Foreclosures are on the rise. Here’s what that says about the housing market

[BackwardsEngineeer]

Yep, hear it every day... cashed in in NY or CT or NJ or, or relocated to FL, it's too hot, now want to move half way back. They stroll down here to SC, admittedly podunk to them expecting 100 to 150 /sq ft homes.. listening to the comments and arrogance of folks riding in my car sometimes sickens me. Look the house is nice but you have to drive past a trailer to get there. Many Lifers here, can no longer afford our market. Military here, can no longer buy and be within their max rediness distance to the base. Everyone wants to be a RE agent, its the path to wealth and fame.... all you have to do is say pay more and you got a deal. They have no idea how to say to a couple this is just too much$ or the house needs too much work or heaven forbid do you know what a VE flood rating is?

Sleeping at night is worth infinitely more to me than usd, ag or Au... you gotta do what's right, point out everything about properties and the market. Young folks often hate me for it.....

 

[Casey Jones]

talking with a friend yesterday that was listing his house,

just a simple place on small acreage, but on the right side of the tracks,

regardless, listing went live a 8am, by 830, first showing for 9 am

by end of day, 17 showings, first day

ended up going for 20 over

the couple that bought it, apparently while walking it, couldn't take their eyes off it,
wrote a letter with the offer stating 'whatever it takes' just let us know

he didn't push them to their braking point, just signed off on it, and they are the happiest couple ever
they wrote another letter after they found out it was signed, happier than can be

good for them

edit to add, for reference, list was $480k, so it went at $500k
now this is a young couple, and having access to that kind of ching lickety split, continues to make me wonder

What did they buy it for?

And while it doesn't change the point, how much did they owe?

There are some places where a sub-$100k property is now going for $500k.

Not many.

And of course, the flip side is, those youngsters now will be BUYING in this market, somewhere, too.

 

[Densus]

Home Prices Have Begun Falling: Here Are the Cities Where They're Down the Most

What goes up must come down. The real estate price hikes have seemed unstoppable—until now. This is where home prices are falling the most.

www.realtor.com

 

[BackwardsEngineeer]

Just spoke with my team lead he had two interesting factiods..
The % of household income required to buy a home was the highest on record last quarter....

The average appreciation of homes across the entire country was higher than the average household income in 2021...

I am trying to get linkys

 

[Voodoo]

talking with a friend yesterday that was listing his house,

just a simple place on small acreage, but on the right side of the tracks,

regardless, listing went live a 8am, by 830, first showing for 9 am

by end of day, 17 showings, first day

ended up going for 20 over

the couple that bought it, apparently while walking it, couldn't take their eyes off it,
wrote a letter with the offer stating 'whatever it takes' just let us know

he didn't push them to their braking point, just signed off on it, and they are the happiest couple ever
they wrote another letter after they found out it was signed, happier than can be

good for them

edit to add, for reference, list was $480k, so it went at $500k
now this is a young couple, and having access to that kind of ching lickety split, continues to make me wonder

They don't have anything near access to $500,000. They likely have no idea what kind of money they really signed up. Just numbers on some paper.

With a small down payment and 4.5% rate (maybe locked in early or going ARM). They would only need like $9,000 / month income. Still a lot but not bad with two working.

Also just went to bankrate and saw this in the "top" 3 loan offers. WTF

 

[BackwardsEngineeer]

House gone in less than 30 hours, 1% over ask. Could have been 3.5%, they had another offer with an escalation clause... But they bonded with buyers love letter and were happy with what will probably be a 250k+ return after two and a half years... I charted mid six hundreds, listed mid seven hundreds lets see how the appraiser reacts.

My opinion from feedback is that the market has cooled a lot since December... much more realism in the agent response and less please please please sell it to me...

 

[Uglytruth]

Kid at work's parents looking to buy. Pre Approved for 600K. Found a house they like Wednesday. Looked at to Thursday. Listing 425K. Bid 455K - 485K. Did not get house. Sold by end of day.

 

[BackwardsEngineeer]

Kid at work's parents looking to buy. Pre Approved for 600K. Found a house they like Wednesday. Looked at to Thursday. Listing 425K. Bid 455K - 485K. Did not get house. Sold by end of day.

UT,
To your friends parents, or Oldman shopping here is the deal, straight as I can tell it. You need a great agent, not one that looks great in a bikini, not one that just talks a good game nor one that is posted on a billboard. UT, I would have probably got that deal done. First off, as a buyer swallow any instinct to play coy, you decide you want a property, especially if it blows you away call the selling agent and tell them. Its step one. Second, I say what is your seller after, just money, quick out, no repair, no appraisal and a case of beer, a combination of them all... how would you list their priorities. Then i tell the agent I coming over to hand you our offer in two hours, would it be possible for me to plead our case to your sellers??

So based on what ever I can glean as important I get the buyers to structure around that, then i say how much would you be willing to bid that if they say NO you would say I really didn't want it anyway. Whatever number they say I ask if it comes down to it do I have your permission to bid up to additional what percent... 3 .. 5... 7?? Then i write it all up, get a love letter if its a young couple w/kids, or a teacher or military or a grandparent moving to take care of grandkids. So i take all of this with all paperwork prepared including second offer at the higher % and i drag my fat butt to the selling agents office and pray they are dumb enough to let me speak with their sellers...

Sitting in their agents office, I make them reject me face to face.... most realtors have never ever looked someone in the eye and told them no, easy over the phone or email. Face to face... whole other matter. I've been told no so many times, I almost don't respect you in i get an easy yes.

So there it is a well qualified will win this way at least 2 out of 3 times... real agents are worth their weight in bit doodles

 

[EO 11110]

real agents are worth their weight in bit doodles

perzactly -- in my experiences the majority of RE agents are professional dumbasses. find the rare gems

 

[D-FENZ]

I seldom contact the listing agent when looking to buy a property. I always bring my own agent. Either of them are legally bound to represent the seller but I always figured that if I chose my own agent that I had a better chance getting the best representation as a buyer that way. And it keeps the seller on their back foot because they are much less likely to know my real motives or intentions.

 

[BackwardsEngineeer]

I seldom contact the listing agent when looking to buy a property. I always bring my own agent. Either of them are legally bound to represent the seller but I always figured that if I chose my own agent that I had a better chance getting the best representation as a buyer that way. And it keeps the seller on their back foot because they are much less likely to know my real motives or intentions.

Understand D,
Here is my counter to that, I don't want my seller on their back foot, I want the house for my buyer #1, in least painful path possible for all #2, and terms agreeable to all parties #3.......

If I can't get a yes from the seller, I just disappointed my buyer and waisted a lot of my time and gas..... which is why i really, really screen my buyers.

Highly desirable properties gather lots of interest, even in down markets they move first. But why buy anything but the best if you can?

 

[Voodoo]

Understand D,
Here is my counter to that, I don't want my seller on their back foot, I want the house for my buyer #1, in least painful path possible for all #2, and terms agreeable to all parties #3.......

If I can't get a yes from the seller, I just disappointed my buyer and waisted a lot of my time and gas..... which is why i really, really screen my buyers.

Highly desirable properties gather lots of interest, even in down markets they move first. But why buy anything but the best if you can?

I like to find the worst properties. And I just would never buy in a market as competitive as this. Give me the best quality properties in the ugliest form you can imagine.

But yes, in general people want the best house they can get for their price range.

 

[D-FENZ]

Highly desirable properties gather lots of interest, even in down markets they move first. But why buy anything but the best if you can?

I am usually looking for the less desirable properties that would benefit the most from the improvements that I can make to them. The worst or less desirable in any given neighborhood. I always figure that a pristine property has little going for it other than the normal appreciation from a rising market because it's already at the top of the market. Everyone else is looking for turn-key. There is much less competition for a property that needs work and my efforts to rehab a place always pays off better than the standard appreciation.

I like to find the worst properties.

You beat me to it.

 

[BackwardsEngineeer]

Hey up Doo,
Yes you can make a living buying the dogs.... but you know the proper end of a hammer, how to use a level and if need be hire and manage a contractor. Most buyers cannot do this...

D,
Two years I passed on an undersized garage with apartment over it with a dock in a fantastic neighborhood. Had space to build a McMansion.. I could have had it for 850k.... just sold for 1.7 .... if it has a 40 foot dock with 24/7 deep water...

 

[hoarder]

I seldom contact the listing agent when looking to buy a property. I always bring my own agent. Either of them are legally bound to represent the seller

Unless I have an agent I really like, which is rare because so few are likeable, I usually do the opposite from you. I go direct to the listing agent and ask him to be a dual agent. Most states have dual agent laws.
Put yourself in the listing agent's boots. You have one offer from a seller's agent in which you get 3% commission and one offer through you at 6% commission, which one will you represent favorably to the seller?

 

[WillA2]

Unless I have an agent I really like, which is rare because so few are likeable, I usually do the opposite from you. I go direct to the listing agent and ask him to be a dual agent. Most states have dual agent laws.
Put yourself in the listing agent's boots. You have one offer from a seller's agent in which you get 3% commission and one offer through you at 6% commission, which one will you represent favorably to the seller?

That sounds like what lawyers do.

 

[EO 11110]

thing was rolling over before the surge in mtg rates

US Pending Home Sales Tumble For 5th Straight Month As Rates Soar, Mortgage Apps Plunge | ZeroHedge

ZeroHedge - On a long enough timeline, the survival rate for everyone drops to zero

www.zerohedge.com

US Pending Home Sales Tumble For 5th Straight Month As Rates Soar, Mortgage Apps Plunge​

This is the 5th straight month of declines for pending home sales and is right before mortgage rates started to explode higher. This is the lowest Pending Home Sales index print since May 2020...



Source: Bloomberg

And just as we noted with new- and existing-home sales, there is likely far more pain to come as mortgage rates surge...

 

[BackwardsEngineeer]

Unless I have an agent I really like, which is rare because so few are likeable, I usually do the opposite from you. I go direct to the listing agent and ask him to be a dual agent. Most states have dual agent laws.
Put yourself in the listing agent's boots. You have one offer from a seller's agent in which you get 3% commission and one offer through you at 6% commission, which one will you represent favorably to the seller?

hoarder,
It's called disclosed dual agency in SC, meaning you gotta tell everyone and signatures required revealed relationship to client status. I do it as often as it works for both parties.. here this in the best light, if you are in a deal as an agent, you are committed like the pig, not the chicken. So you have to legally do whatever to get it done, for your side or for the other side. Often we end up doing yeoman work to get deals done, so working both sides often produces better service. Normally somewhere in the process, a repair or inspection on the seller side or an inspection, appliance on the buyer side bill comes up and if I'm working both and its smooth as silk I pick up the tab...

 

[EO 11110]

whatcha doin goldman?

 

[Fatrat]

whatcha doin goldman?

View attachment 257789

I hope they lose their ass

 

[hoarder]

I hope they lose their ass

With the Federal Reserve on their side, there's no way to lose.

 

[Fiat Metaler]

Goldman rarely buys at the top. I count that as partial vindication.

 

[EO 11110]

Goldman rarely buys at the top. I count that as partial vindication.

if one thinks that this is a profit seeking move - and not something else

 

[EO 11110]

(frbny) has moved mortgage rates back to the level that they used to pop the previous RE bubble

Mortgage rates hit highest level since 2009​

 

[hoarder]

if one thinks that this is a profit seeking move - and not something else

Exactly. Most people think that monetary gain is the only motive, not control in general.

 

[goldielox1]

whatcha doin goldman?

View attachment 257789

While there should be massive deflation of real assets when rates go up, with the out of control money printing of the govt, it might keep housing prices elevated just because of the massive inflation offsetting the asset deflation.

 

[EO 11110]

Homebuilder Sentiment Slumps In May Amid "Growing Challenges" In Housing Market | ZeroHedge

ZeroHedge - On a long enough timeline, the survival rate for everyone drops to zero

www.zerohedge.com

All 3 of the underlying indices tumbled:

• Measure of present single family sales falls to 78
• Future single family sales gauge fell to 63 vs 73
• Prospective buyers traffic measure fell to 52 vs 61

"The housing market is facing growing challenges," Robert Dietz, chief economist at the NAHB, said in a statement.

"Building material costs are up 19% from a year ago, in less than three months mortgage rates have surged to a 12-year high and based on current affordability conditions, less than 50% of new and existing home sales are affordable for a typical family. Entry-level and first-time home buyers are especially bearing the brunt of this rapid rise in mortgage rates."

By region, builder sentiment declined in all regions except the Northeast.

 

[dacrunch]

Just from a personal perspective, I was able to put down a down-payment on my first house in the 1980's.

But my own kids would still be tenants in their 40's if I hadn't handed them each $100k for their down-payments.

BTW, the purchase price for my first house was $66k - a run-down farmhouse on 160 acres... mountains of mature oak, maple and ash...

 

[Casey Jones]

$100k down payments.

My first house, $2001, was $47k

It had problems, but not what you'd think. Political problems - it was in Erie County, New York. And, structural problems - home built, over several periods, with the original structure starting life as a tool shed.

It was charming. But it was also full of problems, and repairing those problems would have cost more than the house, or the neighbors' houses, were worth.

 

[Cigarlover]

Seriously looking at selling my place and leaving the country. With rising interest rates though I may be to late to this. House needs work but should I bother doing it or just leave it for the new owners to do? Things like 3 rooms need new carpet. Kitchen could use some work. The master bath needs updating but works fine. To me those are cosmetic things that the new owner would want to do themselves. New windows on the other hand are things that I should do.
4 bed 2 1/2 bath. Passive solar, south facing, very well insulated and burns less than 2 cord a year for heating in the winter. Also embankment house so stays cooler in the summer as well. Built in 87. 30 yr roof still has 13 years left on it. Just under 19 acres. Gardens and fruit trees. 2 pear, 4 apple, 15 plum, 2 cherry. 1 1/4 miles down a private dirt road. Zillow says 250-350. I'm happy with the lower number.

 

[Tbonz]

Seriously looking at selling my place and leaving the country. With rising interest rates though I may be to late to this. House needs work but should I bother doing it or just leave it for the new owners to do? Things like 3 rooms need new carpet. Kitchen could use some work. The master bath needs updating but works fine. To me those are cosmetic things that the new owner would want to do themselves. New windows on the other hand are things that I should do.
4 bed 2 1/2 bath. Passive solar, south facing, very well insulated and burns less than 2 cord a year for heating in the winter. Also embankment house so stays cooler in the summer as well. Built in 87. 30 yr roof still has 13 years left on it. Just under 19 acres. Gardens and fruit trees. 2 pear, 4 apple, 15 plum, 2 cherry. 1 1/4 miles down a private dirt road. Zillow says 250-350. I'm happy with the lower number.

Not sure where you are at, but IMHO you would be best listing it at the top end, if someone wants to run you down a little bit, fine.

I'm hearing from people around the upper midwest that people are paying asking or more sight unseen for property outside of the liberal hell holes.

Don't sell yourself short.

 

[Voodoo]

Seriously looking at selling my place and leaving the country. With rising interest rates though I may be to late to this. House needs work but should I bother doing it or just leave it for the new owners to do? Things like 3 rooms need new carpet. Kitchen could use some work. The master bath needs updating but works fine. To me those are cosmetic things that the new owner would want to do themselves. New windows on the other hand are things that I should do.
4 bed 2 1/2 bath. Passive solar, south facing, very well insulated and burns less than 2 cord a year for heating in the winter. Also embankment house so stays cooler in the summer as well. Built in 87. 30 yr roof still has 13 years left on it. Just under 19 acres. Gardens and fruit trees. 2 pear, 4 apple, 15 plum, 2 cherry. 1 1/4 miles down a private dirt road. Zillow says 250-350. I'm happy with the lower number.

Ignore Zillow. Get an appraisal or a couple Agents out for an opinion if you might list. Do nothing except maybe carpet and paint.

 

[dacrunch]

Seriously looking at selling my place and leaving the country. With rising interest rates though I may be to late to this. House needs work but should I bother doing it or just leave it for the new owners to do? Things like 3 rooms need new carpet. Kitchen could use some work. The master bath needs updating but works fine. To me those are cosmetic things that the new owner would want to do themselves. New windows on the other hand are things that I should do.
4 bed 2 1/2 bath. Passive solar, south facing, very well insulated and burns less than 2 cord a year for heating in the winter. Also embankment house so stays cooler in the summer as well. Built in 87. 30 yr roof still has 13 years left on it. Just under 19 acres. Gardens and fruit trees. 2 pear, 4 apple, 15 plum, 2 cherry. 1 1/4 miles down a private dirt road. Zillow says 250-350. I'm happy with the lower number.

Really hard decisions.
What you find important might not mean anything to the potential buyers, but the opposite can be true too.
It's really hard to judge a home you've lived in through the eyes of someone who's never seen it.
"CLEAN" and "Smelling nice" (put bread or a pumpkin pie in the oven before a visit) can make a HUGE difference in "attraction" AND "sale price".
Only local realtors will have direct knowledge of which features are CURRENTLY either turn-ons or turn-offs.
The marketplace is fickle, and the buyers are sheep who follow the flock's fads.
Spending money on fixing the WRONG items will be a net loss.
But replacing old carpeting with cheap laminated fake wood could raise your sale price by tens of thousands... forgetting about costly window replacement...
Good luck...Think "CLEAN" because it's not the handyman husband who makes the decision to buy, it's the nit-picking Better Homes And Gardens wife.
The husband just pays...

 

[Cigarlover]

Good advice from all. Thank you.
I'm an hr south of Columbus Oh. Things in Columbus typically sell fast and over asking lately. Between lack of housing and high lumber prices, it's really driving the market. A large chip maker is also talking about building a billion dollar plant up there which would only add to the problem. I know they asked for concessions and got them but not sure if they made a definite decision or not.

I do have a real estate agent friend who is coming by in the next couple weeks for a visit anyway. Talked with him today and will see what he has to say when he gets here.
Comps in the area are on the lower end of my range but smaller homes on less land and IMO, my place is better but not as in good of condition. I have seen places selling for the higher end of my range as well. 1800-2200 sqr ft in better condition but smaller land and not as private.
So , maybe slap a coat of paint on the inside, finish the dam on the pond and let that fill up the rest of the way and just take care of the landscaping outside until it sells. I might even throw in a couple 4 wheelers and the truck as well as the chipper, splitter and other yard equipment. Maybe even the wine fridge for the right offer. And the gun safe. I do not want to move that mofo. That might actually kill me. That thing is heavy.

 

[goldielox1]

I've been saying for a while now:

Best time to buy is when rates are HIGH
Then refinance is when rates are LOW

Sheeple and (realtor parrots) always get this backwards.

 

[dacrunch]

Good advice from all. Thank you.
I'm an hr south of Columbus Oh. Things in Columbus typically sell fast and over asking lately. Between lack of housing and high lumber prices, it's really driving the market. A large chip maker is also talking about building a billion dollar plant up there which would only add to the problem. I know they asked for concessions and got them but not sure if they made a definite decision or not.

I do have a real estate agent friend who is coming by in the next couple weeks for a visit anyway. Talked with him today and will see what he has to say when he gets here.
Comps in the area are on the lower end of my range but smaller homes on less land and IMO, my place is better but not as in good of condition. I have seen places selling for the higher end of my range as well. 1800-2200 sqr ft in better condition but smaller land and not as private.
So , maybe slap a coat of paint on the inside, finish the dam on the pond and let that fill up the rest of the way and just take care of the landscaping outside until it sells. I might even throw in a couple 4 wheelers and the truck as well as the chipper, splitter and other yard equipment. Maybe even the wine fridge for the right offer. And the gun safe. I do not want to move that mofo. That might actually kill me. That thing is heavy.

Keep your toys if you can.
The buyer's wife won't give a crap and would prefer them OFF the property.
Get the idea?

 

[BackwardsEngineeer]

Hey cigar,
Just saw this... your best price will come from outside your market. So think about exploiting the nuts and berries/gotta get outta dodge crowd. There are several national agencies that market to rural buyers.. United country being one. Is there a possibility of connected property purchase? Loads of 1031's going down and someone might want to roll a big one into yours and a neighbors place. Keep in mind it can be just extra acreage.... then you might snag horse buyer, those folks are both rich and crazy...

Where you going to go?

 

[Voodoo]

Hey cigar,
Just saw this... your best price will come from outside your market. So think about exploiting the nuts and berries/gotta get outta dodge crowd. There are several national agencies that market to rural buyers.. United country being one. Is there a possibility of connected property purchase? Loads of 1031's going down and someone might want to roll a big one into yours and a neighbors place. Keep in mind it can be just extra acreage.... then you might snag horse buyer, those folks are both rich and crazy...

Where you going to go?

Lol. There are also a lot of wanna be horse buyers around here. They just have the latter covered.

 

[Silvergun]

Hey cigar,
Just saw this... your best price will come from outside your market. So think about exploiting the nuts and berries/gotta get outta dodge crowd. There are several national agencies that market to rural buyers.. United country being one. Is there a possibility of connected property purchase? Loads of 1031's going down and someone might want to roll a big one into yours and a neighbors place. Keep in mind it can be just extra acreage.... then you might snag horse buyer, those folks are both rich and crazy...

Where you going to go?

This is great advice. I agree 100%

Talk about the acreage the fruit trees, etc. Someone coming from a commie shithole like I live in will be attracted to that and the price range you gave is cheap. My guess is some out of stater would be willing to offer over list to just secure it and move on with their lives and have a backup plan.

I will admit though that COVID restrictions relaxing everywhere has probably settled this crowd of poeple down a bit.

 

[Cigarlover]

Hey cigar,
Just saw this... your best price will come from outside your market. So think about exploiting the nuts and berries/gotta get outta dodge crowd. There are several national agencies that market to rural buyers.. United country being one. Is there a possibility of connected property purchase? Loads of 1031's going down and someone might want to roll a big one into yours and a neighbors place. Keep in mind it can be just extra acreage.... then you might snag horse buyer, those folks are both rich and crazy...

Where you going to go?

At the top of my property are 56 miles of horse trails. They got a hill climb to get to them but a couple of paths up the hill to do it. Thats where all the morels and wild ginseng is as well. Actually Ginsing, morels, chanterelle and shitloads of other shrooms all over the place. Hickory nuts, black walnut (Only 1 tree) and probably a couple other nuts if you had to survive off of them. Loads of stuff to forage too. Blackberries, so many you could never pick them all.
My daughter knows more about the foraging stuff than I do. She was here last weekend and as we were walking around she was pointing out all sorts of stuff that was edible.
I also though about the out of staters. NYC still has an exodus going on and as they run out of taxpayers, those that are left are going to get stung bad.

My 2 top choices for expiating are Cuba and Chile.