Economy The great housing market crash of 2022

[heloder]

he signed an executive order on day 1 of his presidency to stop drilling on federal land. How is that not directly affecting the cost of oil and gas? lol

Hey you should post a link to that Executive Order.

...

What's the matter? Can't find it?

That's because you're full of shit. Joe Biden has never signed an EO to stop drilling on federal land. Not his first day or any day since.

So why are you lying about it?

He did sign an EO that temporarily halted new leases on Federal land, but that had no effect on the millions of acres that the oil industry already has drilling leases for (that they're sitting on). Furthermore, the Biden Administration has approved more drilling leases on Federal land than Trump did his first year. And yet you claim that's the reason oil prices worldwide have skyrocketed.

So again, why are you lying about it?

 

[west42]

I get it man. I have been critical of the GOP more the the democrats. But yea, just curious how they could fix things.

A big one would be regarding gas prices. From what I've been able to research yes the government is leasing out a lot of land and permits for oil drilling but the fact that they are very much against petroleum doesn't give the oil producers incentive to actually increase production. Also there's been a huge difficulty in transportation. Not being able to build pipelines as affected distribution and they can drill the oil but they have difficulties transporting it to refineries

 

[badascan]

I read an article earlier this year that said to meet next year's additional demand for Grand Rapids MI, there will need to be something like 5300 addition units... That's some serious demand. 5300 on top of what is usually bought and/or rented annually... Where the fuck will those come from? There are building projects here and there for 100 units and 50 units... It's crazy...

 

[MeatheadMike]

You're right, because mortgage companies are working with home owners to prevent foreclosures.

As for the rest, everyone can make a prediction and you and I have made ours. Now let's see what happens.

Edit, home loans drop.
https://www.msn.com/en-us/money/rea...es-fall-amid-rising-mortgage-rates/ar-AAWEoJ1

Interest rates have basically doubled in the past few months, but according to that link, pending home sales have only dropped 1.2%. It also says that contract signings actually rose 4% in my area (the North East). To me this isn't an indication of any impending crash, if anything its even more proof that prices are probably just going to keep going up and buyers like myself are fucked.

 

[Rygu]

If it wasn't huge corporations buying up so many houses I might believe a crash is coming.

But it is, so it won't. Prices might come down a bit but there's no crash coming.

 

[deadon]

Interest rates have basically doubled in the past few months, but according to that link, pending home sales have only dropped 1.2%. It also says that contract signings actually rose 4% in my area (the North East). To me this isn't an indication of any impending crash, if anything its even more proof that prices are probably just going to keep going up and buyers like myself are fucked.

Naw you'll be good. The market will crash just watch. You can't keep squeezing people they only have so much money. Something will have to give. If rates go up prices will have to drop. Just like when the rates dropped and prices jumped up. You have more purching power.

We'll see what happens.

 

[cottagecheesefan]

Can't take what's happening in NY seriously though. I was reading about prices in NY dropping under half of what the rent used to be before Covid. I could see a lot of young dumb people moving in during that time now having to move back out once the land lords raised the rent back up to what it used to be.

Yea, I thought New York might be a bad example because they have a trend of people leaving the state as well as having some of thr strictest mandates, which I have commented on a lot, kills small business and leads to drops in commercial real estate, property taxes, local revenue, jobs, etc.

I posted some more info with other states.cities after that tho, and yes other areas are having an increase... but the place that surprised me, which is pretty disconcerting was Texas (Dallas, Forth Worth, and Austin), that are now having spikes. People migjht argue it is just coming back to prepandemic numbers, but this was one of the areas that was supposed to be defying the narrative, having lots of people with good salaries move into the area, along with businesses, some of the most minimal covid restrictions, etc.

I talked about this with @MMAisGod in this thread cause we both live in FL, which also fits that trend set.

**side note**
I find this headline interesting because it highlights this. Keep in mind that I comment on FL a lot, and even in the various Disney threads (wastelanded or not) and my Desantis thread, I am happy to indicate FL is not Alabama without Disney. So this article just shows that the wealthiest people in New York are fleeing and moving to conservative areas, mainly Florida, to West Palm Beach, where Mar-A-Lago is lol.

https://www.bloomberg.com/news/feat...-city-s-richest-1-converge-on-west-palm-beach
**end side note**

Anyways, this shows that even in a booming area like TX, this is happening, which is indicating that the inflation is much more systemic than people have been presenting it. And now all the lag behind is starting to catch up. As me and others have pointed out... Oil, which powers and transports the economy is more than double what it was under Trump.

Along with several other factors like shutdowns, etc, that COVID brought on, now this conflict in Europe, massive spending now goingt to that, supply chains affected by sanctions and the dollar losing value because of dangerous economic moves that are back firing by every measure.

I mean, the purpose of this thread is not just to highlight this incoming market crash, but also the perfect storm of multiple trends. Just Ukraine for example, with 2008 Market crash, another factor was the massive bill we had been printing money for in Afghanistan and Iraq, and didn't we just leave 85 billion there (just in military equipment)? How much money was thrown at that country and now unaccountable for with the Taliban taking over and top officials/bureaucrats and such we installed leaving with tens of millions stuffed in suitcases. Which also floods the market.... that is with raytheon happy to have this proxy war and rearming of NATO.

Is it no coincidence Ukraine is considered a very corrupt country, with literally the son of the president. Like are people really that blind to simple facts to see this? Remember, Joe Biden is one of the big uniparty collaborators who supported going to Iraq ad Afghanistan. How much money did we spend in those conflicts by NGOs funded by LIZ CHENEY, which I also love to argue about.

 

[Halifax]

I don't worry about the stock market fluctuations either because whatever I invest is long term.
Homes are different than regular investments though. Your home not only affects all aspects of your every day life, but also determines aspects of your kids lives as well such as where they go to school and what path they will have in their lives. If you have a pregnant wife and/or a kid thats ready to start school you cant just say "oh well investment conditions aren't favorable so I'll just stay in my apartment for a few more years".

The fact that the prices of single family homes can have huge market swings due to so many external factors (interest rates, real estate investors etc) is a huge problem imo. People who currently own homes and are settled in will never understand how truly miserable and depressing this situation is for buyers.

Not true.

I own a home. I'm settled in with a comfortable rate for the next 9 and a half years because I saw this shitstorm coming a mile away and remortgaged on a fixed 10 year. And a paid half as much for my house as homes in my neighborhood now go for. The ones who bought a 500k home here at 2.1% in the last 2 years are shitting kittens now when their mortgage comes up because in canada you don't get a 20 year or 25 year rate. You usually get 5 and then renegotiate based on current rates when your term is up. Those who bought a 500k at 2.1% fixed see the writing on the wall in 3 or 4 years. They currently pay $2100 a month at 2.1% with property tax included. A 5 year fixed is around 4% now due to the new swings. If it goes to 6% or 7 their monthly payment bumps to $3100 to $3300 a month. Asking anyone to come up with an extra $1000 a month when 67% of Canadians live paycheck to paycheck is insane.

And I have been screaming that this is coming for years because we have a fiscally irresponsible government who prints money and gives it to other countries like its worthless. A ham sandwich with an inkling of economics could see how badly this was going to turn out.

Christ when Harper was PM folks rages when house prices went up 4% some years. Under Trudeau house prices regularly went up 27 to 37%. Some places literally cost triple what they did in 2015 now. The house across the street from me was sold in 2019 for $250k and sold in 2021 for $450k(or so)

 

[deadon]

Yeah that new 3k payment on top of everything else going up. I have no idea why people can't understand this.

One of my good friends bought in 06 and I tried to warn him over and over again what was coming. He ignored me and got some ARM loan. Yeah they lost the house when shit hit the fan. He did live payment free in that home for two years but had a BIG tax bill when it was all over.
I dont think people want to see what's coming. They know BUT they don't want to know.
Shoot I know guys that I fish with that have 1000.00 a month boat payments for 20 years. Going to be a lot of good stuff for sell soon. To fill my boat it's 200.00. It would really suck if I didn't outright buy my boat.

 

[MeatheadMike]

Not true.

I own a home. I'm settled in with a comfortable rate for the next 9 and a half years because I saw this shitstorm coming a mile away and remortgaged on a fixed 10 year. And a paid half as much for my house as homes in my neighborhood now go for. The ones who bought a 500k home here at 2.1% in the last 2 years are shitting kittens now when their mortgage comes up because in canada you don't get a 20 year or 25 year rate. You usually get 5 and then renegotiate based on current rates when your term is up. Those who bought a 500k at 2.1% fixed see the writing on the wall in 3 or 4 years. They currently pay $2100 a month at 2.1% with property tax included. A 5 year fixed is around 4% now due to the new swings. If it goes to 6% or 7 their monthly payment bumps to $3100 to $3300 a month. Asking anyone to come up with an extra $1000 a month when 67% of Canadians live paycheck to paycheck is insane.

And I have been screaming that this is coming for years because we have a fiscally irresponsible government who prints money and gives it to other countries like its worthless. A ham sandwich with an inkling of economics could see how badly this was going to turn out.

Christ when Harper was PM folks rages when house prices went up 4% some years. Under Trudeau house prices regularly went up 27 to 37%. Some places literally cost triple what they did in 2015 now. The house across the street from me was sold in 2019 for $250k and sold in 2021 for $450k(or so)

Yea I'm not fully familiar with the current status of the Canadian housing market, so I can only comment on the situation in the US. Here the mortgage rates fluctuate on a daily basis but once you lock in a fixed rate, it won't change for 30 years unless you decide to refinance.

These ridiculous price increases are all because of COVID. People saved more money during lockdowns, people want more space to work from home, and interest rates were slashed to the lowest in US history to keep the economy going. Perfect storm to jack up all these prices

 

[Halifax]

Yea I'm not fully familiar with the current status of the Canadian housing market, so I can only comment on the situation in the US. Here the mortgage rates fluctuate on a daily basis but once you lock in a fixed rate, it won't change for 30 years unless you decide to refinance.

These ridiculous price increases are all because of COVID. People saved more money during lockdowns, people want more space to work from home, and interest rates were slashed to the lowest in US history to keep the economy going. Perfect storm to jack up all these prices

Canada housing costs a lot more than the US. And our Dollar is worth less. Its been on a steep uphill trajectory even before COVID.

Mortgage rates fluctuate here too. Some folks play the variable mortgage game and remortgage every few years. Its typical to do 1, 3 or 5 year Mortgages here on a 25 year amortization period. 10 years are rare. I decided to go with a 10 year renewal at 2.9% 6 months ago at these record low rates(Costs $1210 a month or so). Cost me $50 more a month than I paid on a 5 year at 2.5% ($1159) at the time and the bank (and my inlaws) tried to talk me out of it and to take 5 years at 2.1% ($1110 a month) but I was bullheaded. Best decision I ever made. if I waited and made the same decision right now I would be paying $300 a month more at 4.19%

Rates are heading for 7% or worse in the next few years. If I took the 2.1% for 5 years, yeah i would have paid $1110 a month for 5 years. then the next 5, if the rates go where i think they go at 7% I would have been forced to pay $1750 a month.


its worse in bigger cities like Hongcouver and Toronto. Check these pre COVID numbers
https://www.cbc.ca/news/business/house-prices-affordability-income-1.4966211

imagine if 79 to 88% of your income went to just squeaking by owning a house

Also to put in perspective, the big cities in Canada like Toronto and Vancouver all cost money on par with or more than houses in Manhattan in new York city

 

[12ga.]

One of my neighbors sold their house for about $540k a week ago. They only had it up for sale for 8 days before it sold. These all are new construction houses in my community and was bought in 2020 for $390k. I'm not seeing a crash happening, in Florida at least.

Floridia is a little different. We have mass boomers retiring right now,with cash, and Florida is where its at. Plus a Blue state exodus. I dont see Florida as a bubble. Most other places are bubbling

 

[MeatheadMike]

Canada housing costs a lot more than the US. And our Dollar is worth less. Its been on a steep uphill trajectory even before COVID.

Mortgage rates fluctuate here too. Some folks play the variable mortgage game and remortgage every few years. Its typical to do 1, 3 or 5 year Mortgages here on a 25 year amortization period. 10 years are rare. I decided to go with a 10 year renewal at 2.9% 6 months ago at these record low rates(Costs $1210 a month or so). Cost me $50 more a month than I paid on a 5 year at 2.5% ($1159) at the time and the bank (and my inlaws) tried to talk me out of it and to take 5 years at 2.1% ($1110 a month) but I was bullheaded. Best decision I ever made. if I waited and made the same decision right now I would be paying $300 a month more at 4.19%

Rates are heading for 7% or worse in the next few years. If I took the 2.1% for 5 years, yeah i would have paid $1110 a month for 5 years. then the next 5, if the rates go where i think they go at 7% I would have been forced to pay $1750 a month.


its worse in bigger cities like Hongcouver and Toronto. Check these pre COVID numbers
https://www.cbc.ca/news/business/house-prices-affordability-income-1.4966211

imagine if 79 to 88% of your income went to just squeaking by owning a house

Also to put in perspective, the big cities in Canada like Toronto and Vancouver all cost money on par with or more than houses in Manhattan in new York city

Not so sure housing Canada costs more than the US.... maybe certain regions. But where I live (suburbs of NY), I can expect to pay around $900K-$1.1M for a 2000sq ft house (built in the 1950s or earlier) with $20K+/per year taxes. Pre-Covid it would have been maybe around $700-$800K.

It looks like Mortgage rates in Canada are quite lower than the US, but having to renegotiate it during its term makes it more complicated. Not sure what's better. Anyway sounds like you made the right call.

 

[koquerelle]

They will benefit from this housing crash as they can then go in and buy up the houses and then rent them

Come on. The big players don't give a fuck about renting houses. Look at the last housing market crash.

 

[koquerelle]

it’s so funny watching people turn to republicans to “help ordinary people.”


It’s like you simpletons have been asleep the last 40 years.


Any minute now cutting taxes for America’s highest earners will eventually work. Any minute now.

It's just as funny to look at retards who think the other side cares about them.

 

[aerius]

Not so sure housing Canada costs more than the US.... maybe certain regions. But where I live (suburbs of NY), I can expect to pay around $900K-$1.1M for a 2000sq ft house (built in the 1950s or earlier) with $20K+/per year taxes. Pre-Covid it would have been maybe around $700-$800K.

It looks like Mortgage rates in Canada are quite lower than the US, but having to renegotiate it during its term makes it more complicated. Not sure what's better. Anyway sounds like you made the right call.

I'm on the outskirts of Toronto, a million bucks Canadian ($800k US) might get me a 1000 square foot home with no garage. Property tax is less than a third of what you guys are paying, but that's probably not going to last for too much longer.

With regards to mortgages, biggest difference is that pretty much all our mortgages are full recourse loans which means the lender will ass fuck you hard if you try to do a strategic default like many did in the US back in 2008. Most people don't know this, which is why a bunch of folks are in for a rectal reaming if they default or try to jingle mail their keys.

 

[Rockapotomuss]

Prices went up with low interest rates and a massive push for more space due to lockdowns.

Now we have high interest rates coming with less restrictions. It follows that prices will fall because it's more expensive to borrow and there's less value in private space when you can use public spaces again.

 

[MeatheadMike]

Prices went up with low interest rates and a massive push for more space due to lockdowns.

Now we have high interest rates coming with less restrictions. It follows that prices will fall because it's more expensive to borrow and there's less value in private space when you can use public spaces again.

This is logical, and exactly my thinking last year which caused me not to be as aggressive in my search.... The problem is I underestimated how many buyers there were and the shortage of available houses. Also work from home (at least partial) is here to stay forever.

The result is this years hike in the interest rates has done very little to calm things down, and if anything its increased desperation making it even more chaotic. Properties in my area worth a damn are gone in a matter of days, bidding wars are still rampant and home prices just keep going up with no end to this in site.

 

[Halifax]

This is logical, and exactly my thinking last year which caused me not to be as aggressive in my search.... The problem is I underestimated how many buyers there were and the shortage of available houses. Also work from home (at least partial) is here to stay forever.

The result is this years hike in the interest rates has done very little to calm things down, and if anything its increased desperation making it even more chaotic. Properties in my area worth a damn are gone in a matter of days, bidding wars are still rampant and home prices just keep going up with no end to this in site.

With the amount of inflation we are facing up here, we may need a Volcker shock if it keeps going

 

[Rockapotomuss]

This is logical, and exactly my thinking last year which caused me not to be as aggressive in my search.... The problem is I underestimated how many buyers there were and the shortage of available houses. Also work from home (at least partial) is here to stay forever.

The result is this years hike in the interest rates has done very little to calm things down, and if anything its increased desperation making it even more chaotic. Properties in my area worth a damn are gone in a matter of days, bidding wars are still rampant and home prices just keep going up with no end to this in site.

There is a lot of pent up demand and interest rates have barely gone up. There are six more fed meetings this year where rates are expected to rise at each. Scarcity and time limits both lead to desperation which is why we still see buyers. These are emotions though and they will get slaughtered. Q1 GDP was negative and layoffs have barely even started yet.

Work from home doesn’t work, it’s a day off.

The baby boomers who own most houses, and even multiple houses each, will need to sell as their income earning capacity goes to 0 and their debt servicing costs rise.

People think investors will save the market. It’s the opposite. If everyone who owned homes lived in them and there were no investors, then no one would sell because where would they go? Investors though don’t need the home if it’s losing money.

Just wait.