Posted on 03/23/2022 6:59:23 AM PDT by Browns Ultra Fan
US housing is getting simply unaffordable.
US mortgage rates are soaring, US home prices are soaring, The Fed’s balance sheet is still growing, and US average hourly earnings are growing at a fraction of home price growth.
The unafforable nature of US housing prices is similar to that of 2005-2007 when home price growth greatly exceeded wage growth.
Another side effect of soaring mortgage rates: MBA refinancing applications plunged 14.37% from the preceding week.
Let’s see if The Fed actually tries to extinguish the affordability fire.
(Excerpt) Read more at confoundedinterest.net ...
And your solution is...?
The morons in the public need to be hurt badly before they will finally understand it’s Dems who are hurting them.
Yes, I know, lots of innocents are hurt too. But, if the morons aren’t educated, the pain for all will continue until there is nothing that can be done.
Yep. This is what I said before. People are getting poorer due to wages not keeping up with inflation. Interest rates are rising. House prices have risen incredibly steeply the last few years. The number of buyers in the market is going to crater when you put these factors together.
What comes next is house prices will have to go back down by a good bit.
Brandon did that!
Rates over 5% will pop the bubble.
They are headed to over 8%.
I bought my first house in 1989 on a VA loan at 10.5%, so it definitely can happen.
And it’s way overdue.
Rates in 89 had already dropped a bunch.
Mortgages rates were over 14%
And the average sale price fell from $423K to $400K. (Fox Business)
It’s a seller’s market. Now is the time to sell. They’re not building medium-priced housing anymore, it’s all $299,000 and up. Housing in good school districts near access roads to a city center, older homes and townhouses and starter homes, will sell fast and garner multiple bids.
Simply Unaffordable! Soaring US Home Prices + Soaring Mortgage Rates + DECLINING Real Wages Makes US Housing Unaffordable For Millions (MBA Refi Applications Drop 14.37% From Preceding Week)
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Wait. You mean housing prices going up 30% in a single year isn’t a sustainable model?
The biggest difference between today and the late 1980s is demographics. The nation’s minuscule population growth rate, coupled with our upside-down age cohort statistics (I read somewhere recently that there are now more Americans over the age of 80 than under the age of 2), are very strong DEFLATION indicators. This kind of environment simply won’t support interest rates much higher than what we have now.
In the Biden Economy and Economic Plan, this is not a bug but a carefully crafted feature. Must not allow uppity peasants to own property.
Unless it is given to them by Government with proper conditions and strings attached.
The only solution is to let the market sort it out. Home prices need to come down, and they will if no one can afford them. However, given the administration we’re stuck with, they will undoubtedly make the situation even worse.
What comes next is house prices will have to go back down by a good bit.
supply and demand. Will have to increase the supply to bring down prices. Do you see that happening?
How is the govt going to fix this? The govt is the economy. “What is good for gm is good for the country” left a long time ago.
Parody of Simply Irresistible
Song by Robert Palmer
Lyrics
How can it be permissible
they compromise my principle, yeah yeah
That kind of house is mythical
It’s anything but typical
It’s a craze you’d endorse, she’s a powerful force
You’re obliged to conform when there’s no other course
She used to look good to me, but now I find her
Simply unaffordable
Simply unaffordable
The loving is so powerful, huh
It’s simply unavoidable
The trend irreversible
Home equity’s invincible
She’s a natural law, and she leaves me in awe
She deserves the applause, I surrender because
She used to look good to me, but now I find her
Simply unaffordable
Simply unaffordable
Simply unaffordable
(She’s so fine, there’s no tellin’ where the money went)
Simply unaffordable
(She’s all mine, there’s no other way to go)
She’s unavoidable, I’m backed against the wall
She gives me feelings like I never felt before
I’m breaking promises, she’s breaking every law
She used to look good to me, but now I find her
Simply unaffordable
(She’s so fine, there’s no tellin’ where the money went)
Simply unaffordable
(She’s all mine, there’s no other way to go)
Her methods are inscrutable
The proof is irrefutable, ooh-ooh-ooh-ooh-ooh
Housing so completely visual, huh
Our lives are indivisible, yeah yeah
She’s a craze you’d endorse, she’s a powerful force
You’re obliged to conform when there’s no other course
She used to look good to me, but now I find her
Simply unaffordable
(She’s so fine, there’s no tellin’ where the money went)
Simply unaffordable
(She’s all mine, there’ no other way to go)
Simply unaffordable
(She’s so fine, there’s no tellin’ where the money went)
Simply unaffordable
(She’s all mine, there’s no other way to go)
Simply unaffordable
Source: Musixmatch
Songwriters: Robert Palmer
Simply Irresistible lyrics © Heavy Nova Music
The demand is going to crater.
Add to all this the climbing rate of commercial vacancies and there is a real estate and lending crash coming. Sit on cash/gold/silver and be ready to buy when the market bottoms out.
My solution is Tenancy in Common, Space Assigned Common Ownerships [SACOs]
https://andysirkin.com/tenancy-in-common-tic/general-information/
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