EXPLAINED: The Commercial Real Estate Bubble Just Burst
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- เผยแพร่เมื่อ 17 ก.ย. 2024
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Am I the only one that says "Below" when he does? 😂😂
Yes
@@sb27500 I don't think so lol 🤣
@@sb27500😂
Be Low
Great video! I completely agree with it. Commercial Real Estate market is crashing right now, and in a very fast way. There are also other key factors for that, like the recent remote working. Demand for office space has dropped, leading to more vacancies. Also, the surge in online shopping continues to reduce the need for physical stores, raising vacancy rates. And of course, operational costs, costs for maintenance, taxes, and energy are making this market less attractive as an investment.
Absolutely right
It’s almost as if someone concocted this whole scheme. But that can’t be. Well, I’ll just own nothing and be happy. 😂
Actually we still don't even know if the COVID was created or was only a natural occurrence
@@ScienceofHealthMadeSimple I believe Jon Stewart
@@powerofme7144 I lean towards that perspective too
My three favorite channels: Minority Mindset, Stock Brotha, & How Money Works. Make my week complete! 🔥 🔥 🔥
ClearValue Tax also.
There is nothing "commercial" about real estate if you can't make a profit.
Few people use those big office buildings anyway. They stand around barely occupied and collecting dust. They look shiny and nice to cities though so nobody knocks them down.
Always like when he says down "BELLOW" 😂
Most of the tax burden debt has been moved to residential housing market and products and services to make up for the shortfall . They are calling it inflation .
I'm curious what the solution is going to be.
Bargain real estate
Once again you're spot on with what's happening in the commercial real estate market. I'm just a random MAI and CRE here in the trenches so take what I say with a grain of salt. You can present a seventh step. Banks aren't in the real estate business so, at some point, they'll stop taking the landlord's keys and do what we call "extend and pretend". This means they will extend the loan on the property or restructure it with a lower rate today and a much higher rate two to three years from now. Pushing the can down the road and creating more risk and uncertainty in the future. Yes, a lot of opportunity but also a lot of pain to come. Keep making these good videos.
Rent also continues to go up which makes it worse 🥴
A third option some are doing is converting the building to residential units.
I have read else where that retrofitting office space to living space is horribly expensive. Sewage & water systems are not designed for the volume of high density housing in the average office building.
Easier said than done.
Its not cost effective. Better to start over.
Great info Jaspreet
Remember higher interest rates also act as an inflation cost too, they are an expense to a business owner that he must incur, this can also create higher prices while simultaneously lowering prices because values of assets should drop but operating costs increase. I know it sounds contradicting, think about it, when a business borrows at a higher rate his profits drop, that means he has to past on some of the higher expenses.
Some would buy for the write off. Wait out the mess then sell later.
Great video
So that considered the Debt market right?
So market drop coming soon
Inflation is here to stay; we may only decide how fast a lot of people must declare bankruptcy or foreclose because of risky decisions.
will the commercial realEstate bubble burst be concidered the Black Swan Event
If I have a variable rate loan and use to pay $100 in interest and now do to increase interest rates I now pay $300. Who gets to keep the extra $200? My bank or do my bank have to give the $200 to the Fed?
The bank. Because "the bank can get a higher risk-free rate, why would it lend to you with a higher risk, for lower interest."
The banks can eat those buildings. They one t crazy giving all these loans and now, enjoy all that toxic paper they're holding. all those real estate loans they gave at 3-4% , more losses and these banks are in massive trouble.
I've been buying up VNO puts lol
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Morning ☕️
56th bubble just burst...uh oh...
Time to buy commercial real estate.
No!
Don’t worry tho. Anytime investors stop making money the tax payers pick up the tab since the rich just stop paying on debts after draining the LLC of all money and the llc is a non collectible. Crashes don’t mean anything anymore. The values stay high because big business has set up the rules to always make profits in good times and walk away from it in a crash and just open new new LLCs to buy the same assets again at a lower price and continue the cycle.
Mate you increase the interest rates and forgot to increase the rental income because rents are also not same as interest rates they gone up too
With CRE, as your building loses occupancy you lose pricing power with your tenants and thus have to keep the rents the same or drop them to keep the tenant.
Sounds like you want these buildings to lose value 🤣😂
Bro how do you manage to post everyday…. Crazy
Crash into me
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