as an investment. Only for the initial sale of the property should it be permitted to make profit. After that, properties should only be sold at cost between buyers.
Do you think the same about selling food for profit? or clothing? or medical care?