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foreclosures on the rise thread 2.0

BackwardsEngineeer

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VD,
Part of being a national and our relocation department, one stop shop and all of that. Plus through national sales meetings have a pile of cards of agents we've thrown a bone too over the years. So it's not just data, but agents working the markets..

As an example have a bud in Seattle who keeps me in the loop on the post apocalyptic market doings. All for the price of a few beers. One subject that is discussed more than any other at meetings is that all markets follow in lock step, just with a different cadence or timing. It's the reason I keep teasing the paid poster about coming to a neighborhood near them...
 

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Part of being a national and our relocation department, one stop shop and all of that. Plus through national sales meetings have a pile of cards of agents we've thrown a bone too over the years. So it's not just data, but agents working the markets..

As an example have a bud in Seattle who keeps me in the loop on the post apocalyptic market doings. All for the price of a few beers. One subject that is discussed more than any other at meetings is that all markets follow in lock step, just with a different cadence or timing. It's the reason I keep teasing the paid poster about coming to a neighborhood near them...

Ok, well ya.... So unofficial secondary data. Of course you could say we all have a bunch of the MLS data through Zillow and realtor.com now.

We have access to the main city MLS data through such "friendly" means. I can't help it the big city guys think they can come down here and list houses once in a while.
 

BackwardsEngineeer

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Nope not unofficial or secondary, and not sure but you seem a little confrontational... not on your cornflakes just trying desperately to expand thinking, yours included.

Powell added another .75, but I'm sure prices will hold o_Oo_O
 

Lancers32

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Nope not unofficial or secondary, and not sure but you seem a little confrontational... not on your cornflakes just trying desperately to expand thinking, yours included.

Powell added another .75, but I'm sure prices will hold o_Oo_O
No worries real estate prices only go up down here in the Triangle unless they go down.
 

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What mls market are you in?

the canaries in the coal mine are all dead


Back in May, Moody's Analytics chief economist Mark Zandi made a bold proclamation: The housing market would soon enter a home price correction. So far, he looks right. Among the 896 major regional housing markets tracked by Zillow, 117 markets saw home values fall between May 2022 and August 2022.

The housing markets getting hit the hardest by the home price correction fall into one of two groups.

The first group includes bubbly markets like Austin (down 7.4%), Boise (down 5.3%), Denver (down 4.3%), Las Vegas (down 2.3%), and Phoenix (down 4.4%). Those markets saw deep-pocketed buyers from cities like San Jose and Seattle drive up prices far beyond what local incomes would historically support. Those booms fizzled out once spiking mortgage rates sidelined even the affluent out-of-town buyers. That's why markets like Boise and Austin are now teetering on full-blown housing busts.

But the biggest price declines aren't in bubbly markets. Indeed, the biggest drops in home values can be found in high-cost tech hubs like San Francisco (down 7.8%) and San Jose (down 10.6%). Those markets got hit by a double whammy. Not only are their high-end real estate markets more rate-sensitive, but so are their tech sectors.

Research firms like Moody's Analytics, Zonda, John Burns Real Estate Consulting, TD Bank, and Zelman & Associates expect the home price correction to continue spreading across the country. Bubbly markets across the Sunbelt, in particular, remain at the highest risk.

“The longer that [mortgage] rates stay elevated, our view is that housing is going to continue to feel it and have this reset mode. And the affordability resetting mechanism right now that has to happen is on [home] prices. And so there are a lot of markets across the country where we’re forecasting that home prices are going to fall double digits,” Rick Palacios Jr., head of research at John Burns Real Estate Consulting, tells Fortune.
 

Fiat Metaler

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Ok fiat i'll play..
What mls market are you in? What size home, age and style? I have access to a whole world of RE data and will gladly plug you in and see what it gives us... then I'll keep it up to date, for free! yes, just for you, i'll chart your market...

I bought my house in Dec. 2020. You would be hard pressed to find anyone who bought then who is not up 30-50%. Maybe if they live in a high crime area or California or place where people are leaving. I left a medium area because crime was increasing and came to an area in the distant suburbs where people are moving to. I'm an hour from the airport in Atlanta. I used to be a half hour.
 

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Nope not unofficial or secondary, and not sure but you seem a little confrontational... not on your cornflakes just trying desperately to expand thinking, yours included.

Powell added another .75, but I'm sure prices will hold o_Oo_O

That was just me projecting the local Realtor opinions... They tend to get pissy. Well realtors in general get protective of their turf. I don't really give a crap if the house sold low because they used an out of town guy. Might give me a good buying opportunity some day. :green tea:
 

BackwardsEngineeer

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Spoke with a couple of buds in Atlanta... some random quotes on their market..

Buckhead dude, " market continues tight, location and schools major drivers. inventory slowly increasing, with less desperation in buyers. Prices leveling, buyers getting better properties for their $. Todays rate increase could well hit us depending how it effects the jumbo market. Rental prices are our single biggest market driver, if anything happens there it will hit hard"

Douglasville darling, "rolling along, affordability becoming a big issue, gas, food and life expenses really squeezing my buyers. Sellers keep reading the headlines and expect multi offers within minutes.. somethings gotta give"

Marietta mike, " market still solid, inventory creeping up, depending on rates spring is going to be interesting. My five year plan might be changing to a seven to ten years".

Atl guru, "it all depend on where specifically you are in town, we have run up numbers in some select areas that are going to be hard to sustain. We are not at the same level of external influx as we have had since 2020, so growth will have to come internally. Which brings buyers qualifying and willingness into the picture. Sure clean properties will have a buyer, but at a slower pace with way less leverage. Repair requests are back, and negotiations common"
 

Lancers32

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Affordability is the only real driver and that is now off the charts. This cannot be sustained.
 

Uglytruth

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Looking in from the outside.

5-6% fees on a 100K house is understandable. Would think the online 1-2% deals would dig into your business in a tight housing market.
5-6% fees on a 1M house is insane.

They talked into everyone buying a house cuz like the stock market it only goes up, up, up.
Then they talked these same idiots into home equity loans that ate up more then their share of equity.
Then they raised taxes because the house is worth more.
Then they do everything to push prices / interest / taxes / insurance / material shortages, even higher.
Creating debt slaves at every turn.

THEN they raise interest rates trapping people in depreciating assets. Offshore industries leaving nothing but "service industry" jobs.

It seems much more like a trap and a burden than a home and if you don't plan on moving it becomes a burden.
Along with marrage, kids, cars etc.........

Young people can't establish any roots because they need to move to where the work is. Very few jobs last anymore.
 

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Yay more commiefornians spreading like cancer.

 

specsaregood

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I bought my house in Dec. 2020. You would be hard pressed to find anyone who bought then who is not up 30-50%. Maybe if they live in a high crime area or California or place where people are leaving. I left a medium area because crime was increasing and came to an area in the distant suburbs where people are moving to. I'm an hour from the airport in Atlanta. I used to be a half hour.
We bought in july 2020, zillow estimates the value at 35% more than we paid (we paid asking). And we are in a state that people are leaving, but we are in the suburbs that are in much more demand due to work from home and city gone to shit.

Or course there is no way we could/would have paid what we paid if interest rates were what they are now.
 

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Speaking of Zillow.
I just checked out a house down the street that a guy has for sale.
He's been in the house for 15 years.
Some information on the site shows what he paid back then and what I found interesting is they have a spot for estimated amount of money left on the mortgage.
I found that interesting...I checked with a few more of my neighbors houses that I know have paid off houses and the information looks pretty accurate.
Im guessing they are going on county records?
Lots of original owners moved on and now rent out their old house.
 

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This was a good video with a comparison to the rising rate markets in 2006-07. I am not sure how the CAPE ratio is calculated but pretty clear we are on the way to 10-15 points overvalued, looking to drop from ~50 down to 35.

 

Fiat Metaler

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Spoke with a couple of buds in Atlanta... some random quotes on their market..

Buckhead dude, " market continues tight, location and schools major drivers. inventory slowly increasing, with less desperation in buyers. Prices leveling, buyers getting better properties for their $. Todays rate increase could well hit us depending how it effects the jumbo market. Rental prices are our single biggest market driver, if anything happens there it will hit hard"

Douglasville darling, "rolling along, affordability becoming a big issue, gas, food and life expenses really squeezing my buyers. Sellers keep reading the headlines and expect multi offers within minutes.. somethings gotta give"

Marietta mike, " market still solid, inventory creeping up, depending on rates spring is going to be interesting. My five year plan might be changing to a seven to ten years".

Atl guru, "it all depend on where specifically you are in town, we have run up numbers in some select areas that are going to be hard to sustain. We are not at the same level of external influx as we have had since 2020, so growth will have to come internally. Which brings buyers qualifying and willingness into the picture. Sure clean properties will have a buyer, but at a slower pace with way less leverage. Repair requests are back, and negotiations common"

Noticeably none said prices were down. Rate of appreciation slowing, negotiations getting back to normal where you actually have to have a house that doesn't need repairs to sell it. That is far different from prices declining. And with the Fed spitting money left and right, I dont' see prices not being sustained.

As an aside, Buckhead is the best neighborhood. They have a mall with a Nieman marcus. There are shootings there about once a month. Prices there are not sustainable because people are leaving for the more distant suburbs.

Marietta is a huge suburb with a huge range of price points - Mexican immigrants and country clubs. I'm not far from the country club part of Marietta. I live in walking distance to the best private schools in the outer suburbs.

Douglasville is a distant suburb, mostly white rural types but that is changing and not in a positive way, I would expect crime to be increasing and the area as a whole is becoming less distant - if I moved there I would move further out to an area that is still mostly rural.
 

Lancers32

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Up only


FdS5dFZXEAAJoDb.png
 

Voodoo

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Noticeably none said prices were down. Rate of appreciation slowing, negotiations getting back to normal where you actually have to have a house that doesn't need repairs to sell it. That is far different from prices declining. And with the Fed spitting money left and right, I dont' see prices not being sustained.

As an aside, Buckhead is the best neighborhood. They have a mall with a Nieman marcus. There are shootings there about once a month. Prices there are not sustainable because people are leaving for the more distant suburbs.

Marietta is a huge suburb with a huge range of price points - Mexican immigrants and country clubs. I'm not far from the country club part of Marietta. I live in walking distance to the best private schools in the outer suburbs.

Douglasville is a distant suburb, mostly white rural types but that is changing and not in a positive way, I would expect crime to be increasing and the area as a whole is becoming less distant - if I moved there I would move further out to an area that is still mostly rural.

How was your market in 2007?... Cause that is about where you are now. Maybe worse.
 

EO 11110

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How was your market in 2007?... Cause that is about where you are now. Maybe worse.
dont tease me like that. when will be the best time to go shopping for investment props?

the transition from the trump booming/nationalist econ policy to the obama 2.0 corruption/stagnation economy is just a year old. is the bottom 2 or 3 years out?
 

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dont tease me like that. when will be the best time to go shopping for investment props?

the transition from the trump booming/nationalist econ policy to the obama 2.0 corruption/stagnation economy is just a year old. is the bottom 2 or 3 years out?

I don't plan on buying Real Estate as an investment for a generation. Like 20 years, or if I can buy myself a house with a 100oz Ag bar. Whichever comes first. Then again I am apparently a patient man.
 

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I don't plan on buying Real Estate as an investment for a generation. Like 20 years, or if I can buy myself a house with a 100oz Ag bar. Whichever comes first. Then again I am apparently a patient man.
i focus on waterfront lots around galveston bay. it's the local niche that i have the most confidence in
 

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i focus on waterfront lots around galveston bay. it's the local niche that i have the most confidence in

From what I've seen is that land is a great long term investment for the patient. But I'm not sure how that will go now at these prices. Undeveloped land, A.) Does not depreciate unlike EVERY house, B.) Has low carrying costs like property taxes and C.) Tends to do well with inflation (ie a steady ratio between land to the new property cost to build)

But you have to buy at the right price and location. Not easy to do.
 

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From what I've seen is that land is a great long term investment for the patient. But I'm not sure how that will go now at these prices. Undeveloped land, A.) Does not depreciate unlike EVERY house, B.) Has low carrying costs like property taxes and C.) Tends to do well with inflation (ie a steady ratio between land to the new property cost to build)

But you have to buy at the right price and location. Not easy to do.
spot on! exactly why i do it that way -- just add that it's the least pain in the ass too

too, the dirt is the reason for most house price appreciation. bricks and sticks not so much. better to buy two lots than one house
 

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Fiat Metaler

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How was your market in 2007?... Cause that is about where you are now. Maybe worse.

My market in 2007 was very different than it is now.

1. In 2007, jobwise, the economy had overheated following 9/11. Companies were laying people off.

This time, there is a labor shortage. McDonalds is paying $18 an hour, Target even more. My company is hiring people with a lot less experience than they would prefer.

2. In 2007 people were buying houses on spec. I knew people flipping houses being built before they were finished.

Today, I don't know anyone with more than one house. I don't know anyone speculating.

People in my neighborhood are working from home. Many are remodeling their house to put in updated kitchens, baths, and flooring. My son is a teenager but he has a job selling flooring and he's killing it - just got a $1500 bonus.

My neighbors finished their basement and have their parents living with them. I know someone rennovating their house to add an airbnb suite.

So in contrast to 2007 instead of having multiple homes, you are seeing a trend of multiple families in the same home. Let how different that is from 2007 sink in.

3. Rents are way up in my market.

4. How are things in your market?
 

Fiat Metaler

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spot on! exactly why i do it that way -- just add that it's the least pain in the ass too

too, the dirt is the reason for most house price appreciation. bricks and sticks not so much. better to buy two lots than one house

actually its inflation, and secondarily access to high paying jobs. A house in a city that is adding jobs will go up. Houses in the sunbelt, where cities have increased in size because employment has risen, have appreciated. In contrast, houses in some northern rust belt towns where jobs are moving south haven't moved much.

rural land appreaciates if its proximity to services like the grid and grocery stores, and employment, increase.
 

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Voodoo

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My market in 2007 was very different than it is now.

1. In 2007, jobwise, the economy had overheated following 9/11. Companies were laying people off.

This time, there is a labor shortage. McDonalds is paying $18 an hour, Target even more. My company is hiring people with a lot less experience than they would prefer.

2. In 2007 people were buying houses on spec. I knew people flipping houses being built before they were finished.

Today, I don't know anyone with more than one house. I don't know anyone speculating.

People in my neighborhood are working from home. Many are remodeling their house to put in updated kitchens, baths, and flooring. My son is a teenager but he has a job selling flooring and he's killing it - just got a $1500 bonus.

My neighbors finished their basement and have their parents living with them. I know someone rennovating their house to add an airbnb suite.

So in contrast to 2007 instead of having multiple homes, you are seeing a trend of multiple families in the same home. Let how different that is from 2007 sink in.

3. Rents are way up in my market.

4. How are things in your market?

1. So the economy didn't overheat in 2020... For worse reasons including printed money? Sure

2.) I still know plenty of people with second homes. I bet the numbers are higher now and this is far from a wealthy area. Possibly, they just aren't bragging as much as before

3.) Rents have always been going up. Now they are more unaffordable than ever

4.) Similar but slower than yours
 

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Like in Japan....... Mexico,,,,,,, other depressed nations.

Yeah, that's a sign of a weaker economy more than anything. And I predicted that to grow in America, which will put more downward pressure on prices.
 

Fiat Metaler

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No, the economy didn't overheat in 2020-21. It was constrained by shortages. Empty shelves. Lumber prices doubling or more. In 2006-8, it was unconstrained and led to gluts of labor and everything else.

Whats different now is that there is a labor shortage so a recession is not going to create the sort of layoff cascade we saw in 2006-2008. You have 2 bread winner families where both breadwinners got laid off and they just mailed the keys back to the bank.

Today you dont have layoffs. You have hiring freezes, which may auger future layoffs, but the labor market is still tight. Some of the big tech firms have frozen hiring but they are not laying people off.
 

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actually its inflation, and secondarily access to high paying jobs. A house in a city that is adding jobs will go up. Houses in the sunbelt, where cities have increased in size because employment has risen, have appreciated. In contrast, houses in some northern rust belt towns where jobs are moving south haven't moved much.

rural land appreaciates if its proximity to services like the grid and grocery stores, and employment, increase.
the point is that the dirt is what moves big. bricks and sticks move a fraction of the dirt, they are easily replaced commodities. a nice waterfront lot is not on the shelf of every home depot/lowes

learned long ago --- buy more dirt, less bricks
 
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Usury

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No, the economy didn't overheat in 2020-21. It was constrained by shortages. Empty shelves. Lumber prices doubling or more. In 2006-8, it was unconstrained and led to gluts of labor and everything else.

Whats different now is that there is a labor shortage so a recession is not going to create the sort of layoff cascade we saw in 2006-2008. You have 2 bread winner families where both breadwinners got laid off and they just mailed the keys back to the bank.

Today you dont have layoffs. You have hiring freezes, which may auger future layoffs, but the labor market is still tight. Some of the big tech firms have frozen hiring but they are not laying people off.
I got laid off yesterday. Looking around I’m not seeing much of any kind of jobs except software development.
 

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I got laid off yesterday. Looking around I’m not seeing much of any kind of jobs except software development.
Been looking for 3.5 months. 2 interviews. First I ran away from. Second they wanted someone with Fero arm experience that I don't have.
 

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the point is that the dirt is what moves big. bricks and sticks move a fraction of the dirt, they are easily replaced commodities. a nice waterfront lot is not on the shelf of every home depot/lowes

learned long ago --- buy more dirt, less bricks

There is one obvious downside. Houses are good for rental income as they depreciate. Raw Land usually does not yield much income. So it's a longer term speculation.
 

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There is one obvious downside. Houses are good for rental income as they depreciate. Raw Land usually does not yield much income. So it's a longer term speculation.
exactly right

been there, done both. vacation rental condos at the beginning of vacation rentals by owner -- huge revenue and profit, huge pain in the ass. and the tax breaks were killer for the condos

if i were young and hungry i might still be doing rental props. those days are over - unless/until i need to do it again