Real estate decline 2020

infowarrior1

Hummingbird
That is a feature, not a bug, of the debt based economic system we have in the west.
Few people will talk about this, but the debt system actually *requires* never ending growth (which of course is ultimately impossible).
Unless we change the debt system we have, we actually *need* immigration to support constant growth at all times. Our cities must expand, our tax rolls must grow larger, and this year's sales at every business must outpace last year's (meanwhile our roads, schools, airports, and hospitals stay the same size, and we all get squeezed and service and quality go down) or else the system falls apart into insolvency.

This is why we will never see an end to immigration.

The debt will have to be cancelled and/or monetized and we will have to move to a metallic based currency or modern equivalent.
 
Guess who pays for that? - middle class savers and hard workers. Fed did the same thing in 2008. Wall street makes huge profits each time there is a crisis.

What will add to the inflation is banks are now lining up for mortgage meltdown II - to 'help minorities' buy homes - what they are really doing is using minorities to loot the middle class.
 

EndlessGravity

Kingfisher

Some of you know I'm navigating the real estate marketing right now. Inventory down 30% from last year. That's disastrous. A comment on that article mentions how good properties are going in under a day or two while you can find no end of crappy properties on the market at 30 or 60+ days. An extension of rent/mortgage forbearance into April of 2021 is all you need to know. This economy is on the edge of complete meltdown.

This might be frustrating for many people but this, imho, is super exciting. Here's why:
  • We're selling in desirable areas into rising prices with eager buyers
  • We're buying in cheap areas with prices falling from sellers who can't find buyers
  • We've always used more thorough research of assets to find hidden diamonds
To toot my own horn, I'm glad we always planned for this day, even as people said we were crazy (again).
 

Dilated

Robin

Some of you know I'm navigating the real estate marketing right now. Inventory down 30% from last year. That's disastrous. A comment on that article mentions how good properties are going in under a day or two while you can find no end of crappy properties on the market at 30 or 60+ days. An extension of rent/mortgage forbearance into April of 2021 is all you need to know. This economy is on the edge of complete meltdown.

This might be frustrating for many people but this, imho, is super exciting. Here's why:
  • We're selling in desirable areas into rising prices with eager buyers
  • We're buying in cheap areas with prices falling from sellers who can't find buyers
  • We've always used more thorough research of assets to find hidden diamonds
To toot my own horn, I'm glad we always planned for this day, even as people said we were crazy (again).

About to close on a home that was on the market for 1 day...with 2 other offers same day...and had to offer 10% over list price (including a waived home inspection and agreeing to close before 30 days) just to get the deal. Insane market right now. And this isn’t even in a place that most people would consider ‘nice’.
 

Laner

Hummingbird
Gold Member
Canada too has almost no inventory. Dangerously low. Sales to Listings are through the roof. Prices have jumped.

What the hell is happening? I heard part of it might be the skyrocketing cost of wood. I know BC has shuttered a lot of mills recently I wonder if that has had an impact.
 

Max Roscoe

Kingfisher
It's the Toilet Paper Effect. Businesses are shut down and unable to produce. So there is a shortage of repairs / renovations / new construction / home listings. Most of real estate is people moving around (first time home buyers are a small part). People still want to move around, probably even more so than before, as they want to escape the cities in many cases, or perhaps just buy / move into an area in the city that is walkable.

There's no reason that we should be short of toilet paper or coins, but we are, because the vast majority of business is frozen. Likewise real estate. Plus many people are afraid to make any change, so they just stay put, hoping they can stay in place with forbearance or government assistance, which further restrains housing supply. I would be wary of buying much real estate, as the ability of renters to make payments is in question, though if you can afford it, a modest affordsable buy is probably smart. Just keep in mind that economics is not following any sort of logic or formulaic outcome. We are operating outside the rules (hence economies are frozen yet stock markets are somehow hitting new highs).
 

redbeard

Hummingbird
Moderator
Canada too has almost no inventory. Dangerously low. Sales to Listings are through the roof. Prices have jumped.

What the hell is happening? I heard part of it might be the skyrocketing cost of wood. I know BC has shuttered a lot of mills recently I wonder if that has had an impact.
I have no idea what's happening. I was with everyone else at the beginning of this thread, thinking RE would crash. Outside of expected drops in SF, NYC, everywhere else is booming.

I understand that people are fleeing the cities for greener pastures. But second-tier cities aren't really "greener pastures." They're just smaller.

I don't know anyone who's buying RE right now, and it's crazy seeing these listings fly off the market.
 

NoMoreTO

Ostrich
Toronto is hitting some serious headwinds.

I have a condo that just became available as the tenant exited. Inventories are extremely high, rents are coming down.
- Many new condo units have been built this year
- Airbnbs have moved into the rental market
- Exodus from city to suburbs for many to reduce costs

I am trying to decide whether to sell or hold. I have owned for 5 years and can simply hold on.
 

EndlessGravity

Kingfisher
I have no idea what's happening. I was with everyone else at the beginning of this thread, thinking RE would crash. Outside of expected drops in SF, NYC, everywhere else is booming.

10% of people are in mortgage forbearance. That doesn't even count existing foreclosed properties. Stop and think about what that means. During the worst of the 2007 crash, 2% defaulted.

2% vs the current 10%+.

This is a crash, an epic crash like we haven't seen in over a hundred years. You're just seeing how the govt will go to any lengths to change the game in the 9th inning. However, there's a problem... the govt can't change human nature and can't change the game forever.

I predicted in April that prices would keep going up, much to the chagrin of my normie friends.

Edit: Adding if it hasn't been said in this thread yet, there's a 30% reduction in inventory nationwide and about that in my state. That's one reason prices are going up still. That's also a catastrophic sign.
 

SlickyBoy

Ostrich
This is clown world for sure. The debt cannot be paid off, we can't grow our way out of it, and it can't be dismissed because "we owe it to ourselves." The only guy who's made any sense on this wrote two editions of a book about it.

As for the rents dropping in San Fran and NYC, well who'd have thought living in places where Antifa runs wild and the cops are ordered NOT to protect you would have any effect on property values? Yet the Soros-sponsored leftist morons running the cities still think the value will remain and they can tax even more. People vote with their feet, and also their wallets.
 

Max Roscoe

Kingfisher
This is true, but we are far from "government doing everything possible to keep the status quo."

We got one $1,200 check in 6 months. They are talking about maybe giving us a second one. In much of Europe people are getting ~$1,000 monthly as long as economic activity is frozen. That's the difference between having peace of mind that your society will take care of you, and freaking out knowing you are on your own against the powers that be.
 

SlickyBoy

Ostrich
This is true, but we are far from "government doing everything possible to keep the status quo."

We got one $1,200 check in 6 months. They are talking about maybe giving us a second one. In much of Europe people are getting ~$1,000 monthly as long as economic activity is frozen. That's the difference between having peace of mind that your society will take care of you, and freaking out knowing you are on your own against the powers that be.

That's indicative that you don't understand the economics. The money that's going to much of Europeans is what they would have spent on defense, had the US actually held them to the NATO agreements.

Alas, with Uncle Sugar standing at the ready to do whatever needed to be done (the cold war, Kosovo, Libya, etc.), the Euroid governments slacked off and created all those economic social freebies, when in reality it was indirectly subsidized by the US.

Had nobody done anything, the USSR would have stolen the rest of Europe just like they did Eastern Europe after WW2. Sometimes I think we should have let them take it.
 
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Pendleton

Kingfisher
The market is crazy. I had been looking at buying in a small homogenous town with good schools and over the last 1-2 months almost everything on the market has been snapped up.
 

Troller

Kingfisher
10% of people are in mortgage forbearance. That doesn't even count existing foreclosed properties. Stop and think about what that means. During the worst of the 2007 crash, 2% defaulted.

2% vs the current 10%+.

This is a crash, an epic crash like we haven't seen in over a hundred years. You're just seeing how the govt will go to any lengths to change the game in the 9th inning. However, there's a problem... the govt can't change human nature and can't change the game forever.

I predicted in April that prices would keep going up, much to the chagrin of my normie friends.

Edit: Adding if it hasn't been said in this thread yet, there's a 30% reduction in inventory nationwide and about that in my state. That's one reason prices are going up still. That's also a catastrophic sign.
I don´t know if it´s 10% who need the forbearance. Or less. Some of them might just be using the forbearance to dar costs and not because they need.
 

Laner

Hummingbird
Gold Member
10% of people are in mortgage forbearance. That doesn't even count existing foreclosed properties. Stop and think about what that means. During the worst of the 2007 crash, 2% defaulted.

2% vs the current 10%+.

This is a crash, an epic crash like we haven't seen in over a hundred years. You're just seeing how the govt will go to any lengths to change the game in the 9th inning. However, there's a problem... the govt can't change human nature and can't change the game forever.

I predicted in April that prices would keep going up, much to the chagrin of my normie friends.

Edit: Adding if it hasn't been said in this thread yet, there's a 30% reduction in inventory nationwide and about that in my state. That's one reason prices are going up still. That's also a catastrophic sign.

Why is it a "catastrophic sign"?
 
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