Housing Analysis

[irvinehomeowner]

Ivy Zelman has a solid record of correct housing calls.

The housing market's next big crisis: too many homes

When this takes place, do you think certain areas will be hit harder than other areas? What areas/properties do you think will weather the downturn better?

I think the demographic headwinds will affect the entire nation to some extent, but the less desirable secondary markets will probably take the brunt of the damage because that's also where the most homes are being built.  SF, LA/OC, and SD will always be top tier markets that thrive no matter the demographic headwinds, because there are many priced-out people that would move here given the chance, and relatively few homes being built.

So you're saying Irvine will do better than others.

 

[Liar Loan]

Ivy Zelman has a solid record of correct housing calls.

The housing market's next big crisis: too many homes

When this takes place, do you think certain areas will be hit harder than other areas? What areas/properties do you think will weather the downturn better?

I think the demographic headwinds will affect the entire nation to some extent, but the less desirable secondary markets will probably take the brunt of the damage because that's also where the most homes are being built.  SF, LA/OC, and SD will always be top tier markets that thrive no matter the demographic headwinds, because there are many priced-out people that would move here given the chance, and relatively few homes being built.

So you're saying Irvine will do better than others.

Yes, this time.

 

[irvinehomeowner]

Ivy Zelman has a solid record of correct housing calls.

The housing market's next big crisis: too many homes

When this takes place, do you think certain areas will be hit harder than other areas? What areas/properties do you think will weather the downturn better?

I think the demographic headwinds will affect the entire nation to some extent, but the less desirable secondary markets will probably take the brunt of the damage because that's also where the most homes are being built.  SF, LA/OC, and SD will always be top tier markets that thrive no matter the demographic headwinds, because there are many priced-out people that would move here given the chance, and relatively few homes being built.

So you're saying Irvine will do better than others.

Yes, this time.

Success!

 

[usctrojancpa]

Looks like bond rates are rolling over as the market is pricing in a higher % chance of inflation and 10-year bond rate is below 2.90%, which I believe we'll get by the end of the this year/early next year.  If that happens, bond rates will roll over and mortgage rates will follow. 

 

[talkirvine]

Looks like bond rates are rolling over as the market is pricing in a higher % chance of inflation and 10-year bond rate is below 2.90%, which I believe we'll get by the end of the this year/early next year.  If that happens, bond rates will roll over and mortgage rates will follow.

Yes, 10-year treasury yield has been coming down from the high. Fixed mortgage rate will follow.

 

[usctrojancpa]

Looks like bond rates are rolling over as the market is pricing in a higher % chance of inflation and 10-year bond rate is below 2.90%, which I believe we'll get by the end of the this year/early next year.  If that happens, bond rates will roll over and mortgage rates will follow.

Yes, 10-year treasury yield has been coming down from the high. Fixed mortgage rate will follow.

They already have, one of my lenders told me they are at 4% for a 30-year fixed jumbo loan today at 0pts.

 

[talkirvine]

Looks like bond rates are rolling over as the market is pricing in a higher % chance of inflation and 10-year bond rate is below 2.90%, which I believe we'll get by the end of the this year/early next year.  If that happens, bond rates will roll over and mortgage rates will follow.

Yes, 10-year treasury yield has been coming down from the high. Fixed mortgage rate will follow.

Wow, that the lowest I have heard recently. Would you mind sharing who the lender is and who your contact is? Thanks.
They already have, one of my lenders told me they are at 4% for a 30-year fixed jumbo loan today at 0pts.

 

[usctrojancpa]

Looks like bond rates are rolling over as the market is pricing in a higher % chance of inflation and 10-year bond rate is below 2.90%, which I believe we'll get by the end of the this year/early next year.  If that happens, bond rates will roll over and mortgage rates will follow.

Yes, 10-year treasury yield has been coming down from the high. Fixed mortgage rate will follow.

They already have, one of my lenders told me they are at 4% for a 30-year fixed jumbo loan today at 0pts.

Key Bank with 30% down.

 

[usctrojancpa]

Wow the 10-year is now below 2.80% and oil is down $10 per barrel, crazy action.

 

[Liar Loan]

The largest increases in inventory are out West, followed by the South.

 

[Liar Loan]

Percent of Pending Sales that Fell Out of Contract in June
Nationally, 14.9% fell out of escrow.

Las Vegas ~        27.2%
Phoenix ~          24.5%
Salt Lake City ~  22.4%
Boise ~              21.5%
Riverside ~        20.9%
https://digg.com/real-estate/link/a...ng-rent-pending-sales-falling-out-of-contract

 

[usctrojancpa]

Percent of Pending Sales that Fell Out of Contract in June
Nationally, 14.9% fell out of escrow.

Las Vegas ~        27.2%
Phoenix ~          24.5%
Salt Lake City ~  22.4%
Boise ~              21.5%
Riverside ~        20.9%
https://digg.com/real-estate/link/a...ng-rent-pending-sales-falling-out-of-contract

No surprise that the hottest markets with the biggest % price run-ups make up the top of this list (ID, FL, TX, AZ, and NV). 

 

[daedalus]

I'll know we're close to a bottom when the daily spam texts from strangers offering to buy my house stop.

 

[paydawg]

I'll know we're close to a bottom when the daily spam texts from strangers offering to buy my house stop.

I get those texts for properties I don't even own

 

[usctrojancpa]

I'll know we're close to a bottom when the daily spam texts from strangers offering to buy my house stop.

You guys are lucky, I get both the texts and phone calls.  haha

 

[Liar Loan]

Six months ago, my views on housing were considered extreme.  Now even mainstream economists agree with me.

US housing market could be headed for ?meltdown,? economist warns

US home builder confidence plummeted 12 points to 55 in July, according to the latest data from the National Association of Home Builders/Wells Fargo Housing Market Index released Monday.

Sentiment has declined for seven straight months and is now at its lowest level since May 2020 ? with more trouble potentially ahead for homeowners.

?Homebuilders have been in denial about the extent of the drop in demand, despite mortgage applications falling by more than a quarter over the first half of the year, with no end in sight to the decline,? said Ian Shepherdson, chief economist at Pantheon Macroeconomics. ?Now, they are acknowledging reality.?

?Pretty soon, anyone who has bought a home in recent months will be sitting on a loss,? Shepherdson added.
https://nypost.com/2022/07/19/us-housing-market-could-be-headed-for-meltdown-economist/

 

[irvinehomeowner]

"Ooo look... now I'm right and everyone is agreeing with me!"

Hilarious.

 

[usctrojancpa]

Six months ago, my views on housing were considered extreme.  Now even mainstream economists agree with me.

US housing market could be headed for ?meltdown,? economist warns

US home builder confidence plummeted 12 points to 55 in July, according to the latest data from the National Association of Home Builders/Wells Fargo Housing Market Index released Monday.

Sentiment has declined for seven straight months and is now at its lowest level since May 2020 ? with more trouble potentially ahead for homeowners.

?Homebuilders have been in denial about the extent of the drop in demand, despite mortgage applications falling by more than a quarter over the first half of the year, with no end in sight to the decline,? said Ian Shepherdson, chief economist at Pantheon Macroeconomics. ?Now, they are acknowledging reality.?

?Pretty soon, anyone who has bought a home in recent months will be sitting on a loss,? Shepherdson added.
https://nypost.com/2022/07/19/us-housing-market-could-be-headed-for-meltdown-economist/

Aren't those the same guys who predicted that prices would be up 10%+ in 2022 earlier this year?

 

[trematix]

Are you really quoting the Post? LOL.

Six months ago, my views on housing were considered extreme.  Now even mainstream economists agree with me.

US housing market could be headed for ?meltdown,? economist warns

US home builder confidence plummeted 12 points to 55 in July, according to the latest data from the National Association of Home Builders/Wells Fargo Housing Market Index released Monday.

Sentiment has declined for seven straight months and is now at its lowest level since May 2020 ? with more trouble potentially ahead for homeowners.

?Homebuilders have been in denial about the extent of the drop in demand, despite mortgage applications falling by more than a quarter over the first half of the year, with no end in sight to the decline,? said Ian Shepherdson, chief economist at Pantheon Macroeconomics. ?Now, they are acknowledging reality.?

?Pretty soon, anyone who has bought a home in recent months will be sitting on a loss,? Shepherdson added.
https://nypost.com/2022/07/19/us-housing-market-could-be-headed-for-meltdown-economist/

 

[Liar Loan]

?Pretty soon, anyone who has bought a home in recent months will be sitting on a loss,? Shepherdson added.

Aren't those the same guys who predicted that prices would be up 10%+ in 2022 earlier this year?

These are the same guys that called the housing bubble in 2005.

He Saw Trouble Coming. Now He Sees It Going.
Nov. 6, 2010

But positive indicators can and do disappoint, so I decided to consult an expert on these matters: Ian Shepherdson, chief United States economist at High Frequency Economics. As a reader of economic tea leaves over the last five turbulent years, Mr. Shepherdson has a darn good record. For instance, unlike the throng of economists who failed to see the housing crisis coming, Mr. Shepherdson warned his clients in fall 2005 that real estate would crash and a recession would ensue.
https://www.nytimes.com/2010/11/07/business/07gret.html

The Five Financial Gurus You Can Still Trust
Jul. 14, 2017

1) Ian Shepherdson Ian Shepherdson anticipated the sharp decline in the U.S. housing market earlier than most. Back in 2005, for instance, he argued that the U.S. housing bubble was starting to hiss badly. He correctly forecast that the housing decline would have wide-ranging ramifications for the economy and the housing market.
https://www.thedailybeast.com/the-five-financial-gurus-you-can-still-trust