Posted on 07/08/2021 11:25:34 AM PDT by blam
If these sentiments become reality over time, it’s going to be a sea change for demand and supply at these crazy prices.
So just briefly: This explains some of the dynamics we have seen in the housing market recently, with mortgage applications, sales of existing homes, and sales of new single-family houses dropping for months even as investors have piled into the market and as inventories have started to rise.
Fannie Mae has been conducting its National Housing Survey monthly since 2010, one of the data collection efforts to come out of the Housing Bust. The survey covers a range of housing-related topics. And in its survey for June – conducted between June 1 and June 24 and released on Wednesday – there are record trend changes in consumers attitudes about whether it’s “a good time to buy a home,” or “a bad time to buy a home,” or “good time to sell a home,” or “a bad time to sell a home.” And you know what’s coming.
The percentage who said that it was a “bad time to buy a home” spiked over the past three months from record to record and in June hit 64%. Consumers cited home prices as the predominant reason.
A record low 32% of the respondents said that it was still a good time to buy a home, while the percentage of fence-sitters who didn’t know dropped to 4%.
“While all surveyed segments have expressed greater negativity toward homebuying over the last few months, renters who say they are planning to buy a home in the next few years have demonstrated an even steeper decline in homebuying sentiment than homeowners,” according to Fannie Mae’s press release.
“It’s likely that affordability concerns are more greatly affecting those who aspire to be first-time homeowners than other consumer segments who have already established homeownership,” the report said.
But it’s a great time to sell a home.
The percentage of respondents who said that it was a “good time to sell a home” spiked to a record of 77%:
Conversely, only 15% of the respondents said it was a “bad time to sell,” and 7% didn’t know.
During the Housing Bust in 2010 and 2011, when prices were low, fewer than 15% of the respondents said that it was a good time to sell. Folks know when homes are priced right to buy and when pricing is ridiculously out of whack for buyers but ideal for sellers, and when it’s time to sell.
But each of these insightful and motivated sellers eager to cash out at these ridiculous prices must find a buyer of the opposite persuasion who thinks they’re getting a deal, which is what makes a market. As the market moves forward, with nearly two-thirds of the people thinking that now is a bad time to buy a home, all these sellers have some explaining to do.
If these sentiments play out in reality, future demand by potential buyers at these crazy prices will be weak; and future supply of homes that sellers want to cash out of at these crazy prices will come out of the woodwork.
Sheriff refuses to evict them - something about "Covid."
Regards,
Nah,
Im still waiting for the “New World Order” to play out...
Doesn't mean anything - except that millions of others (some of whom are already dead, or moved, or...) are also getting the same mass-produced e-mail, from a server farm in Africa.
Regards,
“I get asked at least once a week if I want to sell my house.”
I get the “We Buy Ugly Houses” postcard in the mail every so often. I tell my neighbor I got some of your mail.
[[[I guess a lot of it is people trying to escape big cities & blue states….]]]]
People from high priced urban areas have a whole different concept of pricing.
They look at a currently inflated rent in a suburban area that is half that of the urban area they live in and its cheap while we look at it as expensive.
[[[[Friends of mine who remodel homes for a living say that some of the builders they know are not even bothering with making homes that sell for less than 2-3 million dollars. People buying these houses have so much money paying an extra $500,000 is peanuts.]]]
People here 60 miles north of DeBlasio City are buying houses sight unseen and getting into bidding wars over them.
That’s true and why some places in Florida for instance have become unaffordable to those who grew up there…
It may be a ‘horrible’ time to build a home but if you stay away from the small-time builders (those with low cash reserves) you can make out OK. My son and wife were able to close a contract to build just before all the crazy stuff peaked (if it has). They will be getting a new home for less than what some of the used crap is selling for.
And if I had last night's winning Lottery Numbers, I wouldn't have to worry, either.
I'm very happy for your son and daughter-in-law, but your example does nothing for the plight of the rest of us.
My wife and I were going to build our retirement home this past spring, but our $275,000 house plans became $410,000.
Tell them you want 18.4 million, they’ll quit calling.🤗
I can attest to the statement that it is a fabulous time to sell a house. I just closed on the sale of my home in West Palm Beach, Florida. Full asking price. $90k above appraisal. Four times my original purchase price 20 years ago. 1 week on the market.
Insane.
Friend is a manager at the local Home Depot. He says wood products (plywood, 2x’s, etc.) are starting to come back down.
I should hope so. My local Home Depot is stacked from the floor to the rafters with wood - at prices nobody wants to pay. And I mean literally every single crib from the floor to the ceiling was full of palletized wood.
I take it that it’s even worse to buy a home now as a first-time homebuyer...thanks evil Federal Reserve!
Watch — they won’t go back down more than half way, not in one swoop anyway. 50% retrace.
“My local Home Depot is stacked from the floor to the rafters with wood - at prices nobody wants to pay. And I mean literally every single crib from the floor to the ceiling was full of palletized wood.”
Same at my local one as well. In addition, there is even more stacked out back of the store.
I always say, “500 grand and it’s yours.” It’s appraised at around 280K. They never take me up on it. I bought the house in 2010 for 168K. Owe 71K left. I can’t wait to pay it off. I’m finally to the point that the principal is higher then the interest. I always pay more each month as well. It’s a 30 year fixed mortgage. Hopefully I can pay it off by 15 years.
I walked through the appliances dept at Home Depot last night...they had $10,000 refrigerators. I can imagine there are a few dozen people in that part of Tucson that would buy a $10k refrigerator but why would they go to Home Depot?
Lots of other marked up items, especially the “cheap” brands. Pre-pricing for inflation, I imagine. Local distributors seem to be matching HD pricing too. So I only picked up 3 out of 11 items on my list, went home and ordered the rest online at significantly lower prices. I will have to drive to Phoenix to pick up some bulky items, but even factoring in $0.50/mile it’s still a better deal ($89 vs $459, 5 hours of my time plus expensing lunch at Los Dos Molinos, vs 1 hour and leftovers for lunch).
People have been observing weird out-of-touch pricing at big-box chain stores for a couple of years now. I especially enjoyed the FIFO pricing on lumber last year, where they sold it at the original price until inventory replacement, meaning you could literally buy their stock and scalp it on Craigslist for less than the going rate and still make money. I felt a little dirty, but hey, they needed to clear stock and people were desperate for sheet goods.
However this reminds me of past eras where excessive inventory valuation baited corporate raiders who gutted corporations for their inventory misdeeds.
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