Posted on 03/30/2021 6:40:21 AM PDT by blam
WASHINGTON (AP) — U.S. home prices increased at the fastest pace in seven years in January as the pandemic has fueled demand for single-family houses even as the supply for such homes shrinks.
The S&P CoreLogic Case-Shiller 20-city home price index, released Tuesday, rose 11.1% in January from a year earlier. That's the biggest gain since March 2014. Prices rose in all 20 cities, and the 12-month increase was larger for all cities in January than in the previous month.
“January’s data remain consistent with the view that COVID has encouraged potential buyers to move from urban apartments to suburban homes,” said Craig Lazzara, Managing Director and Global Head of Index Investment Strategy at S&P DJI. It's not yet clear whether that trend will fade as the pandemic is brought under control, Lazzara said, or if there will be a permanent shift higher in demand.
The biggest price gain was in Phoenix, where home prices jumped 15.8%, followed by Seattle...
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Couldn't agree more. I cancelled looking for a new home and selling my townhome because I just don't want to pay these inflated prices to get back into a single family (stand-alone) home.
Can I afford to? Yes. Will I? No. I'm just not willing to pay these prices only to have the bubble pop later and have my home be worth less than I paid for it. Just not going to do it. It's not financially responsible.
True. The Amish are big in milling around here, and their lumber prices remain in line with the raw lumber. And it is amazing quality! Wipe with tack cloth and grab the stain.
True, and all real estate is local.
However, here in NH we have been going UP for 10 years now.
The largest percentage increase has been in the last year.
That is typically an indicator of a topping market in ALL COMMODITIES.
Yes, much of the push in the last year has been to people escaping the big cities for the suburbs and country. There has also been a many first time home buyers(25-35 year olds) that have been renting for the last ten years.
Interest rates have been increasing now for about 6 weeks. They are going to continue to increase. That is why the Nasdaq is also correcting.
My point is NOTHING goes up forever. We are most likely seeing the highs in real estate pricing right now on average. That may not affect Boise, Phoenix and Jacksonville as much as it does other cites. Their top may be next year.
Prices have doubled in most major markets in the last 10 years. We are over due for a correction.
I think YOU ARE RIGHT...plus with ability to work anywhere by many has people moving.
Nailed it again Jeeves.
As we're typing this, real estate too is becoming unbuyable, along with guns, ammo, tires, wood and a lot of other stuff.
People don't want money - which tells me inflation is here.
I have a friend who has a rental he was thinking about selling. I said...sell it now and run. I’m not sure when but the housing market has to crash. Once they lift the foreclosure moratorium they’ll start to hit the market en masse.
The other major reason people are moving out of the big cites is SAFETY.
They are afraid to walk their dog at night. This is the exact reason I heard from someone who lived in a high rise condo in north Chicago and bought a house in the suburbs near the WI border.
The race riots last year have scared the heck out of the millenials and even liberals who used to love living in the city.
“I never read that. I did read “The Big Short”.”
My impression is that the financial wizards created gambling games to make more money. Plus, homeowners were way too far in debt leading up to the crash.
All sounds great until you realize people are bringing their commie beliefs with them. Just another positive of the pandemic from the leftist point of view.
Houses in our neighborhood are selling in one day. Our neighbors house just sold 15 minutes after the sign went up. Its kray kray and we are going to cash out as soon as we finish rehabbing.
Indeed. Most of these people will bring leftist politics with them.
I am honestly not following you from thread to thread.
One of our tall firs fell on a neighbor's house a couple years ago, it was actually the second time one of our trees damaged his house in ten years. So last year I cut down 14 of the threatening monsters on our property. A guy with a portable saw mill helped me and we moved them to a neighbors place where he set it up. He was suppose to give me part of the lumber in return so I could build a new stairwell in our three story house.
After he cut up about half the pile he got tired and sold the rest of them. Technically his mill could handle them, but most of the pieces they were a little too large and heavy for him too work with. So even though I was the one who did the majority of the work climbing, cutting, cabling, running up and down the hill, etc... and they were my trees... he got the lumber he wanted to build a smoke house and the money for the wood he was suppose to cut up for me. I am still a little steamed about it.
One of the logs was so large in diameter that he had to sell it separately, because most of the mills around here no longer want logs larger than about 20” in diameter because they are harder to handle. It was news to me. The bases of most of the trees I cut down were 30” or more. And for the greenies here they were not “old growth” they were a fast growing variety of fir planted in the 50s and 60s. They are beautiful but they start falling over in wind storms when they get too big. We had half a dozen near misses in the last few years, not to mention the two that actually caused damage to my neighbors house. These trees are so large and heavy that they cut through a house like a knife through butter when they come down.
It might be that now that a 2x4” stud is going for $6 that large logs are profitable again for local mills. But up until we cut down a bunch of ours... I always thought that the big trees were the best. When I was young I ran a family reman lumber mill for years before I got a cushy government job fighting fires. We made finished products like siding, flooring, paneling, etc...
I personally sorted and stacked millions of feet of product over the years I was doing it. We typically got between 1.5 and 3 cents per lineal foot for doing finish work on other companies lumber. Our machines typically ran at about 100 feet per minute and other than feed tables we had no "green chains" to sort the wood with. We did it all by hand so it was very good exercise. My brother-in-law the logging truck driver called us "sliver pickers". I typically did not wear a pair of gloves because they would wear out in about a day.
“Doesn’t this just mean your money is worth less?”
The question nobody asks.
Everyone has equity in their homes, but many have no income to pay the mortgage, and are months, if not years, behind. Expect to see a flood of Chapter 13 ad Chapter 11 bankruptcies filed where debtors are trying to get sale plans approved to cash out instead of being foreclosed on.
Do you have a second home already, or are you going to rent, or buy?
“Who is buying all of these houses?”
_____________________________________________________
It really isn’t the people who are buying that is driving the costs up. What is happening is that very few people are putting their houses up for sale because sellers are afraid of letting China Virus into their houses. In my area outside of Baltimore, home sellers are having 20 buyers per day looking at their house. Everybody is getting over the asking price, usually with cash/no inspections. There are so few houses on the market that bidding wars are common. Counties with 500,000 plus residents have 15 houses up for sale. In some neighborhoods, potential buyers are knocking on doors asking people if they intend on selling their houses. This is definitely a “supply side” issue.
What goes up will come crashing down.
Financial Rule of Thumb, when everyone is doing one thing, do the opposite.
The best play, if you can, is to sell, rent as cheap as you can for 6 to 12 months, and then buy.
It will be about a 25% correction, if my guess is right.
I am not sure where you are located but most mills in the Pacific Northwest can not handle timber over 24” in diameter. Some sawmill are even smaller than that.
However, there is an export market(Japan & S Korea) for those size logs. You would need to have enough to fill 40’ containers. They also may ship them break bulk. So, before you cut them down, you want to know what length you should cut the logs to.
I do not deal in timber, I am exclusively a lumber broker.
There are a very sawmills in OR, ID and WA that can process that timber domestically.
The other issue is most sawmills do not want timber that came from someones back yard. There is too much danger that somebody drove a spike/nail/metal into it 30 years ago and the tree grew over it. Sawmills use metal scanners to keep their equipment from being damaged, but they are not perfect.
Most likely by 2023 is an average American home price of 500K, the Dow at 50K, and small dollar savers and fixed income benefit recipients (i.e., Republican voters) wiped out.
My neighbor auctioned off all his property about nine years ago. The 20 acres next to me was purchased by a logging company. They took the “big stuff” and then sold the property to me. What I got out of it was several really nice “roads” around my property that have been turned into walking/biking trails, and a lot of piles of “firewood” grade lumber. Adding that to the seven acres or so of trees on my property, I believe I could actually get bids from local loggers (including him) to do it again on that property and for the first time in about 15 years on my original 12.5 acres.
We have a lot of hardwood here. Hickory, oak, maple, etc. Quite a few Tulip trees too, but I don’t know if they are worth much. Doing this sort of stuff is actually a thing around here in central Kentucky.
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