When would be next housing Bottom?

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The California Court Company said:
I think the fear and panic has start to spread?mortgage rates jumping, stock market dropping, everyone talking about inflation and recession?.Irvine won?t be immune and price can easily go back to end of 2021 levels.
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If that's the case, then Irvine would still be much higher than 2018 levels. Personally, I also think that Irvine won't drop much lower than end of 2021 levels, maybe a bit lower than that.
 
This is what balance market will looks for. It never meant for housing to go to the moon forever. It need to make a change. The bond market is leading the FED.
 
Thinking Irvine won?t drop much was like thinking AAPL and TSLA not going to drop much.  AAPL and TSLA down about 25% and 40% respectively this year?
 
So far we are getting calls between 25% and 40%?

When will this happen?

I ask because no one will answer.

Just proving the point that timing is not an exact science.

Let's do some bad math:

A 40% drop means anything that is $1.6m in Irvine right now will be $1m later... and if that bottom comes in 5 years... that $1m in today's dollars figuring a 5%/yr avg inflation means that will be around $1.3m in 2027?

So is that what we are expecting? An adjusted drop of about 19% in 5 years?
 

Your San Diego Home Is Worth $100,000 Less: CoreLogic​

With home prices declining, there are fewer listings on the market and fewer sales. According to Redfin, sales in San Diego County were down almost 50% in December compared with the year before. A decrease in sales has also translated into homes being on the market longer. According to Redfin, the median number of days a home was on the market in December was 33 days, which is 21 days longer than a year prior.

www.nbcsandiego.com

Your San Diego Home Is Worth $100,000 Less: CoreLogic

A Goldman Sachs Report found that four American cities, including San Diego, could see home prices decline so fast that we could see a similar housing market crash to 2008.
www.nbcsandiego.com www.nbcsandiego.com
 
I put an offer on this home for my client (all cash) of $1,245,000 or $20,000 over list, we are the back up buyers as the seller got 5 total offers. Market feels like it's in the bottoming process for now....

www.redfin.com

52 Bamboo, Irvine, CA 92620 - 3 beds/3 baths

(CRMLS) For Sale: 3 beds, 3 baths ∙ 2146 sq. ft. ∙ 52 Bamboo, Irvine, CA 92620 ∙ $1,225,000 ∙ MLS# OC23007106 ∙ Welcome to 52 Bamboo, a gorgeous 3-bed plus loft home in the prestigious gated community of N...
www.redfin.com www.redfin.com

The same model closed for $1,250,000 back in April 2022.
 
My feeling is that it's the low level of inventory that is the primary driver in supporting prices then secondarily the 3/4% drop in mortgage rates. If you don't get materially more inventory onto the market, don't expect material price declines. I have a feeling that the bottom will happen sometime Summer/Fall this year because I foresee the Fed cutting rates in 2024/2025 which will bring rates down from today's rates.
 
The Fed will never cut rates again - they need to keep rates high to attract foreign buyers for the massive Treasury issuance coming with the debt ceiling as Fed QE would be inflationary - and Powell still had $2T of MBS he can dump if the housing markets fail to get the hint. Dollar declining, gold soaring - buckle up.

Again, I hope I’m wrong but I have never fought the Fed and I don’t plan to now
 
OCtoSV said:
The Fed will never cut rates again - they need to keep rates high to attract foreign buyers for the massive Treasury issuance coming with the debt ceiling as Fed QE would be inflationary - and Powell still had $2T of MBS he can dump if the housing markets fail to get the hint. Dollar declining, gold soaring - buckle up.

Again, I hope I’m wrong but I have never fought the Fed and I don’t plan to now
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A great quote from one of my favorite Twitter follows:

“A return to froth in housing wont be met with complacency at Eccles. They simply cant take the chance. Forward guidance into the 6's&7's is likely to be seen as hyperbole, so MBS sales or faster UST runoff are likely next steps. When grounding doesnt work, try military school.”
 
OCtoSV said:
The Fed will never cut rates again - they need to keep rates high to attract foreign buyers for the massive Treasury issuance coming with the debt ceiling as Fed QE would be inflationary - and Powell still had $2T of MBS he can dump if the housing markets fail to get the hint. Dollar declining, gold soaring - buckle up.

Again, I hope I’m wrong but I have never fought the Fed and I don’t plan to now
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They will in 2024/2025 as inflation rolls over, their dot plot shows the Fed funds rate stabilizing around 2.50-3% as long as inflation is around 2%. Besides that, the higher they go on the Fed funds rate the lower their push long term bond rates because the market will price in a lower inflation rate in the future because longer term rates are priced off of long term inflation expectations.
 
usctrojancpa said:
They will in 2024/2025 as inflation rolls over, their dot plot shows the Fed funds rate stabilizing around 2.50-3% as long as inflation is around 2%. Besides that, the higher they go on the Fed funds rate the lower their push long term bond rates because the market will price in a lower inflation rate in the future because longer term rates are priced off of long term inflation expectations.
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Which is why they need to start selling their MBS ASAP
 
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