Posted on 06/17/2022 7:27:30 AM PDT by Browns Ultra Fan
We’ve got a line on The Federal Reserve. They don’t seem to care about housing and the mortgage market.
Monthly mortgage payments are soaring as home prices soar AND mortgage rates soar.
Mortgage rates have soared with Fed noose tightening.
Something has to give. Otherwise, winter is coming.
The theme song of The Federal Reserve thinking that rising prices can be tamed by raising rates is “Dear Mr Fantasy.”
(Excerpt) Read more at confoundedinterest.net ...
Tightening rates going into recession.
Because its worked so well in the past. /sarc
1Mortgage Rate History: Check Out These Charts from the Early 1900s
2Here's how much home prices have risen since 1950
“..Biden and Powell = massive train wreck...”
Indeed.
The inmates are running the asylum now.
I don’t get the claim that rising interest rates doesn’t reduce home prices. Higher interest rates should reduce demand, and lower demand usually means lower prices, right?
Recent home buyers inflated prices, because they were primarily concerned about the monthly payment, not the dollar amount financed. So long as they could service their debt, they were less concerned about how deep a hole they dug for themselves. All well and good unless the market turns, home values drop, and one needs to move.
Our economy is running on debt—amazing amounts of debt.
5-6% might not be so bad except that home prices have surged, particularly so in desirable locales.
And then there’s rising property taxes, utility costs, insurance, maintenance, etc.
The point being total cost of home ownership is getting to be very onerous.
Volcker killed the stagflation of the 70's by jacking up interest rates in line with inflation.
Regardless, the only way they can counter inflation is to raise the interest rate or increase the fractional reserve required by banks.
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The government could help out by doing things to increase supply (e.g., cut taxes and burdensome regulations on businesses). But it does just the opposite.
When the only tool you have is a hammer... everything looks like a nail.
I was just talking about the Fed. There’s a laundry list of things the Fedgov could do including shuttering entire departments and allowing more drilling, pipelines, etc.
That won't solve the inflation-related problems with oil prices and the idiotic sanction war Biden started with Russia. That is completely the fault of Biden regime policy.
There’s a laundry list of things the Fedgov could do including shuttering entire departments and allowing more drilling, pipelines, etc.
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Yes, it is a LONG list and the GOP should be pushing for every item on it. Reducing the size, power and scope of the federal government should be at the top of the list IMO.
Property taxes are outrageous. Much of it goes into schools for a growing population of illegals, rainbow cross walks, more and more bike trails, affordable housing for those who aren’t pulling the wagon and still having potholes that will take a wheel off.
Imagine what will happen when the economy goes into recession(s) and how much money it will cost to support the millions of illegals who have poured into the country. With little work available for them the taxpayers’ will have to shoulder the burden of their welfare.
“lower demand usually means lower prices, right?”
That is true—but the housing market is very “sticky”, particularly on the downside.
That is because sellers will refuse to lower prices (unless they must sell immediately) so for many months there can be a large gap between the asking price and the price folks are willing to pay.
There will be lots of bizarre “games” to bridge the gap (seller financing, direct or indirect).
It may take several years before the market reaches equilibrium at lower levels.
The only person who requires more Scope is Pelosi in order to cover the alcohol on her breath.
I get madder than a hornet—we can’t afford what we have and they’re squandering the dollar as the global reserve currency which means we’re up a creek without a paddle.
That makes sense (housing prices “sticky” on the downside). Even if buyers dry up, sellers would likely hold onto a property rather than lock in a capital loss—unless they really needed to sell. If the low interest mortgages are assumable, that may be a way to sell even at an inflated prices as rates go up. Funny thing about money. People don’t like losing it.
#13 My aunt & uncle in Mountain Lakes, New Jersey had a single story home with a basement that opened to the back (on a hill) that cost $43,000 in 1959. My uncle told me in 2003 that he was paying $9,000 in property taxes a year!!!
The average property taxes paid today was 2.1% Mountain Lakes, New Jersey.
Property tax for 2021 for their old home was $16,968 !!!!
Sold on 07/03/19: $625,000 Zillow estimate today: $881,500
What the place looks like in Sept 2013. As I use street view I can see my aunt & uncle in the kitchen : )
https://tinyurl.com/2zhkfpz6
If you go up the hill, the 2nd house up he told me as it was being remodeled that it was a million dollar home. That would be over $25,000 in tax and going up every year!!
+—————————————————————
How Much are Homes in Mountain Lakes, NJ?
The Median Home Value of owner-occupied homes in Mountain Lakes is $861,800.
How Much is Property Tax in Mountain Lakes, NJ?
The Average Property tax in Mountain Lakes, NJ is $21,625.
Compare this to the average property tax in New Jersey of $9,115.
Nice property.
All that talk about build back better and that we’ll own nothing and like it—heck, we’re already there, although I certainly don’t like it.
We don’t own our property and never will, not as long as they can tax our property and then take it from us if we don’t pay up. It’s theft in my opinion and it has gotten way out of control.
People who own nothing and don’t pay property taxes can vote to raise taxes on property owners—that’s a problem—legal pick pocketing by a bunch of spendthrifts.
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