Something Terrifying Is Happening To Real Estate
ฝัง
- เผยแพร่เมื่อ 7 มิ.ย. 2024
- This video has been sponsored and approved by Aura.
Stop data brokers from exposing your information. Go to my sponsor
aura.com/hamishhodder to get a 14-day free trial and see if your personal information has been compromised
TIMESTAMPS
55 2nd Street 0:00
Complete Collapse 3:26
Temporary Turns Terminal 6:04
$920 BILLION DOLLARS 7:15
Contagion 10:10
Silver-linings 13:31
===========
★ LEARN TO INVEST IN STOCKS ★
▶︎ bit.ly/NewMoneyEducation
-------
STOCK ANALYSIS SPREADSHEET
▶︎ www.hamishhodder.com/spreadsheet
-------
STOCK ANALYSIS CHECKLIST
▶︎ www.hamishhodder.com/checklist
-------
SHARESIGHT - Track Your Portfolio (4 Months FREE)
▶︎ www.hamishhodder.com/sharesight
-------
SEEKING ALPHA - News & Analysis
▶︎ www.hamishhodder.com/seekinga...
-------
TIKR - Financial Data & Analysis
▶︎ www.hamishhodder.com/tikr
-------
YOUNG INVESTORS PODCAST
▶︎ Apple Music bit.ly/YIPitunes
▶︎ Spotify bit.ly/YIPspotify
▶︎ TH-cam bit.ly/YIPYouT
-------
★Support My TH-cam Content Directly★
▶︎ www.hamishhodder.com/community
-------
FOLLOW ME ON INSTAGRAM
▶︎ / hamish_hodder
-------
FOLLOW ME ON TWITTER/X
▶︎ / hamish_hodder
BUSINESS ENQUIRES
▶︎ hamish@hamishhodder.com
-------
Disclaimer:
The information in this video is general information only and should not be taken as constituting professional advice from Hamish Hodder.
Hamish Hodder is not a financial adviser. You should consider seeking independent legal, financial, taxation or other advice to check how the information relates to your unique circumstances.
Hamish Hodder is not liable for any loss caused, whether due to negligence or otherwise arising from the use of, or reliance on, the information provided directly or indirectly, by use of this video.
You mean to tell me I paid too much for the tent on the side of the Portland freeway!? It was only for 400k!
Reits?
I believe the retirement crisis will get even worse. Many struggle to save due to low wages, rising prices, and exorbitant rents. With homeownership becoming unattainable for middle-class Americans, they may not have a home to rely on for retirement either.
Consider buying stocks when the economy is not doing well, like during a recession. It could be a chance to buy them at a lower price and sell later when prices go up. Just keep in mind, this isn't financial advice, but sometimes it's better than keeping a lot of cash.
Accurate asset allocation is crucial. Some use hedging or defensive assets in their portfolio for market downturns. Seeking financial advice is vital. This approach has kept me financially secure for over five years, with a return on investment of nearly $1 million.
How can I participate in this? I sincerely aspire to establish a secure financial future and am eager to participate. Who is the driving force behind your success?.
Sonya lee Mitchell is the licensed fiduciary I use. Just research the name. You’d find necessary details to work with a correspondence to set up an appointment.
I looked up her name online and found her page. I emailed and made an appointment to talk with her. Thanks for the tip.
Back in the day, when I purchased my first home to live-in; that was Miami in the early 1990s, first mortgages with rates of 8 to 9% and 9% to 10% were typical. People will have to accept the possibility that we won't ever return to 3%. If sellers must sell, home prices will have to decline, and lower evaluations will follow. Pretty sure I'm not alone in my chain of thoughts.
If anything, it'll get worse. Very soon, affordable housing will no longer be affordable. So anything anyone want to do, I will advise they do it now because the prices today will look like dips tomorrow. Until the Fed clamps down even further, I think we're going to see hysteria due to rampant inflation. You can't halfway rip the band-aid off.
Due to my demanding job, I lack the time to thoroughly assess my investments and analyze individual stocks. Consequently, for the past seven years, I have enlisted the services of a fiduciary who actively manages my portfolio to adapt to the current market conditions. This strategy has allowed me to navigate the financial landscape successfully, making informed decisions on when to buy and sell. Perhaps you should consider a similar approach.
I will be happy getting assistance and glad to get the help of one, but just how can one spot a reputable one?
Finding financial advisors like Melissa Terri Swayne who can assist you shape your portfolio would be a very creative option. There will be difficult times ahead, and prudent personal money management will be essential to navigating them.
I am on her site doing my due diligence. She seems proficient. I wrote her an email and scheduled a phone call. Thanks for sharing
It is difficult to make exact projections for the housing market as it is still unclear how quickly or to what degree the Federal Reserve will reduce inflation and borrowing costs without having a substantial negative impact on demand from consumers for anything from houses to cars.
It will, if anything, worsen. Affordable homes won't be available for much longer. Therefore, I will advise everybody who wants to do anything to do it right now because tomorrow's prices will look lower than they did today. I believe that frenzy brought on by rogue inflation will continue until the Fed tightens its controls much further. It is impossible to tear off the bandage halfway.
Although home prices will eventually decline, for the time being you should transfer as much of your money as you can from the housing market to gold or the financial markets. In addition to the crisis and the increasingly challenging mortgage criteria, the new mortgage rates are absurd. Before the market normalizes, there needs to be a minimum 40% (more like 50%) decline in home prices.Seek out an impartial counsel with knowledge of the financial markets if you are at a crossroads or if you need honest advice on the best course of action right now.
I will be happy getting assistance and glad to get the help of one, but just how can one spot a reputable one?
My CFA ’’ Vivian Carol Gioia, a renowned figure in her line of work. I recommend researching her credentials further. She has many years of experience and is a valuable resource for anyone looking to navigate the financial market..!
I find this informative, curiously explored Vivian on the web, spotted her consulting page, and was able to schedule a call session with her, she shows quite a great deal of expertise from her resume.. very much appreciated
Zoning in the US needs to be fixed. Look at Japan where all types of housing and commercial spaces coexist next to each other and in the same buildings.
What makes this just a touch worse... a few months ago, the powers that be started advertising that commercial real estate is the best sector for investment and "everybody knows" it is a winner.
Which really means that a bunch of rich investors are trying to sell off their portfolios to people who don't know better. Vile.
What country and state/territory is this happening in?
@justintempus7406 new york. There are ads all over saying "commercial real estate has outperformed the stockmarkwt consistently for.... years"
youtube is full of these adverts. I've been talking to people who are also agreeing with them, been trying to inform them its the super rich landlords trying to offload.
@timmyroberts1 :(
A lot of people fall for the "leave it there, it always goes up" not realizing, A. The realities of yesterday are not necessarily the realities of tomorrow. B. The rich need people to believe this so that they can get out early and let everyone else absorb the economic losses. The common person just doesn't have access to the information they do...
I don't think people realize how much remote work has upset commercial real estate. It used to be considered untenable, but now entire media productions are done fully through remote. Movies, music, animation, video games, all of it is now so easy to do you can do it from your bedroom.
I use to work in this building. lol
I feel like this is such a great thing for cities in the long run. Big office buildings are terrible for people. Sure, they can be good for the economy, and potentially good for small businesses that are willing to commute into the city to work near all these offices. But, overall this is going to be such a good thing. Turn these offices into apartments and get more people living in downtown areas.
Unfortunately converting office buildings into apartments is very expensive and in some cases, impossible. You would need the regulations on apartments to be relaxed. Also, the conversion wouldn't result in typical apartments -- more like an open floor plan communal living space. Which may be fine for some, but not for others (especially for those that are married or have children).
lol why live in downtown when you aren’t required to work there. It’s going to just be a bunch of slums.
It wasn't really covid that caused this change,it was more of an accelerant. People used to need to live walking distance from their work. Omnibuses changed that so you could live on an omnibus route from your work. Railways came along and made it so you could live in a commuter town. Cars and motorways meant you could live anywhere with good road links to your work. The Internet means that you can live anywhere and you don't even need to go to work anymore.
High interest rate causes house market declining, less people are buying houses. more empty comericial buildings are converted into residential condos wich results in rental declining.After covid, more people are working at home, artificial intelligence technology has eliminated many office jobs, and commercial buildings are vacant and converted into apartments.
I agree, It's not just the prices, but also the increasing interest rate that is making it more difficult for people to afford homes. With a good FA you can make up your portfolio.
I agree with you. I started out with investing on my own, but I lost a lot of money. I was able to pull out about $200k after the 2020 crash. I invested the money using an analyst, and in seven months, I raked in almost $673,000
Who’s your CFP??
Her name is “Melissa Rose Francks’’ can't divulge much. Most likely, the internet should have her basic info, you can research if you like
I just looked her up on the web and I would say she really has an impressive background in investing. I will write her an email shortly.
At least put Commercial in your title instead of only the words real estate. Please no clickbait. There is already enough of that.
Un its real estate. Go cry somewhere else
The fact that mortgage-backed securities are still legal after what happened in 2008 is insanity.
Powel have literally said they wont be dropping interest rates lol.
Also, at the heart of the problem is addiction to loans, and more specifically, interest only loans
I was in SF in August. Downtown streets were empty at peak hour on a weekday.
As a data point to consider, I'm a stenographer who works in san fran. I see all of the exclusive high end offices all over the city... and I'm the only one using them. 😅
2008 was a very intense and specific crash. When talking about the US economy it’s almost all dependent on what effects consumer purchasing power/confidence and banks lending habits. Office real estate is not a reflection in any way of how American’s are doing, just that some white collar jobs will start to be downsized and go remote. Consumer property demand is a whole other story … even on top of the fact the fed raised interest rates to above 5% demand keeps growing. In fact a moderate crash in housing prices would ironically HELP most consumers since millennials and Gen Z could finally afford homes and start building generational wealth like their parents.
Commercial real estate specifically is in trouble. Your average home will be fine for the next year or so, then we will get that next collapse. It’s all a cycle, because the world economy is completely fraudulent
Thank you Hamish!
one of my favourite channels, thank you
The residential real estate market is also in a very concerning place. I did a linear regression of the HPI (house price index. I used all of the historical data going back to the start of the HPI in the 1960s. My linear regression had an r-value of 96, which pretty much means the linear regression was 96% accurate in its trend. The HPI had been impressively predictable until the Great recession of 08. In the Great recession prices rose about 20% above the trend in my regression. Then briefly dropped below the trend line before returning to the trend line in 2017 and 2018. Then COVID money came and now HPI is almost 35% above the trend set by historical data in the linear regression.. beyond all that the corporate downsizing happening in commercial real estate reminds me of the Ted talk 'Moores law of Real Estate ' by Gunnar Branson. It's an 11 year old video where he essentially predicts this would happen
There is even a 3rd problem: higher interest rates means higher cap rates. So (1) lower revenue, (2) higher debt cost, and (3) lower earnings multiple.
great content mate keep it up
Anyone banking on the Fed cutting rates this year is going to have a problem.
Employment jumped again, look for a raise in interest rates.
I dont understand why they dont convert the buildings to housing.
Gee, if those corporations had not lobbied for euclidean zoning they could have changed those office buildings into residential.
Is the stock market actually getting better or is this the regular market manipulation to entice new investors, I'm currently sitting on an inheritance of 300k and i'm wondering do I invest in stocks or Gold?
Even while $300k mightt seem like much, one bad decision might seriously deplete it. As such, exercise extreme caution in where and how you invest. It is advisable to diversify while retaining 70-80% in secure investments. Along with your budget, you should think about financial advising.
Its unclear which stocks and sectors will lead the market in the next uptrend. Stay away from rebalancing if you do not have giudance from a plannner and invetsment strtegist. My finances have been in order since I got a wealth planner like Monica Mary Strigle working with/for me.
If I may ask, what was your strategy behind this decision? Thank you.
There are many financial coaches who excel in their profession, but for the time being, I employ Monica Mary Strigle because I adore her methods.
Thank you for the lead. I searched her up, and I have sent her an email. I hope she gets back to me soon.
Real Estate is itself at fault. They also do own places where they rent out too, and then either evict or threaten by raising rent costs and the like. I experienced this, and have learned that now they don't have any tenants at all cause of the complaints by myself and many others.
Good Video Hamish, very informative. I wonder if landlords will start to repurpose the office towers as city apartments soon. Big investment, would help some of the housing affordability issues experienced around the world.
Every major pandemic in known history has caused substantial societal change. Painful, but often for the better of society overall. Looks like this time is no different!
Because I WFH, I live in a 15 min city of my own creation. I work at home, I occasionally eat out in town, I grocery shop in town, and I go to the doctor in town. If I really really want to, i'll go to the next town over on the weekend for some different restaurants. Isn't this what they wanted???
So you live 15 mins away from a grocer, a doctor and several restaurants? That’s pretty lucky
Is it 15 minutes by car, or by walking / biking / using public transport? A genuine 15-minute city wouldn't be car dependent.
@@ZoulstormThat’s the case for me and my wife in a town in Texas. We’re also less than 15 minutes from a hospital, not just a doctor. It’s not as rare as you would think.
@@Zoulstormlucky? where is this not the case?
@@kartgal There's a tiny percent of people in the US that have a 15 minute walk to a hospital, a supermarket and a restaurant
How about Australia?
The real estate rhythm seems off lately. Are we dancing on the edge of a housing market crisis, especially in the USA?
Indeed, the real estate waltz feels precarious. I navigated the market turbulence in the UK, and
"CARL JASON COHEN" provided sage guidance. A real estate virtuoso!
Your real estate tale is compelling. Mind introducing me to him. I'm cautiously eyeing the UK market, unsure of the next housing step.
Carl Jason Cohen he is the maestro of real estate acumen. My UK property symphony, orchestrated by him, turned uncertainties into a harmony of wealth. A real estate virtuoso, indeed.
Your real estate sonnet resonates. Can I venture into this property melody with him if I'm just a novice in the real estate rhapsody?
Absolutely! He isn't just for seasoned players; he embraces real estate novices. Your first steps into the property minuet will be guided with finesse.
Some of these big office space holders need to start figuring out how to convert to resi, since there’s the opposite issue happening there.
Great informative information Hammish, where commercial office real estate could have an impact the next equities market down spiral.
Ty for the vid.
Commercial real estate in USA looks like a Ponzi-scheme, many broken promises here to expect.
The average sqft rent price for an apartment in San Francisco is about 4.40$ per sqft.
How can it be that the average sqft price for office space is 92$ per sqft, more 20 times the price.
Don't get it, why office space is more expensive than apartments.
Office space can be build cheaper than apartments.
The demand/supply situation is much healthier for apartments.
Why then paying more than 20 times the price?
From 92$ to 4.40$ is a long way to go.
$92 is an annual figure, not monthly, but you’re right that $92 is definitely not “the bottom”
But those 92 dollars are tax deductible
Firms were paying for prestige via location/address. Similar to the “arms race” of C-Suite compensation. #misplacedpriorities
The problem is that these mistakes charge too much. Obivously its always a ponzie scheme, but if everything was cheaper the pain wouldnt hurt as much. Purchasing power parity is real (literally cashflow and how much you can buy)
You'd think given the falling rents from corporate customers, combined with the sky high price of residential properties, that the owners would put 2 and 2 together and convert some of these to residential buildings.
They can't easily do it... the fit outs are too expensive...
Think about it... apartments have 1 kitchen and at least 1 bathroom... That's 1 apartment, now there's say 10 apartments on the floor... 10 kitchen, 10 bathrooms
Now look at an office floor... There's possibly 1 bathroom and 1 kitchen per a floor...
Now throw in how much carparking is setup for that building, is there enough for the replaced apartments...
etc
It's so difficult and expensive to convert office space to residential space that in most cases the only viable option is to tear down the entire building and start from scratch. It might be easier to convert a cruise ship into an airplane...
Does not work. Apartments are much more expensive to build.
Why apartments are priced 4.40$ per sqft and office space is 91.92$ per sqft?
I cannot understand that.
@@sokolmihajlovic1391 Because companies are willing and able to pay more. It all comes down to how much can they earn per sq ft? If it exceeds the cost of rent by enough, then it is worth the cost.
I read that it's too expensive to convert to residential which is a little hard to believe.
Lemme just bunk in an office downtown. That would do me lol.
Seriously that would be all I need as a bachelor if the price was right.
Imagine what your commute would be like. All you need is a grocery store and laundromat within walking distance and you're living the dream.
@@greenredblue haha I used to live in an apartment above a bar in a city centre location that I worked in. Very very dangerous.
How will this impact Australian Super Funds?
This only applies to metropolitan office buildings in MOST, not all, major cities.
Office space in suburban areas and smaller cities are doing rather well.
So I don’t know if this video was attempting to create hysteria over commercial RE issues, but commercial RE is doing nicely.
I feel so bad. No, I don’t.
Unintended consequences of decades of irresponsible QE. Of draconian International Panic policies. Of real estate companies behaving like they always behave.
You didn’t have to be an expert in anything to see this coming.
Oh, man! Whatever will the rich corporations do?! Maybe force workers to commute to their jail cel...I mean, workplaces again, using more gas, having more accidents, clogging up roads, and having worse lives. That's one idea. Maybe get the Fed to keep 0% interest rates forever to create hyperinflation while wages don't increase so the lowly rabble can truly become serfs again? I guess there are a number of "solutions" possible to avoid this catastrophe!
It's worth pointing out that it's not just offices facing balloon payments. All commercial real estate is in the balloon payment boat and so are many capital intensive businesses.
We gotta start differentiating between the office sector in CRE VS just CRE. Two completely stories going on there
Turn offices into apartments
When you count the empty vacant buildings. And then count the people and businesses that can, and will afford to move in. There are far more structures than people to put in them now. In Seattle the building crash around the corner is going to be epic.
buy physical silver at your local coin shop
as a foreigner, what you guys in 🇺🇸 are missing is that debt is the core problem of basically everything in the US. like, everything. really
If you’re going to use basis points you need to define what they are. 108 basis points sounds big (and has that effect in a video) but it = 1.08%
Lot of office space by me going into residential conversion
turn the offices into housing?
A bit optimistic to say if inflation is beaten then the loans may be refinanced closer to rates of original funding costs.
The increased systematic risk of lending to office alone is going to prevent rates from going anywhere near 2-3%.
The entire commercial loan class going to anything below 5% would be very surprising.
And as anyone trying to buy a home has seen over the last few years financing a mortgage at a rate spread of 2-300 bps makes a monster of a difference on cash flows.
With a 4-500 bps spread theres a long way to go down in rates before rates are nonpunitive on refinancing and refunding in the commercial and corporate sectors.
And thats with tight spreads in corporate funding costs.
Agreed people are being delusional IMO if they seriously think that the fed will cut rates anytime soon. The fact of the matter is that real estate prices, especially big cities like San Fransisco that Hammish mentioned, was simply absurdly overvalued pre-COVID. Lowering interest rates isn't going to change that fact, especially now that people can now work from home and not in outrageously expensive big cities.
So then, given the last housing crises they want to wait and watch the same thing play out again. They could start converting this to housing now before another crash happens but they would rather wait so banks can reposes properties that become worthless as they currently stand so we can they bail them out, again.
San Francisco tenants are facing a unique extra problem. Many of the companies are facing a backlash from employees when a significant number of employees are told to no longer work from home. The employees are strongly resisting this and justifiably telling their company that if they have to work in the office again, THERE CARS WILL GET BROKEN INTO. THIS WILL LEAD TO COMPANIES REDUCING THE AMOUNT OF SPACE IN SAN FRANCISCO OR RELOCATING TO OTHER BAY AREA CITIES THAT DON'T HAVE SAN FRANCISCO'S CRIME PROBLEM. Part of the higher vacancy problem is because of this.
The decline in office rental space could be dealt with by converting it to housing which is in a massive short supply right now.
there is alot of dry powder
If Janet Yellen said it is a bright sunshiny day then you better bring your umbrella.
But this could be an opportunity to solve the house crisis
This already happened in Portland, Oregon. Confound the pandemic with the additions of "Defund the Police", legalizing personal drug use, and unfettered homelessness, the commercial space in Portland has record vacancies.
I will owe nothing and be delighted.
What would Michael Burry know about real estate collapses? 🤣😂
Yeah, but have commercial real estate companies tried skipping Starbucks or avoiding avocado toast?
Or hustling harder? 😂😂😂😂
No one wants to work these days🥺💀
You’re saying things can’t go up forever?
Office space landlords should be lobbying cities to allow more office to residential conversions.
It will be interesting to see how Australian houseing owners i mean banks would fair this storm
Title should of said commercial Realestate
Get your bingo cards ready for failing banks!
Something exciting is happening to real estate
Another thing why commericla real estate being a problem is its most of peoples 401ks (Superannuations)
Also the push for working from home is way overdue, my cousin has been working from home since the early 2000s.
During covid the traffic was so good with less cars off the roads, that should be a big enough reason for the environmentalists to get behind too 💩
Is work from home also impacting business hotels ?
In UK and EU hotels are full as subsidised by governments housing immigrants
Lending is nuts I was offered half a million dollar mortgage with 0 down this week. I’m smart enough to not take that and instead live below my means in a more modest home but if enough people are not we end up in a 08 situation again
Reits?
I am hodling AMZPKK only because that has the right foundation to it
Home values will continue to decline for years. Sad.
Can you explain why most people, who are more interested in residential real estate, should care at all about commercial real estate ?
Of course there will be contagion. The rich will find a way to pass the cost and losses to the common person.
Maybe they should convert some of those into housing? Also, people think real estate is the safest investment one could make, not a bad thing to remember them no investment doesn't involve risks.
Less policing? You don't have to sell more to me, I thought there were downsides
I didnt know commercial real state loans work that way. Sounds crazy.
Wait until the Bank Lending Program stops in a few weeks....
2008 is that you.
Turn them into housings 🎉
I will let you guess who will pay for the mortgages "big business can't afford to pay"
Make em into apartments 😌
All I know is I need California real estate prices to plummet so I can leave this god awful mediocre Midwestern hellscape in the next few years.
Inflation isn't going away that fast
Unsure why he covers U.S but is Australia
awwe poor corporations they already stole everything from us
I have about 5% of my portifolio in AAPL stock, any advice on any other that I can grow my $200 k capital to a million dollars??
I have heard a lot of wonderful things about Andras Bohm on the news but didn't believe it until now.
I managed to grow a nest egg of around 120k to a decent 💲950k in the space of 3 months... I'm especially grateful to Andras Bohm, whose deep expertise and traditional trading acumen have been invaluable in this challenging, ever-evolving financial landscape..
I'm willing to make consultations to improve my situation. What is the most reliable medium to reach him please?
his website appeared right away, You've saved me several hours of research, I appreciate it
12:20 yeah well if you take a look at SF, it went downhill regardless, so all that property tax, who knows where it's going to, too much crime and homelessness anyway
Dang 2 minutes in and a sponsored ad. Lol at least give us until the halfway mark. Peace ✌️
Won’t someone think of the poor real estate investors 😢 they’re going to go out of business because of their own decisions, we have to do something!!!! The whole economy (of real estate investors) is at stake!
hey guy who looks like Elon Musk's little brother: thanks for explaining why financial stocks are down
Uh oh guess it'll have to be affordable housing LOL
Okay, so office crash, but this is meaningless for residential which is the only thing that matters to us normies.
Why should interest rates be lower? Obama should have started raising them in 2012 when the great recession was "over." Instead, they've been kept at close to 0 for 15 years!! We never really recovered from 2008, we just built an even bigger bubble based on debt because debt was so cheap it was practically free, and everyone spent like a teenager with a credit card! That includes our politicians. I dont even know if we could service our national debt anymore if interest rates go any higher. And if they lower rates again this year for the election then inflation will ramp up and theyll have to raise rates in the teens just to stop it like they did back in the 70s. Theres a giant crash coming, there is so much bad debt, but no one wants to be the leader to go through that so they all keep kicking the can down the road making it worse and worse in the end.
Using footage of X while talking of tech leading the way on WFH. Elon being the numpty that he is, insisted x employees come to the office.
You draw absurdly negative conclusions on this one. If companies can operate consuming less of a scarce resource, developed city centre space, then that space will be utilised eventually for other productive purpose. Either through residential conversion or by making prime Office space affordable for other companies currently in less optimal locations
too america focused
Sorry, the calculation makes no sense to me. Companies save money currently, when they save office space. Workers are glad working at home having more time with their family. Space in office towers is freed. So it get's available for richer people to get a flat in a skyscraper wich a lot if people dream of. So space for living and families outside the cities will get more affordable for families. Workers are beginning to claim a bonus for working at home because they know companies have the money, since they currently save it, and companies will pay the bonus, at least for good workers. Good workers will buy bigger houses for their families. Great situation and a win for all people.
Why do these videos all come out years after everyone knew it was going to happen