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Posted on 01/06/2022 9:19:02 AM PST by SeekAndFind
Big deal. Those folks want communism anyway. Under communism no one but the senior party members owns anything. And that’s just how they want it.
Home prices tend to be self-regulating. It is only worth what someone is willing to pay for it. And not one cent more.
“ The real issue is wages have not kept up with prices”
No. The real issue is the Fed is creating money at a pace not seen in the history of the USA.
We just closed on a house in Florida, escaping this blue state. Just in time, as rates are increasing.
As for prices, I hope they will moderate as interest rates rise, but there is so much cash sloshing around in the economy, that in hot areas, all-cash transactions will prevent much of a bubble pop. The cash has to go somewhere.
My son and his wife also go to closing later this month with a nice, low, locked-in rate.
Proving once again that, no matter what Communists say, there is no such thing as free money.
What you have is multiple generations of little cowards, afraid to move out of their parent’s homes. They’re all afraid they can’t afford a rent payment or a mortgage payment, plus all the related other bills, because they are used to blowing all their earnings on frivolity.
It’s not so different from other generations, except we had the courage to bite the bullet and venture out, assume the responsibility and pay the money. Now the kids are waiting for the government to save them, and blaming their crushing student debt.
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OK, to be fair, this humongous home price appreciation was already happening BEFORE Slo Joe became President.
After having moved to Texas 5+ years ago, our late 20-something kid (tail end of the the Millennials) just closed on a first house last week. House prices are ridiculous here in Central Texas, but the apartment they were living in was about to spike rents by almost 20% over last year at the end of this month. With 20% down and a good credit score, that 3% rate may start looking good down the line if (when) interest rates spiral upward.
Realistically, why would you expect wages to increase in “Real” terms when the workers aren’t any more productive than they were in 1973? This inflation is just a fake construct to allow governments to pay past debts with future inflated money, so it is really a tax of sorts.
The real housing problem is one of availability, due to social engineering by government, ours or anybody else’s.
China has lots of housing that nobody wants or can live there. We don’t have enough in places where people want to live and work. This is by design, however irrational that design may be.
Lessen the power of government and things will improve.
>>>Home prices tend to be self-regulating. It is only worth what someone is willing to pay for it. And not one cent more.<<<
That’s not true imo. What you find in other western countries is a variety of housing. A varied mix that you rarely find here in America. What is the cause of this? Local zoning laws. Over the decades here in America cities and suburbs have made zoning MORE RESTRICTIVE. This can be from zoning entire towns SINGLE FAMILY, to requiring ever larger and larger lot sizes to build on or the quiet discrimination and refusal to permit apartment buildings. Where I live, try to build a new apartment building with three bedrooms. LOL NO......No town around here wants families to be able to rent an apartment. If you send your kids to the local schools, YOU NEED A HOUSE. At least that’s how the towns see it in regards to property taxes.
Contrast this with the America from 50 years ago. There were more “CREATIVE SOLUTIONS.” Maybe the attic was finished into an apartment. Think of the Cunninghams letting Fonzie live in their attic that they converted to an apartment. Or maybe a garage was converted to a coach house at the rear of the lot. Try doing that today and see how fast the authorities come down on you.
So you fiddle with supply and restrict it and what else can happen but have prices go up. And everyone knows the supply is restricted. That’s the entire point of zoning laws when it comes to residential. It’s all to restrict how dense you can pack people together in a given area. Those with the means are HAPPY TO MAKE HOUSING MORE EXPENSIVE FOR THE LESS AFFLUENT. Whatever it takes to keep them out of living near me is the motto.
Here is just one anecdote to illustrate my point. I know of some vacant land that has been sitting for ten years on the market. To develop it you need to build roads, sewers, sidewalks among other things. And it just sold. Not to a developer but to a rich man who is going to use it for himself. He will build one house and use the excess land for his horse. While it was on the market, developers simply couldn’t justify the expenses with the current density the local town would allow. Instead of adding dozens of homes to the supply in this particular town they were happy with zero new supply. And now the land is off the table. And they will be stuck with exactly one new home. And this probably makes the local town and neighbors happy. And this also does nothing to alleviate high home prices.
That’s the way to lower rents and home prices. Sometimes you have to be patient.
The RENTING chart is the reason why Blackstone and other real estate investors continue to buy rental properties.
23% of people will ALWAYS be renters.
Rent almost never goes down. With the exception of some of the deep blue cities. These are the corporations that are buying multifamily houses and single family houses for cash. It makes it very difficult for the small investor to compete.
Yeah, but Joe did such a great job in screwing up things even more... ;-)
Zoomers? Is that what the latest gen is called?
They should be called DOOMERS 🤪
bkmk
“Rent almost never goes down.”
That’s because expenses never go down, and always go up.
I sold all my rentals right as Covid hit. They were great for 20 years, but creeping expenses made them less exciting, even owned free and clear.
I can buy REITs if I want, no hassles.
I’ll leave the rental market to the big boys in retirement. I’m looking for rural and vacation land these days.
I don’t blame half of them...When I was young, the rents in CA took like half your income or more. And the rents went up every year while wages were pretty much stagnant.
It was like getting choked off in slow motion.
“Big deal. Those folks want communism anyway.”
Yeah... everyone from the last 3 generations really wants communism. There have been no non-communists born since 1970 I guess.
Oh wait, I guess that makes me a communist, I better get ready to vote for Comrade Biden. Thanks for clearing that up for me.
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