When's the "collapse of residential housing prices" supposed to hit?
I keep seeing a bunch of talk about the glut of residential seller supply in TX/FL markets (~30% of listings nationwide). Trying to figure out when a good time to actually buy will be. Do the RE monkeys see an actual price decline coming due to the oversupply or is the activity still strong?
It already has. When you adjust prices for inflation, housing prices are down significantly. You just didn't notice because your salary is the same.
Shit fair point rip
Did you bother to do 1 second of research on this, or (as I suspect) are you just another entitled, selfish POS who decided to waste everyone else's time with an easily answerable question?
All it took was googling "Texas housing price trends" to find something on Redfin which shows that even in nominal terms, housing prices in Texas are down about 6% since April 2022. And while I don't know what the local numbers are, national inflation has been in aggregate roughly 10-12% since then, so in real terms housing prices have dropped 15-20%, which is indeed a massive dip.
whew lad
rawr
Bro is pissed OFF.
You and ozymandia have interthread beef
Alrighty I guess someone pissed in your cereal this morning. Yeah I'm a selfish POS I guess? Problem?
Why would I do the work when I could otherwise be working myself, when I can just ask the question here and get an answer from someone who both has the time (otherwise they wouldn't be answering) and who it's assumable knows magnitudes more about this subject than I do? Is that not the point of these forums? To ask more knowledgeable people questions about their sphere of expertise?
I mean, yes. We should all have a problem with selfish asshats.
But the time spent asking the question, could have been spent finding the answer. This is such a cowardly way out, and the sheer illogic of it is all the evidence we need that no, you didn't think this, you just thoughtlessly outsourced your work to people whose time you consider to be less valuable than yours.
Right, but if you showed up to a Terence Tao lecture and he had limited time for questions and you asked him a question that could easily just be Googled, you'd be considered the same kind of asshole.
You asked a question you could have just as easily found out for yourself, in pursuit of the prototypical unanswerable question ("when is a good time to buy?"). This doesn't spur require intelligence or expertise to answer, it doesn't spur interesting conversation, it won't bring in some informed opinion. It just requires literally 8 seconds on a search engine.
You thoughtlessly and selfishly wasted the time of everyone who came into contact with this post. Don't act aggrieved that someone called you out on it, just take the actually meaningful advice, to think for yourself before asking others, and move on.
Why u angry all the time dawg. Hope you’re ok, truly. I don’t disagree. Person asking the question sound like uninformed internet lurker not even remotely in CRE fishing for an answer.
Dude's angrier than Peter Dinklage's character from Elf. You are correct, I am uninformed when it comes to all things RE and do not work in CRE or anything remotely related to it. Congratulations, you solved the mystery.
"When's the "collapse of residential housing prices" supposed to hit?"
Never
Yeah that's kinda the impression I've been getting and am leaning towards just saying fuck it and buying ha
Mortgage rates have roughly doubled since 2020 and prices nationally have increased pretty significantly too, all while median wages have not kept pace. For the average American, buying a house pre-Covid is looking like possibly the best financial decision of their lifetime right now.
I really think you get to a point where normal people just can’t afford to buy homes and any kind of meaningful recession causes mass delinquencies on a budget that is already stretched to the max. However, unlike the housing crisis the supply issues are real and I don’t see a total market crash. I think you have enough renters waiting on the sidelines, who will immediately jump on any kind of meaningful correction.
That being said… who the hell really knows? I just think it’s not sustainable when I have friends making ~$150-200k per year who can’t afford a house. How is a person making median income supposed to afford anything?
No doubt the biggest personal finance regret in my life is not buying when I had the chance in early 2021 before the rate hikes started hitting. All great points, thank you. You're the very best, like no one ever was sir.
To your last point, don't you imagine so form of massive public backlash / display will inevitably occur? They wonder why the birth rate is decreasing but people can't buy houses.
Also, don't you assume boomers will start dying off in large quantities in the next 10 years which should open a lot of opportunities?
Another interesting angle here is how immigration plays out under Trump and future administrations. Immigration is what is fueling population growth in the U.S. and if there are mass deportations, that should free up some inventory. But the other side of that argument is that a lot of blue collar trades are highly dependent on immigrants for labor, so I think you see a massive spike in construction costs if mass deportations were to actually happen.
EDIT: Upon doing a quick Google search, an estimated 3.4 million undocumented workers are homeowners. The U.S. is estimated to have a shortage of ~4-7 million homes. Mass deportations would do a lot to free up inventory in the short run but you’re going to see skyrocketing construction costs in the long run.
As someone in the trenches (development, finance and also public policy) in residential real estate, I can tell you 3.4 undocumented workers (read again what you wrote, you said "workers") are not home owners lol In some markets, you have undocumented immigrants who are doing well for themselves, they have been in the US for 30+ years, they are not "workers" picking strawberries at a farm, they can own a modest home. This is an edge case. For the most part, they are renters and often living in multigenerational living arrangements. And if they own a modest home, that home is not in a safe suburb where most white collar professionals on this site would want to live in anyway. So, in no way shape or form, mass deportations is going to lead to freeing up inventory in any meaningful way. I am saying this with 100% certainty, it's not even 99.9% certainty. Additionally, when a white collar professional on this site is buying a 3 bedroom home with a white picket fence in a safe surburb, that home will likely receive multiple other offers. Do you really think an undocumented "worker" (again, those are your words) is going to be one of the potential home buyers in this scenario?. Your competition on the demand side is your co-worker sitting in the cubicle next to you, not the undocumented worker at Taco Bell. So, I really dont see the impact on the supply or demand side. The potential impact on construction costs is real though.
Never unless we have another GFC or recession. The problem is, housing prices got hit by both inflation and not just a supply/demand issue. People aren’t moving unless you absolutely have to as many hit the housing lottery by buying right before or at the beginning of COVID getting insane pricing as well as interest rates which are never going to be that low. Couple that with those who refi’d with sub 3%.
If you just go to random houses on Redfin in Dallas, Austin, and Houston it's not that hard to find homes that have marked down 10-20%. They were obviously listed at too high of a price but those were almost impossible to find just a year ago. Austin especially.
Texas markets (especially Austin) have seen big decreases in price. However, with increases in property taxes, insurance costs, and higher rates, the payment is still significantly higher than years ago. Additionally, the rents in those markets are so soft that the equation for owning a home is still so far out of the equation of making sense unless you believe those markets are going to see hyper growth of housing prices or rents again which they did during COVID. Thing is, those markets typically don't see that type of growth given the amount of land and development that happen in them. COVID was an all stars aligning thing that drove it to happen once along with 2% mortgages.
Something probably has to give. Could be rates coming down, prices coming down further, or rents going up. My guess is it'll probably be a combo of a little of all 3. Also starting to see foreclosures in those markets for the first time in a while.
I'm not close to Florida markets but I'm guessing the same is true there. Maybe prices have come down, but they're getting hammered so bad by insurance premiums alone that you're worse off than you were a couple years ago at the peak (now factor in rates as well).
As others have said, I still have trouble believing this housing market can continue as it's so unaffordable to most people. That said, if there's no real catalyst to building more or a major recession, then it will probably never happen. We've gotten used to middle class being able to live in spacious and safe homes that they can affordably own, but reality is that most parts of the world don't enjoy the same so we wouldn't be the first to suffer from it. Even countries with cheap housing usually have smaller homes built with paper walls and wouldn't pass the first minute of an inspection test here in the states.
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