Housing Analysis

[Ready2Downsize]

Inventory will remain historic low. People locked into low rates for the life of the loans 15, 20, 30 years at sub 3% will never give it up.

It will be stagflation.

But if they lose their job, they could HAVE to sell which would increase supply and blunt demand.

 

[irvinehomeowner]

Inventory will remain historic low. People locked into low rates for the life of the loans 15, 20, 30 years at sub 3% will never give it up.

It will be stagflation.

But if they lose their job, they could HAVE to sell which would increase supply and blunt demand.

But during this Great Resignation... seems like jobs are plentiful... and with WFH... demand for homes in premium locations is high.

 

[irvinebullhousing]

Inventory will remain historic low. People locked into low rates for the life of the loans 15, 20, 30 years at sub 3% will never give it up.

It will be stagflation.

But if they lose their job, they could HAVE to sell which would increase supply and blunt demand.

But during this Great Resignation... seems like jobs are plentiful... and with WFH... demand for homes in premium locations is high.

I would think that people that can buy 1.5 million and up will have skills and resources to layover the hick up. Those Liar Loans are so outdated, so you don?t have flakes in the systems.

 

[Ready2Downsize]

Inventory will remain historic low. People locked into low rates for the life of the loans 15, 20, 30 years at sub 3% will never give it up.

It will be stagflation.

But if they lose their job, they could HAVE to sell which would increase supply and blunt demand.

But during this Great Resignation... seems like jobs are plentiful... and with WFH... demand for homes in premium locations is high.

I've been thru THREE downturns. I bought a house in 1981 (very, very, very young even for that time, but we had seen housing rocket higher due to inflation all thru high school and thought we'd NEVER get a house. We had bought a townhome in 1980 when Home Bank suddenly dropped rates due to no demand and sold it a year later to buy a house), 1989 (at THE top), 1994 (second home, first one became a rental because I wanted to move back to it eventually and refused to lose money on it), 1998 (tried to convince hubby to sell at THE top but he didn't want to cuz Irvine is Irvine),  2015 (which I own now) and 2022 (which isn't ready yet).

It always looks good at the top. Well in 1981 it didn't (probably on the way down by then) but we did get a big house so we would have a place big enough for kids.

NOT saying this is a top or prices will drop. How would I know that? Right now it looks like prices are going to keep going up up up. Just saying things change, mostly unexpectedly. The trend is your friend.......... till it ends.

If rates pull back, imo it will fuel a bigger frenzy.

 

[sgip]

I'm with @Ready2Downsize and @Compressed-Village on their posts. I've also seen three downturn cycles, and a 4th is inevitable. What causes it? It remains to be seen.  "NINJA" , "NO RATIO", and "Liar Loans" exist and are being funding in ever increasing volume, but they still won't tip the market over like last time.

If Congress changes the laws regarding rental properties (which they won't do) and disincentives rental property deductions, then does the same to mass SFR rental syndicates like Blackstone, while also perhaps increasing capital gain exemptions - a tax holiday for example - then we will see plenty of inventory hit the market at a lower price without increasing housing stock through construction. These changes might even create a rush to the exits if intentionally structured that way lowering prices more than expected. We all know that Congress won't do this, so it's all just killing pixels here, but some market changes will be coming and no matter if your in Irvine or Stanton, one should hedge accordingly.

 

[irvinehomeowner]

My response about losing your job is that right now, everyone is looking for quality employees... if you're buying at these prices, you have a high income (and an in demand position) and thus will probably have few issues finding new employment.

 

[usctrojancpa]

Inventory will remain historic low. People locked into low rates for the life of the loans 15, 20, 30 years at sub 3% will never give it up.

It will be stagflation.

But if they lose their job, they could HAVE to sell which would increase supply and blunt demand.

But during this Great Resignation... seems like jobs are plentiful... and with WFH... demand for homes in premium locations is high.

I've been thru THREE downturns. I bought a house in 1981 (very, very, very young even for that time, but we had seen housing rocket higher due to inflation all thru high school and thought we'd NEVER get a house. We had bought a townhome in 1980 when Home Bank suddenly dropped rates due to no demand and sold it a year later to buy a house), 1989 (at THE top), 1994 (second home, first one became a rental because I wanted to move back to it eventually and refused to lose money on it), 1998 (tried to convince hubby to sell at THE top but he didn't want to cuz Irvine is Irvine),  2015 (which I own now) and 2022 (which isn't ready yet).

It always looks good at the top. Well in 1981 it didn't (probably on the way down by then) but we did get a big house so we would have a place big enough for kids.

NOT saying this is a top or prices will drop. How would I know that? Right now it looks like prices are going to keep going up up up. Just saying things change, mostly unexpectedly. The trend is your friend.......... till it ends.

If rates pull back, imo it will fuel a bigger frenzy.

Love your historical insight and perspective. 

 

[usctrojancpa]

Not what I'm seeing in Irvine LL.  Prices have been melting up in Irvine due to the lack of inventory.  I've said it many times, inventory will be the tell where homes prices are going and right now there is a serious lack of inventory.  Higher prices and rates have taken some buyers out of the market but now instead of 20-30 offers on homes, there's 15-20.  There's have to be some kind of huge shock in the market for prices to come down 15-20%, I don't see it happening.  The rise in prices is a complete reset like 2013 was.

There's only one direction inventory can go from here, especially with the headwinds that are building.

Bring on more inventory because I have a lot of frustrated buyers ready to buy homes.

 

[The Motor Court Company]

just curious, what?s the makeup of these prospective buyers? up/down sizing, relocation, investment, or renters?

Not what I'm seeing in Irvine LL.  Prices have been melting up in Irvine due to the lack of inventory.  I've said it many times, inventory will be the tell where homes prices are going and right now there is a serious lack of inventory.  Higher prices and rates have taken some buyers out of the market but now instead of 20-30 offers on homes, there's 15-20.  There's have to be some kind of huge shock in the market for prices to come down 15-20%, I don't see it happening.  The rise in prices is a complete reset like 2013 was.

There's only one direction inventory can go from here, especially with the headwinds that are building.

Bring on more inventory because I have a lot of frustrated buyers ready to buy homes.

 

[usctrojancpa]

just curious, what?s the makeup of these prospective buyers? up/down sizing, relocation, investment, or renters?

Not what I'm seeing in Irvine LL.  Prices have been melting up in Irvine due to the lack of inventory.  I've said it many times, inventory will be the tell where homes prices are going and right now there is a serious lack of inventory.  Higher prices and rates have taken some buyers out of the market but now instead of 20-30 offers on homes, there's 15-20.  There's have to be some kind of huge shock in the market for prices to come down 15-20%, I don't see it happening.  The rise in prices is a complete reset like 2013 was.

There's only one direction inventory can go from here, especially with the headwinds that are building.

Bring on more inventory because I have a lot of frustrated buyers ready to buy homes.

The majority of buyers that I've seen on both sides are...1. Move-up buyers and 2. Relocating buyers (mostly from LA and NorCal).  Next group of buyers are first-time home buyers and FCBs with investors being the smallest group of buyers.

 

[irvinebullhousing]

Inventory will remain historic low. People locked into low rates for the life of the loans 15, 20, 30 years at sub 3% will never give it up.

It will be stagflation.

But if they lose their job, they could HAVE to sell which would increase supply and blunt demand.

But during this Great Resignation... seems like jobs are plentiful... and with WFH... demand for homes in premium locations is high.

I've been thru THREE downturns. I bought a house in 1981 (very, very, very young even for that time, but we had seen housing rocket higher due to inflation all thru high school and thought we'd NEVER get a house. We had bought a townhome in 1980 when Home Bank suddenly dropped rates due to no demand and sold it a year later to buy a house), 1989 (at THE top), 1994 (second home, first one became a rental because I wanted to move back to it eventually and refused to lose money on it), 1998 (tried to convince hubby to sell at THE top but he didn't want to cuz Irvine is Irvine),  2015 (which I own now) and 2022 (which isn't ready yet).

It always looks good at the top. Well in 1981 it didn't (probably on the way down by then) but we did get a big house so we would have a place big enough for kids.

NOT saying this is a top or prices will drop. How would I know that? Right now it looks like prices are going to keep going up up up. Just saying things change, mostly unexpectedly. The trend is your friend.......... till it ends.

If rates pull back, imo it will fuel a bigger frenzy.

I think when you said 1998, is when you thought that was the top correct? Because 1998 was the best time to buy in Irvine. It was almost the bottom before the fire run up.

 

[sleepy5136]

oh we can easily create more supply by simply removing prop 13. Have homeowners be paying taxes at market values. That will EASILY make people sell as people with 2-4k property taxes will have to pay double or even triple. might not make everyone run for the exits, but it will definitely put more homes in the market.

 

[Ready2Downsize]

Inventory will remain historic low. People locked into low rates for the life of the loans 15, 20, 30 years at sub 3% will never give it up.

It will be stagflation.

But if they lose their job, they could HAVE to sell which would increase supply and blunt demand.

But during this Great Resignation... seems like jobs are plentiful... and with WFH... demand for homes in premium locations is high.

I've been thru THREE downturns. I bought a house in 1981 (very, very, very young even for that time, but we had seen housing rocket higher due to inflation all thru high school and thought we'd NEVER get a house. We had bought a townhome in 1980 when Home Bank suddenly dropped rates due to no demand and sold it a year later to buy a house), 1989 (at THE top), 1994 (second home, first one became a rental because I wanted to move back to it eventually and refused to lose money on it), 1998 (tried to convince hubby to sell at THE top but he didn't want to cuz Irvine is Irvine),  2015 (which I own now) and 2022 (which isn't ready yet).

It always looks good at the top. Well in 1981 it didn't (probably on the way down by then) but we did get a big house so we would have a place big enough for kids.

NOT saying this is a top or prices will drop. How would I know that? Right now it looks like prices are going to keep going up up up. Just saying things change, mostly unexpectedly. The trend is your friend.......... till it ends.

If rates pull back, imo it will fuel a bigger frenzy.

I think when you said 1998, is when you thought that was the top correct? Because 1998 was the best time to buy in Irvine. It was almost the bottom before the fire run up.

No, I just happened to buy in 1998. It wasn't THE bottom. There were people buying properties in Northwood Pointe in 1996 making a great return, selling those and buying newer properties in Northwood Pointe with their equity. Sold my house I bought in 1994 and benefitted from rising prices while my new one was being built.

Sold the property we bought at the top in 1989 in 2000. Not counting the money we managed to make with it being a rental from 1994-2000 we barely broke even. Broke my heart to sell it as I wanted to move back but we didn't like being landlords and loved our "forever" home we bought in 1998 so when we could break even we sold it. It was actually a great time to buy. The fed was lowering rates because of the dot.com bust but we only wanted one house and who knew?

 

[Ready2Downsize]

Disney going to be building some new communities. Rancho Mirage is the first with some 55+ homes included.

Club membership extra.
https://www.foxbusiness.com/real-es...-communities-condominiums-single-family-homes

I think Rancho Mirage may have no mello, although who knows if they might put in a district just because.

Bet they will put in restrictions on rental/air bnb since disney will control the HOA.

Doubt they can get anything available before my two years post selling my current house, but if they can and there is no mello, might see if I can buy something there and transfer my basis.

 

[irvinehomeowner]

Interesting... but I don't think I can live inland even for Disney.

 

[Ready2Downsize]

Interesting... but I don't think I can live inland even for Disney.

Who said anything about living there? 

The tax basis I can move is about $800K. If there is no mello, the cost to own it might be ok for purposes other than living in it.

 

[Liar Loan]

Interesting... but I don't think I can live inland even for Disney.

Irvine is inland though.

 

[irvinehomeowner]

Interesting... but I don't think I can live inland even for Disney.

Irvine is inland though.

If I can bike to the ocean in less than 30 minutes... it's not that inland.

 

[irvinehomeowner]

Interesting... but I don't think I can live inland even for Disney.

Who said anything about living there? 

The tax basis I can move is about $800K. If there is no mello, the cost to own it might be ok for purposes other than living in it.

Ahhh... I though you mentioned the restrictions on short term rentals and transferring your basis because you planned to live there

 

[Ready2Downsize]

Interesting... but I don't think I can live inland even for Disney.

Who said anything about living there? 

The tax basis I can move is about $800K. If there is no mello, the cost to own it might be ok for purposes other than living in it.

Ahhh... I though you mentioned the restrictions on short term rentals and transferring your basis because you planned to live there

I don't have to live there to transfer my basis.

I do wonder what restrictions they will have on rentals though and i doubt they can get anything ready within two years which is my deadline to transfer my basis.