Homes Won't Be Affordable For a Long Time
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- เผยแพร่เมื่อ 12 ส.ค. 2023
- Will homes ever be affordable again? Not for a long time. This week we'll look at an article from Forbes Advisor that goes into detail about where this housing market is headed.
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Lowering of interest rates will ALSO cause unintended consequences
Exactly, if you lower interest rates prices will go even higher.
@@TheLittletroyboy exactly
@@TheLittletroyboy then tgere in lies the problem. The only way prices truly plummet are if interest rates skyrocket (10%+%). If that happens, then those who can’t afford now won’t be able to afford then.
So, the best people who can afford and wish to own can do is seek out cheaper markets or States and move. But, that’s not always the best decision.
In 2020, interest rates are low, and prices were just right. We need more of that. All that's keeping the price up is greed.
I believe the actual issue is supply, not enough home being built.
And the homes being built have all this extra features and amenities to make them higher price. There needs to be new homes for first time buyers, smaller square feet, not having all of this extra bells and whistles. Homes that are great starter home for a young family of 2 or 3. But this would hardly happen if ever.
In my neighborhood small old houses being torn down and replaced with modern much larger houses going for 80 percent plus higher price. So 450k becomes 750 to 850k
Are you kidding, existing homes like that here in the bay area are going for 800k+
Inflated cost of labor and construction materials will never make housing prices affordable in the short term. It's all related to the high interest rates.
I've accepted I probably won't have a home for at least the next 3 years and I'm okay with that. I'm just going to continue to save, all I can do at this point.
Sailing the same boat my friend!
We will say "elevated prices" for a few more months, maybe 6-8 months. Then, just like goldfish, we'll forget and start to think these price levels are normal. The mob is kind of funny that way.
I doubt it.
What I expect to happen, actually is for the market to crash in a year to two years. Unless they come up with 40 year mortgages this is unsustainable.
Another great video! One thing that confuses me and I believe you outlined the definitions in a previous video( but I have forgotten). What is the defined as a housing recession? Since the guy talked about it being over (according to his logic). I vaguely remember you talking about if the average time it takes to sell a home is more than a certain amount of days/weeks than it is deemed a recession ( like time on the market before house goes into contract). Please help me with this term if you can, or am I confusing it with something else. Thanks for the assistance.
"First time home buyers will need to earn about $64,500/year"? In what city can someone with that low a salary afford a home and one that costs only $256,000? Somewhere in Mississippi? PLEEZ tell me and I'll Zillow myself over there!
Thank you, Jackie ❤
You're so welcome!
Damn. Looks like I'm still gonna be living in that airport restroom stall. 😕
That’s not true. You will be able to afford a house no matter what people say. The reasons why homes appreciate historically 5% a year is because wages grow at this level. The last few years were government intervention and they have stopped fueling the market. Revist this post by March 2024.
I believe in real estate for the long term but this last 3 years are and will not be sustainable
@@johnnycastaneda2371 well we are here
@@raulhernandez6782 And inventory is finally growing 🥳🥳
Florida is up 50% and Texas is up 30% +
With the smallest demand in 30 years as of last month.
Also new house inventory has just hit 2008 levels.
Price reductions to follow 👀
Jackie, I like your vids. Straight and to the point. So glad that you show the text you're reading from (a bit fast), as my auditory processing speed leaves a lot to be desired.
Glad you like them! Hope they help you!
I like your home buying videos. Thanks
Thanks!
The cure for High prices is Higher prices
Prices need to keep going up to keep people from having more babies
Unfortunately, builders justify prices on what they want to sell. People have to let them know everything they add on isn't always needed or always wanted.
Anything can happen in a local market. Most likely flatish prices through 2024. I am not giving up my 3% mortgage any time soon. If you would of bought when the Crash Bros told you Don't Buy life would be grand.
Low Supply and high demand = higher prices. Builders won't build affordable homes if they can make more money building luxury homes. I think a war with China and the resulting depression would drop prices. If 30 year mortgage rates drop down to 4-5% in a year or two, i expect another bidding war frenzy and another 15-20% jump in home prices.
Absolutely. But my theory is if rates come back down to the 5% range, then maybe people would be willing to sell their homes then. Therefore creating more inventory.
I'm in the situation of I own a home and want to relocate 1800 miles away, but I can't sell my home without being able to buy outright the other home. This situation is due to all existing homes being very over priced. I'm at an age where going through bank finance is costly and foolish. I hope for the sake of everyone something good happens here.
Prices are going up. That's good.
Downgrade
@@ebutuoy5088 not great if you’re trying to trade up
Look for seller that can do assumable loan
Similar here. We would like to sell our house, which is close to schools and such, and move to a house about the same size just different layout. It's just not cost effective to do so. I'd be ok with selling this house and paying 100k more for what I want, but now it's like 200-300k more and that's not acceptable.
"Work 3 jobs or relocate" Pon Zinvestor
If real estate prices continue to go up at these interest rates it means the currency is collapsing and the inflationary pressure is so extreme that people aren't going to be able to pay $8000 month for a 2 bedroom apartment in Toronto. It's going to cost that much if interest rates stay at 6% and prices don't fall.
Landlords don't do all this to lose money.
Unfortunately people have to look at moving to other countries. Why did Canada bring in one million people in one year when Canada does not have many good paying jobs
@@sewnsew6770 These people are to serve the rich.
@@jeffmason2691 yes Biden brought 5 million to USA. Now mayor of new York says they must be given jobs (serving the rich)
What’s so oddly weird about this Is that It can’t be sustainable
People, including myself aren’t fooled anymore now a days as have been educated from TH-cam a lot on this subject, and the fact I had made a lot of uneducated mistakes in R E when I has my first house years ago
If you can afford to buy a new home while you still live on your old one then buy it to satisfy your needs THEN moved to your new home and rent the old one. Ptoblem is only going to get worse guys!
Pretty sure the second bounce of the bubble pop is starting now. The next phase is a steep decline in prices at first, but then lower bottoms or slow burn decline for a few more years, even a decade.
That's assuming rates stay at 6%
If rates go down it will cause a mother of a housing boom in alberta to stabilize markets in Toronto.
Alberta is ready to launch and the rate hikes keep taking the wind out of her sails.
Blaming "affordability" on prices and rates is odd rather than building new homes. As long as we're forming more households than building new homes don't ya think maybe affordability will be an issue? Guess I'm just dumb.
Is this actually a bad thing? 230 million Americans (65.8%) own their home. 40% have no mortgage, and almost all with a mortgage have a rate of 4%, 3% and even 2.5% on a house most bought before the 25-40% value increase in the past couple years. So those with mortgages are paying $1000/mo? $1500.mo? Average equity is now about $200k. Aren't these things exactly what owning a home was suppose to be all about?
Only 0.2% of Americans will want/try to buy a home this year. Probably a lot less. And most of them won't have a problem buying. But of course agents make videos screaming "affordability" because that 0.2% of Americans is 100% of those they get their fat commission checks from. So they want viewer the can be converted into clients which can be converted into $$$ so they tell the story they know buyers want to hear...prices and rates are the problem.
Strangely this is the very thing driving demand and supply down and therefore their commissions down too. They're pushing this doom story on social media to get views but the mob hearing the doom just stay away. Buyers wait for the promised "crash". Owners don't even think about selling because all they hear is values are way down, the crash is going to happen next week, everyone is losing their homes, doom, doom, doom mostly being pushed by agents to get views.
Doesn't seem too bright.
I think local Zoning departments that set aside land for affordable homes/condos where builders dont have a choice to build anything else, might solve the problem. Use eminent domain to acquire the land for these areas zoned for affordable only construction. Identify blighted areas (shut down factories etc.). Also limiting the power of the "Not im my backyard crowd" vetoing any building in "their" neighborhood. I would also like to see the construction of "micro apartments" (400 sqft) that rent is only about $800/month for people with low income would help with the homeless problem.