Posted on 05/30/2023 8:05:47 AM PDT by dynachrome
Elon Musk is once again ringing the alarm on the US real-estate sector.
"Commercial real estate is melting down fast. Home values next," the Tesla and SpaceX chief tweeted on Monday.
The tech billionaire made the comment in response to a tweet by the Craft Ventures founder David Sacks, who said that a big chunk of commercial real-estate debt was due to mature soon.
Musk has previously warned that cracks could appear in property markets following turmoil in the banking sector. For example, the clean-energy pioneer said commercial real estate was "by far the most serious looming issue," and cautioned regional banks could experience a wave of defaults because of their huge exposure to the sector.
The debt-fueled industry has kept investors on edge in recent months, given that it faces a raft of headwinds. These include higher interest rates, tighter credit conditions, and work-from-home trends.
(Excerpt) Read more at markets.businessinsider.com ...
They haven't for a while now. Even in Albany, NY the joke has always been the streets get rolled up after 5pm and it becomes a Ghost Town, except for the bums, druggies and criminals. Covid gave people a legitimate excuse and started a momentum that is unlikely to change.
We do not own an RV but I am fascinated by the RV market as an economic indicator and right now RV dealers across the US are marking down NEW RVs by 40% and even 50% off MSRP.
A year ago they were marking them UP by that same margin!
It's the wave of the future. There's no going back.
I wish average houses were worth $5 dollars. The insurance and property taxes would be less. I wouldn’t want two because of the maintenance.
In some respects, it is like a coat. Do you want your coat to be worth $100,000?
I get it.
The commercial real estate problem is mainly office buildings in city centers and aging retail malls.
Industrial and warehousing are doing well.
An important point to remember when retirement planning. Too many people include home equity in their retirement savings calculations and think they are in better shape than they actually are. You should exclude the home equity of your primary home in your retirement planning. As you will always need a place to live, retired or not.
Once people lose the concept of a house a place to live rather than as an investment - i.e. an expense and secondarily an appreciating asset - then valuations will adjust drastically.
Urban office real estate is in a meltdown because people (and especially women) fear walking past homeless encampments.
The Biden/McCarthy debt deal would guarantee those living in such encampments will have a reliable food supply via SNAP. Therefore, the Biden/McCarthy debt deal threatens billions in commercial real estate and the nation’s banking system.
Yes, housing prices are in a mild decline - -1% nationally - and yes commercial space vacancies are high - anyone watching that sector knows it - but known of it makes Elon Musk a real estate expert or an economic Oracle.
I notice today he was in Shanghai meeting the CCP foreign minister (and former CCP ambassador to the U.S.) to discuss his committment to EV production in China which now amounts to 60% of his EV production. He said there that he is against any U.S.-CCP economic decoupling. Of course he is; he’s made millions selling hugely expensive EVs made with cheaper Chinese labor (Chinese wages are 27% of U.S. wages).
> You should exclude the home equity of your primary home in your retirement planning.
Reverse mortgage adds a nice income for many retired folks. The house is no use to you after you’re dead.
Large corporate single family real estate holdings have never faced a significant downturn.
When they do the collapse could be catastrophic in markets where they have major investments and will be forced to liquidate.
I would cry but I bought my current home right after the last housing crash
Well, *I* haven’t seen a home worth more to me than $100K since there was a U.S.S.R. Nor a car that I’m going to pay more than $25K for.
You are better off planning for your retirement without the equity. If you are able to save what you need without having to dip into your home equity, you will be in much better shape.
I would rather have my property go to my children.
“get rid of the bums”
Bums have constitution rights according to federal judges [except no camping on Supreme Court grounds](and soon will have the unquestionable statutory entitlement to feast on SNAP benefits).
you have no idea what you’re saying and you sound just like a lib in saying it
I couldn’t disagree more.
During my lifetime, owning multiple homes has been one of the most lucrative investments I could have made.
A home is an investment that you can live in, is a more accurate statement
I agree that remote work is the wave of the future. Right now, a lot of companies and banks are trying to force people back into the office but are having only limited success. They can do this with their H1bs and with junior employees, but those who have experience or who are in demand are simply refusing - knowing they can get hired by somebody else who will give them what they want. So employers are just having to eat it.
My team is spread out throughout the country all working remotely.
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