Posted on 05/14/2021 3:07:53 PM PDT by blam
A recent report in the Wall Street Journal that cited data from the National Association of Realtors and Fannie Mae caught our eye by highlighting an unfortunate reality of low interest rates: while they initially help even the playing field and make homes more affordable for more Americans, after a while, price appreciation will ultimately make housing less accessible for middle- and working-class Americans.
Using data combined with anecdotes from home buyers, WSJ illustrated how the rapid pace of price appreciation over the last year is affecting the outlook for the housing market, as high prices negate the impact of mortgage rates that are still near record lows.
Nationwide, the median existing-home sales price rose 16.2% in the first quarter to $319,200, a record high in data going back to 1989, NAR said.
Prices are rising so rapidly that they are outweighing the benefit of rock-bottom borrowing rates. In the first quarter, the typical monthly mortgage payment rose to $1,067, from $995 a year earlier, NAR said, even as mortgage rates declined.
Of course, the frenzied state of the American real estate market is nothing new.
The other day, we reported that home sales prices in the country’s hottest markets had risen by their widest level since 2006, according to the Case-Shiller Home Price Index, a closely watched measure of home prices in the US which offers a breakdown by region, as well as nationally. According to Case-Shiller, US home prices in 20 major cities are up a shocking 11.10% year-over-year.
But outside the major metro markets, demand was even stronger, translating into the biggest YoY increase in median sales since 2006.
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(Excerpt) Read more at zububrothers.com ...
“No way is this real.”
M2 up over 25% in the last year. Q.E.D.
Interesting. Haven’t looked at trailer listings for Florida in a while . . .
Actually, it should.
Good for you!
“I track my net wealth on a monthly basis and I use Zillow as a guide to assign a value to my home. My home went up nearly $30,000 in value over the past couple months.”
Zillow said our home value went up 10% in six months. Then it dropped 10% overnight (one day). Two weeks later it supposedly rose 5% overnight.
Zillow value was 16% higher than Realtor.com and 5% higher than Redfin when i checked one day a few weeks ago.
Values all over the place and i think the models need some fine tuning.
I hope not. We sold out in the 2008 runup due to rising taxes and paid cash for a manufactured home in the desert 8 miles away for just that reason. I was in CA before Prop 13 and every 6 months my mortgage was going up due to property taxes being raised. I can just as easily be squeezed out if these types of units start to skyrocket.
The Fed will raise interest rate to protect the bankers. They are the ones who take the first slice of a rate increase, at least if they belong to the inner circle.
It has nothing to do with "curbing inflation". That is just a clever ruse used to distract the mobs, so bankers can avoid hanging from lampposts when the game starts to play out.
Rising interest rates are a product of and a contributor to inflation. You may notice that loan rates go up quickly while interest paid on savings may actually decline. Bankers make their money on the spread.
Inflation is caused when the Fed creates money out of nothing and passes it to Government clients as "Treasury Bonds". It ripples out from there as the Government uses the new money to pay off their supporters and cronies with various spending programs. Most of the programs are terrible investments which produce nothing.
The folks who lose are the ones who save money and find that it has lost half it's value when they finally need to spend it.
Lest you think I am vilifying bankers, please note that they are doing what Governments want them to do and simply taking a small piece of the proceeds.
Governments are to blame for inflation - pretty much always and everywhere. It is a sneaky way to tax the population in a way that most never understand.
Yes. Interesting time.
While it is not uncommon to see contracts that include “diseases,” “epidemics,” or even “pandemics” in their Force Majeure clauses, such contracts often do not define key elements of the triggering events, such as who has the authority to define a pandemic. For the large number of agreements that do not include pandemic-specific language, opting instead to rely on catch-all wording, courts generally try to determine cause, as it relates to performance, and what constitutes an event “beyond a party’s reasonable control.”The government spending triggering this inflation is certainly “beyond a party’s reasonable control.”
“migrating people from other states is a factor.”
It’s a HUGE factor here in North Idaho. Maybe the biggest factor. People are fleeing the hell holes of the west coast states. I met a neighbor yesterday who raised his family in Seattle. He said his #1 goal was to get out of Washington State, so they stopped at the first middle-sized town just over the border in Idaho.
My sister manages apartment houses in the Houston area and said she’s had numerous applicants from California especially the SF bay area. One even described their move as an ‘escape.’
We just paid about 12% over ask for a house in Virginia. We were competing against 20 other offers in a 48 hour window. Hopefully this will continue when we sell our existing in 2-3 months.
Southern Connecticut (NYC suburb)
My son made an offer for a house in Redondo Beach, California (actually agreed to their price) and was upstaged by (he said) money from China.
He said the Chinese had been 'snapping up' every thing in the area.
I read a few months back that anyone in China who has money is getting it out of there. Seems to be some truth to that.
My neighbor, who is married to a Chinese woman from Nanning, China, just paid $250,000 for a condo there. (I just said congratulations and nothing else)
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