c&p'd since paywall. Honestly, if I had the free time to do so (and you could remove my hatred of moving), I'd list my place this weekend and go rent for 12 months, likely coming back into a buyer's market for my next house.
High prices and rising mortgage rates dragged down April's total. The monthly drop was the biggest in almost a decade.
S?ales of new single-family homes fell sharply fell in April for the fourth straight month, dragged down by high prices and rising mortgage rates. And the drop has a top real estate economist sounding the alarm about the country’s economic health. New residential sales last month declined 16.6% from March’s 709,000, to a seasonally adjusted annual rate of 591,000, government numbers out Tuesday show. Consensus estimates expected a 1.7% decline, to 761,000. The month-over-month slide was the biggest since 2013 and the rate of sales was the lowest in two years, according to data. Robert Dietz, the chief economist for the National Association of Home Builders called the plunge “a clear recession warning for the overall economy for the quarters ahead.” It’s also the latest sign that the residential real estate market is slowing down: Rising mortgage rates and home prices have put pressure on home affordability. “All in, a significant number of prospective home buyers are being priced out of the market,” Dietz wrote in a blog post Tuesday. Existing-home sale numbers out last week from the National Association of Realtors showed a decline, and the trade group’s chief economist, Lawrence Yun, said he expects further drops. “Higher home prices and sharply higher mortgage rates have reduced buyer activity,” Yun said in a statement. Last month, the median sales price of a new home in April was $450,600, a19.6% increase from a year ago. And the average weekly rate on a 30-year fixed mortgage reached 5% for the first time since 2011, according to Freddie Mac, a government-sponsored mortgage company. As of last week, the average rate was 5.25%, more than 2 percentage points higher than its final reading in 2021. On Wall Street, builder stocks were trading lower. D.R. Horton (ticker: DHI), Lennar (LEN), NVR (NVR), and PulteGroup (PHM), the four largest public builders by market capitalization, were down between 2.5% and 3.8%.
“When my information changes, I alter my conclusions. What do you do, sir?”
John Maynard Keynes
“Anti-intellectualism has been a constant thread winding its way through our political and cultural life, nurtured by the false notion that democracy means that my ignorance is just as good as your knowledge.”
future buyers can't explicitly ask if Gypsies have ever been in the house before.
Have you considered selling it it to one of your children and their family when they marry one of my offspring and start a new life in Clover, or wherever TF the house is? You can seller finance the mortgage and have a nice semi-reliable stream of income. PLUS - if you and your wife have a nasty divorce, you can just show up on the front porch, suitcase in hand, and move back in!
it's been about prices skyrocketing. Transactions have been down since Covid to the extent that many realtors are leaving the industry, not as many new ones are entering, and the new ones that do are turning over faster than before.
I think rates combined with people having ENOUGH of the artificial price increases are causing transactions to drop.
I'm not sure the "transactions are down" statistic is correct....maybe on new construction, but not on existing homes, which is where the crazy appreciation is coming from. Realtors are leaving the industry because the "bidding war/competing with all-cash corporate buyer/you'd better know the pocket listings" is a new dynamic---some can adapt, some can't.
Appreciation does seem to be coming from a shortage of inventory (likely that new home shortage driving buyers to existing homes) combined with the bizarre new corporate investors entering the home market like we've never seen before.
She's been at it a long time and is a high performer and she had her largest year ever in 2021. She already did more through April 22 than all of 2021. She said much of what you said...the high performers are going lights out, but the part-times and low-end are struggling because they haven't adapted or can't adapt.
local market here. Admittedly most of my info is anecdotal based on some folks I am close to that are long time realtors, brokers, etc. I did find this little nugget below. Small sample of data but it's in line with what I'm hearing around here.
In April 2022, Greenville home prices were up 17.2% compared to last year, selling for a median price of $340K. On average, homes in Greenville sell after 38 days on the market compared to 53 days last year. There were 220 homes sold in April this year, down from 256 last year.
checked the rental availability and pricing before you sell.
Rentals rates are increasing as well. Unless you plan to live in south america in a jungle somewhere which may not be a bad idea. RHTig could provide some startup guidance on war lording in subtropical climates. His side of Cherry road is an entirely different environment as you know.
We sold our estate on the golf course last year but didn't actually have a place to go. Not sure we'd do that again.
Inflation and higher interest rates make lenders queazy about loaning to those on the high housing price bubble based on what I've been reading. But I believe in Bigfoot too. So there's that.
It was awesome when I lived on the island and could walk on the beach every day or walk to the windjammer, or just you know...live on an island...but renting in just a normal 'hood in a house that looks like something I had rented while I was in college..sucks.
Don’t believe there was anything in my post that was hysterical or emotional. I basically said these skyrocketing appreciation rates should be slowing and reversing, which seems like it should be the case.
It hasn't really slowed down much around here. And prices are still going up. There is just no inventory. Average time on market is 8 days, down from 10 days a year ago. All houses that go for sale...sell. For sale turnover rate is 100% in 30 days.
In 29464, a zip code that has 21,175 homes in it (according to the post office), as of right now there are 5 SFH (not condos, townhomes, but actuall houses. etc) for sale below $800,000. For prices above that, there are 46 more houses. There are 51 houses for sale out of 21,175.
Statistically, if all the current sellers sold their house for $1, could that even be considered a "crash"? Or just one weird anomaly? Houses for sale represent only .3% of the market.
purchases, hedge funds and the like. In some places 20-30% of homes are selling at inflated prices, above asking price, to hedge funds and investment firms. And I see why, because prices are skyrocketing. But it reeks of the stupidity of buying high. It's as if they see this playing out for a longer term. I've seen social media videos of supposed realtors who say this is the future of real estate. It can't be sustained. Are the hedge funds thinking they can rent the things for a profit in the future? Because if buyers (normal people) are tapped out at 6% mortgages with 8% inflation, then renters will be tapped out at a similar rental point as the mortgage payment. If you have an older property locked in at lower rates, then you can make more renting. But buying now, to rent, is equally as bad an idea as taking out the mortgage at these rates (given inflation).
Just don't get the investor involvement. Not sure how deep it goes, but if the investors are buying up these houses for a quick turnaround sale as soon as demand starts to wane, there will be a crash as they can't unload these properties fast enough. This is a similar setup as the housing crisis in 2008. In that example though, investors gobbled up MBS after seeing the market climb, leveraging that debt as collateral, even though that presumed asset became a debt liability for the biggest investors. It could end up being a situation where the home becomes a toxic debt on the part of a financial institution burned, rather than a borrower burned on a irresponsible loan.
but there are so many people saying the same thing you are..(I'm hoping for a crash so I can actually buy a house where I want to live) Even if there were a mass sell off event...I don't think it would affect the market like some to think it would.
I went to the bank yesterday to deposit a 10k check and the teller and I were talking about homes. He said he had sold his home in Seattle for 650k and then moved here and bought the same type home for 350k.
So there are gonna be these people moving from liberal areas to here and the home prices are 40% less. They think it’s a steal.