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https://www.nytimes.com/2021/02/26/upshot/where-have-all-the-houses-gone.html Any quick takes here? Inventory seems to be at a fairly dramatic low -- although I want to shy away from timing the market, I am also wary of buying at a high point in the cycle, and having to deal with years of depressed prices as future inventory returns to high levels.
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Feb 26, 2021 18:32
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If you have no timing restrictions, buying a house oct-super bowl Sunday in February is going to be the slowest time of the year. Don't be buying a house may-september if you can help it, although that's usually when the very best properties go on sale Millennials are finally at the point where they have to buy a house to support their growing families, and baby boomers refuse to die so unless we build 10% more housing overnight, or people stop getting pregnant, it's unlikely the market will completely cool down, at least in the lower-middle markets
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Feb 26, 2021 18:58
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Hadlock posted:If you have no timing restrictions, buying a house oct-super bowl Sunday in February is going to be the slowest time of the year. Don't be buying a house may-september if you can help it, although that's usually when the very best properties go on sale =( I feel this, hard, as a Millennial. Inventory is brutal right now where I can afford, and we're solidly middle-upper middle class. We've been going since early December, and have only personally viewed like three places. There's only like one place a week that's popping up that's even worth having our agent ask about. And we're in NYC.
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Feb 26, 2021 19:02
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Plus investors are buying up about 25% of starter/entry level homes. Higher end is 5-10% but overall you've got a lot of people buying homes with no plan to live in 'em
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Feb 26, 2021 19:04
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GoGoGadgetChris posted:Plus investors are buying up about 25% of starter/entry level homes. Higher end is 5-10% but overall you've got a lot of people buying homes with no plan to live in 'em  We've been looking at townhomes in the valley, I think since I
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Feb 26, 2021 19:11
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A MIRACLE posted:
I'm not making any judgment, just saying that demand is outpacing supply and it's not because Millennials or Boomers are Doing Thing
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Feb 26, 2021 19:12
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Mackieman posted:Actual cost isn't that big of a deal because, as you noted, rates are at historic lows despite the in the last week or so. Find that happy medium between points and monthly cost. Yeah, note that rates were hovering around 3.5-4.5 for most of the last decade, and the decade before that they were in the ~5-8% ballpark. Kick things back to the 90s and you can find rates flirting with 10%, and go back to the early 80s and it just gets nuts. I know my dad's first mortgage was for something like 17% in 1981. Pretty much anything under 4 is cheap and anything anywhere near 3 is loving cheap, historically. The sub-2.5 that we just saw is ludicrous. edit: also if you want another factor in the ever rising cost of housing in general, this solid decade+ of low to super low rates is part of it as well. Low rates means you can get more with lower monthly payments, which in turn means that people's budgets increase. Maybe they shouldn't, maybe you shouldn't be carrying 5x your annual income in housing debt, but much like cars a lot of people just look at the monthly payment and call it good.
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Feb 26, 2021 19:24
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As far as housing goes, pretty much the only thing left to do at this point is simply build more housing. Corporations buying property and shady Airbnb renters are one thing but still minor compared to the amount of first time home buyers. If we don't build then homeownership will only be for the rich or whomever was lucky enough to be born in better economic conditions.
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Feb 26, 2021 19:30
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~17 million vacant, habitable homes in the USA as of 2019. It's not a supply problem unfortunately
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Feb 26, 2021 19:43
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GoGoGadgetChris posted:~17 million vacant, habitable homes in the USA as of 2019. It's not a supply problem unfortunately I'm thinking that's going to be market dependent. I don't have any data and I'm too lazy to look it up, but i suspect that vacant housing stocks are going to be different in SF/Boston/NoVa/etc than in Tulsa.
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Feb 26, 2021 19:49
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GoGoGadgetChris posted:~17 million vacant, habitable homes in the USA as of 2019. It's not a supply problem unfortunately That's actually a good point A bunch of homes from the 2008 collapse, like, double digit percentage, I forget exactly, the banks foreclosed on, and just have been sitting on for 11+ years now rather than dump them on the market all at once and crater the market. It's so crazy my brain just refuses to comprehend that. It's cheaper to take the losses on those homes rather than set the market back fifteen years. Or they never foreclosed on, the occupants just stopped paying the bank and they're 5+ years behind on payments. It's nuts. This is real I'm not making it up
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Feb 26, 2021 19:59
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GoGoGadgetChris posted:Plus investors are buying up about 25% of starter/entry level homes. Higher end is 5-10% but overall you've got a lot of people buying homes with no plan to live in 'em Does this include flippers? Feels like everyone I know who has bought/is buying is trying to beat flippers to the punch/avoid lovely flips in my neck of the woods and it certainly feels higher than 25% for some subsets of houses (based on anecdote, gossip, and extremely small sample size - no clue what the actual figure is around here). Especially the moderate to easy fixer uppers (flippers can keep the ones with holes in the roof that are missing all their copper - gently caress dealing with those houses). I guess a potential upside to flippers over shady private equity firms is that houses that flippers buy generally return to the market to hopefully be bought by owner-occupiers, though at the cost of paying a premium for typically shoddy work and greige walls, rather than effectively permanently removed from circulation by being made into crappy overpriced rentals for the rest of time.
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Feb 26, 2021 19:59
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Cyrano4747 posted:Yeah, note that rates were hovering around 3.5-4.5 for most of the last decade, and the decade before that they were in the ~5-8% ballpark. Kick things back to the 90s and you can find rates flirting with 10%, and go back to the early 80s and it just gets nuts. I know my dad's first mortgage was for something like 17% in 1981. Am I getting this right, that the PITI on a $750k with a: - 3% mortgage is approx. $3,500, - 5% mortgage is approx $4,190, - 8% mortgage is approx $5,372, - 10% mortage is approx $6,234! Am I understanding correctly that people that are people hoping to make money on their houses will be hosed if rates rise? Are housing prices inversely correlated to mortgage rates?
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Feb 26, 2021 20:57
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laxbro posted:Am I getting this right, that the PITI on a $750k with a: Looks like the correlation is not strong: https://www.bankrate.com/finance/mortgages/rising-rates-lower-house-prices.aspx
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Feb 26, 2021 21:05
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laxbro posted:Am I getting this right, that the PITI on a $750k with a: That's the huuuuuge question mark. If I knew the answer to that I'd be speculating in real estate not shitposting on the internet. My understanding is that, yes, in a theoretically perfect economy increasing interest rates should depress housing prices. Monthly payment goes up, this constrains the number of people who can afford the loan on the same $750k house, which in turn lowers the cost because supply for previously-$750k-houses outstrips demand. The big question, though, is how strong that relationship is. There are a ton of other factors - demand, location, etc. There's also the issue of what happens to all the loans that are now underwater. You borrowed $750k at 3% but now the rates are at 6% and let's say the neighbors house now sells for $600k. The bank still wants their money. Not a problem if you're planning on living there for 30 years. Maybe you're a bit salty about over-paying, but you also got the money cheaply. But if you still owe $700k on the mortgage and can only sell it for $600k that's going to severely cramp your ability to move elsewhere, say if you get a better job offer.
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Feb 26, 2021 21:09
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Yes, there’s evidence that rising rates puts downward pressure on prices and vice-versa. Which makes sense - people have $X to spend on housing regardless of what the mix is of principal, interest, and taxes but the general trajectory of housing prices is up. “Downward pressure” just means rising less quickly. Same with downturns in the economy - with the conspicuous exception of 2008-2009, housing prices in aggregate tend to level out in a recession but pretty much never actually go down
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Feb 26, 2021 21:10
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I’ve seen so many clearly lovely flips pop up. They all have the the exact same bathroom tile accents. Then again the industry has made it such a nightmare for anyone to renovate a home that’s in bad condition. You basically need to have the cash to both cover rent and your mortgage for a whole year if you’re doing a home Reno loan. It’s crap. I’d much prefer to buy a cheap hosed up house and do a shitload of renovation to it, but I could never afford both payments.
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Feb 26, 2021 21:12
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In the DC metro area, lovely flippers, and I mean really lovely flippers, have so many units for sale they actually started their own realtor agencies. There’s one or two notable ones that do poo poo like replace wooden window mantles with a cheap strip of one inch thick plastic etc.
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Feb 26, 2021 21:16
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Squinky v2.0 posted:
Depends a lot on the location and whether the community and economy there is growing or is in decline. Plenty of cities that got big off the back of industrialization and shipping in the late 19th/early 20th century are tearing down housing right now because it's abandoned (Detroit and Baltimore to name two prominent examples). IIRC you can buy row homes in some of the more severely hosed parts of Baltimore or low five figures. You also see it with some of the oil boom towns. There were random small towns that overnight saw huge infusions of cash and well paid workers, housing prices (either rent or buy) went loving batshit, and then when the oil companies moved on poo poo bottomed out hard again. If you spent $500k on a house in a boom town you aren't getting that money back. Also declining parts of the rural US. I taught at a rural southern community college for a couple of years and house prices there weren't exactly on an upward trajectory. Similar issue as you see in those de-populating cities, you saw more than a few houses just going empty after the old folks living in them died.
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Feb 26, 2021 21:19
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in San Diego county, I've been regularly checking a real estate blog, https://www.piggington.com. To put the current socal housing situation in perspective, here's a fun chart:  quote:The "valuation index" shown below compares San Diego home prices to San Diego rents and per capita income. As of the beginning of 2020, valuations had gone nowhere for 4 years. Then the pandemic hit, and valuations popped 10% in a year. San Diego home prices (as compared to rents and incomes) are easily the highest they've been outside the bubble. So, sure. Once the pandemic calms down, and interest rates go up, the value will drop. But if you notice, the bottom of each correction is higher than the last. I'm sure the real estate market is due for a correction any day now. However, I'm not sure what's going to be the straw that breaks the camels back. Moreover, I'm not sure how much of an impact an impending correction will have on the housing prices down the line. The issue is, there's just not enough development occurring here for the demand because there's just not much land to develop that's desirable. San Diego is basically one massive, glorified suburb. There's poor public transportation and the business districts are not prioritized by highways well. Queen Victorian posted:I guess a potential upside to flippers over shady private equity firms is that houses that flippers buy generally return to the market to hopefully be bought by owner-occupiers, though at the cost of paying a premium for typically shoddy work and greige walls, rather than effectively permanently removed from circulation by being made into crappy overpriced rentals for the rest of time. I've been convinced for years now that there's only one flipping company in my current neighborhood, because every single house we viewed which was flipped had the exact same materials and colors. It was honestly really discouraging how quickly the 'cheap' houses would be bought, 50grand invested into it, and then re-listed for 100k more.
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Feb 26, 2021 21:23
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Cyrano4747 posted:Depends a lot on the location and whether the community and economy there is growing or is in decline. Plenty of cities that got big off the back of industrialization and shipping in the late 19th/early 20th century are tearing down housing right now because it's abandoned (Detroit and Baltimore to name two prominent examples). IIRC you can buy row homes in some of the more severely hosed parts of Baltimore or low five figures. Yeah, I should emphasize that any statement like that only works on a very macro scale Your town, neighborhood, or even just your specific house could for sure end up underwater. And that’s more meaningful to an individual buyer than what the entire housing stock of the US is doing But when we’re talking about the effects of interest rates on housing prices, we’re talking very big picture. If your house declines in value it’s more likely about what’s happening in town than the prime interest rates
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Feb 26, 2021 21:35
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GoGoGadgetChris posted:~17 million vacant, habitable homes in the USA as of 2019. It's not a supply problem unfortunately This is a problem of geographic distribution. An empty house in the rust belt isn’t somehow increasing home prices in LA.
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Feb 26, 2021 21:57
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Crosby B. Alfred posted:As far as housing goes, pretty much the only thing left to do at this point is simply build more housing. In addition to the comments about land availability in desirable areas (i.e. there are plenty of houses/land where people don't want to live), building housing, especially inexpensive housing, is drat near impossible with the sky high cost of materials, shortage of labor, and onerous government regulations. Recent estimates put the cost of those government regulations at 25% of the cost of the house. Add in some profit for the builder, and there's just no way to build any SFH in a populous area for <$350K or so, even given all the cost cutting the mega builders do.
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Feb 26, 2021 22:09
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B-Nasty posted:In addition to the comments about land availability in desirable areas (i.e. there are plenty of houses/land where people don't want to live), building housing, especially inexpensive housing, is drat near impossible with the sky high cost of materials, shortage of labor, and onerous government regulations. Recent estimates put the cost of those government regulations at 25% of the cost of the house. Add in some profit for the builder, and there's just no way to build any SFH in a populous area for <$350K or so, even given all the cost cutting the mega builders do. The answer isn't to build more SFHs. The answer is to build high density housing.
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Feb 26, 2021 22:12
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Well, what I mean is, "build more houses" isn't the solution. There are houses everywhere! There is only shortage of extremely specific physical, geographical, and economical units that represent the tiniest sliver of available supply but are what the vast majority of buyers want. And since builders are profit-seeking entities, they have the opposite priority as the buyers. Buyers want 3 BD/2 BA homes at 1,600 SF on a 10,000 SF lot about 25 minutes outside of Local Big City, and they want Great-Not-Excellent finishes and amenities How do you reconcile that with builders who can realize the biggest profit with a 4 BD/3.5 BA house on nice cheap land an hour from the city with a 5,000 SF lot and OK-But-Not-Good finishes? (Federal-level intervention - which is very much impossible)
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Feb 26, 2021 22:12
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People tend to think of "builders" as like... a naturally occurring resource that you can harness and use to build what is most needed by the community. Unfortunately, builders are just Dudes With Way Too Much Money Who Want Even More Money, and so they don't give a crap about what an area needs. They follow profit wherever it goes, and build the type of units in the specific places that have the highest Sale Price - Cost to Build = Their Profit. There's no money to be made in Eastern bloc-style construction and so they don't do it. City-level government will try and put some little taxes and incentives out there to encourage builders to stray from McLuxury Product, but builders don't even care what STATE they build in so they just head on down to a more profit-friendly metro and throw down some more high priced trash on their latest superfund site/opportunity zone
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Feb 26, 2021 22:24
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GoGoGadgetChris posted:People tend to think of "builders" as like... a naturally occurring resource that you can harness and use to build what is most needed by the community. Unfortunately, builders are just Dudes With Way Too Much Money Who Want Even More Money, and so they don't give a crap about what an area needs. They follow profit wherever it goes, and build the type of units in the specific places that have the highest Sale Price - Cost to Build = Their Profit. There's no money to be made in Eastern bloc-style construction and so they don't do it. I feel like a solution is to pay a team of builders like 80-100k (or significantly above market rate) a year from THE GOVERNMENT to build homes that people want. Make the cost of the home materials + labor + like 5% and require the buyer live there like 10 years, and structure it by lottery/income. In NYC we have a program where middle income people can apply for luxury apartments in fancy high rise buildings. Basically $1mm condos that sell for like $400k, and the high rise building gets a bunch of tax breaks. It's incredibly popular, is based on lottery/income (plus a few other things), and the wait list is ENORMOUS cause it's such a good program. Issue here is there can only be so many of those, and the cost for the condos is STILL too high for lower middle class people.
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Feb 26, 2021 22:31
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GoGoGadgetChris posted:People tend to think of "builders" as like... a naturally occurring resource that you can harness and use to build what is most needed by the community. Unfortunately, builders are just Dudes With Way Too Much Money Who Want Even More Money, and so they don't give a crap about what an area needs. They follow profit wherever it goes, and build the type of units in the specific places that have the highest Sale Price - Cost to Build = Their Profit. There's no money to be made in Eastern bloc-style construction and so they don't do it. Well sure, but cities can get out of the way so it doesn’t take 5 years to get approvals for an apartment building. Let developers build 2+5 and 1+5 buildings of wood and parking podium everywhere and you won’t solve everything, but you’ll help a lot of people.
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Feb 26, 2021 22:48
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GoGoGadgetChris posted:There's no money to be made in Eastern bloc-style construction and so they don't do it. Not to mention that, unsurprisingly, those that advocate for higher density housing also don't want to live near it. NIMBYism is the strongest where property values are high. Despite talking a good game about the need for 'affordable housing', nobody sane is going to vote to negatively impact the value of the most expensive asset they own.
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Feb 26, 2021 23:24
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I just want there to be lots of affordable high-density projects so that nobody else will compete for the single-family homes I want to buy (plus lots of public transit so my bimmer won't get caught in traffic)
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Feb 26, 2021 23:37
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gently caress! Had a separate electrical inspection done at the suggestion of the inspector and although the original issue checked out OK the electrician points out that the house has an old Stab-Lok panel that will need to be fixed before we can get insurance. Probably not a big deal one way or the other but for a second it looked like things were smooth sailing ahead 
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Feb 27, 2021 00:58
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Just be glad the house is not built upon load bearing firewood like the one I just walked away from. Just terminated my contract
biceps crimes fucked around with this message at 01:03 on Feb 27, 2021 |
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Feb 27, 2021 01:00
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Pilfered Pallbearers posted:
These types of systems do not help the situation though, because the builder/manager of these buildings is still getting the equivalent of their huge rent, it just encourages more builders to build more 1mm+ homes. It's like the various programs that help lower income people get bigger loans for houses, all it does is encourage builders to make more overpriced houses to fulfill the needs of people that now have access to more money. The only solution is for a not profit-driven entity to build housing that's intended to be cost and space efficient. Of course this hypothetical publicly funded building organization would still have to deal with mega-NIMBY bullshit because it would drive the cost of all housing down.
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Feb 27, 2021 01:38
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Bucnasti posted:These types of systems do not help the situation though, because the builder/manager of these buildings is still getting the equivalent of their huge rent, it just encourages more builders to build more 1mm+ homes. Yeah I agree, I’m just using it as an example that the demand for housing using that style of system is there and people are generally happy with it.
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Feb 27, 2021 02:02
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Wife and I just went under contract for what will hopefully be out first purchased home together  I have the inspection scheduled for early next week, what's one thing you wish you had asked when getting your current/former house inspected?
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Feb 27, 2021 02:23
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C-Euro posted:Wife and I just went under contract for what will hopefully be out first purchased home together Is the entire neighborhood actually located on top of a river?
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Feb 27, 2021 03:15
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B-Nasty posted:Not to mention that, unsurprisingly, those that advocate for higher density housing also don't want to live near it. NIMBYism is the strongest where property values are high. Despite talking a good game about the need for 'affordable housing', nobody sane is going to vote to negatively impact the value of the most expensive asset they own. I would love to live in the middle of super high density housing, like central Tokyo. It is absolutely a different way of life but I really, really enjoy it. Americans have this sort of obsession with owning a single-family home and it is just the dumbest thing.
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Feb 27, 2021 05:16
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totalnewbie posted:I would love to live in the middle of super high density housing, like central Tokyo. It is absolutely a different way of life but I really, really enjoy it. As someone who’s lived it the passed 10 years, it’s kinda a drag because it’s America. People are nosy as gently caress. And they can’t keep their weird rear end comments to themselves. Asking me how late my child was up last night isn’t the thing I want to hear from my neighbor I speak to once every two weeks in pleasantries. I’m also not a huge fan of tiptoeing around my own home to try and not disturb the people below me.
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Feb 27, 2021 05:40
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totalnewbie posted:I would love to live in the middle of super high density housing, like central Tokyo. It is absolutely a different way of life but I really, really enjoy it. not sharing walls/floor/ceiling with a neighbor is great. You don't have to deal with them being loud and you can be much louder yourself. I've had some absolutely awful neighbors in shared buildings over the years.
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Feb 27, 2021 05:46
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I should clarify that it's not that I don't see any advantages to single-family homes - as you guys mentioned, they certainly exist. But some of those problems just come lovely construction, people not being used to living in those situations, etc. I honestly think part of it is that people are so ingrained with the idea of having single-family housing and its benefits that they expect, and act like, that situation no matter where they actually live. I think there's also a lot of zoning differences in the US and my experiences overseas (not just Japan) that make high density residential in the US seem really stupid/dull - and I'm sure a lot of other factors - but I think it can be done well and I wish it would be more accepted in the US. Suburbia is the loving worst.
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Feb 27, 2021 05:58
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