All Encompassing Mortgage and Real Estate Thread

[UTPhil2006 3930]

4 minutes ago, Gil Bang said:

I know how you think.

[Wulaw Horn 19579]

Jobs report revised upwards from last month (12k and that number was nonsense low bc of strikes and hurricanes) and best expectations by 45k. 
and yet- MBS are up a little bit. 
no idea why. Will be interested to read analysis on reports unless someone here can tell me what the deal is right now. 
At airport and not super plugged in.  

[UTPhil2006 3930]

27 minutes ago, Wulaw Horn said:

Jobs report revised upwards from last month (12k and that number was nonsense low bc of strikes and hurricanes) and best expectations by 45k. 
and yet- MBS are up a little bit. 
no idea why. Will be interested to read analysis on reports unless someone here can tell me what the deal is right now. 
At airport and not super plugged in.  

They have razors at the duty free shop just saying. 😜. 
 

But yeah jobs came in higher but in that sweet spot where the 10 year is down .03 so far finally breaking through the 4.15 number we kept shying away from since the beginning of October. 

[gurt 796]

I'm gonna need you to cut off that left hand collar...

[UT_OB1 2266]

You also should update your weight loss thread

[Wulaw Horn 19579]

5 minutes ago, UT_OB1 said:

You also should update your weight loss thread

Will find it. 189.4 today. Got to 180 and decided that was too skinny so stopped doing cardio and started eating chips and ice cream to get to and maintain the 190. 

[Gil Bang 26229]

On 12/6/2024 at 6:07 AM, Wulaw Horn said:

Jobs report revised upwards from last month (12k and that number was nonsense low bc of strikes and hurricanes) and best expectations by 45k. 
and yet- MBS are up a little bit. 
no idea why. Will be interested to read analysis on reports unless someone here can tell me what the deal is right now. 
At airport and not super plugged in.  

I lost track of your story.  Just how not fat are you these days?

[Muny_Tex 315]

Doing some Redfin browsing, and came across an interesting market/pricing anecdote today.

Mid-tier, minimally updated South Austin home on a large/functional/nice-looking 0.5 acre lot.  

Price history shows it listed for $615k back in May 2020, went under contract only 4 days later (presumably for over-ask based on that era).

Came on the market this week for $595k, by all accounts in good/equivalent condition as before (including a brand-new HVAC).

How many of us would have predicted cumulative price depreciation of -5% (or more) 4 years ago?  

 

[jimmyjazz 47099]

5% price depreciation from 2020 would be gold in Austin right now.  I think most valuations are down ~ 20% or so.

[Muny_Tex 315]

^^Versus the 2021/early 2022 peak boom (or I guess bubble?), yes.....But Spring of '20 was still pretty calm while folks were reacting to the initial shock + gauging their personal level of impact, IIRC.  I bought a place in Brentwood during Fall '20 and bid for several others in Central/West in '21....it was massively different climate w.r.t. price action + competition.

My takeaway is that we're pretty much "back to normal" on most pricing now relative to pre-Covid in a lot of areas (78746 will probably remain a permanent outlier)....Except rates are still 2.0-3.0% higher than 2019 which I think still spells some trouble unless conditions improve quickly.  Same point I made about condos few posts/pages ago, just interesting to see same trend reflected in SFH now as well.

 

 

Edited December 9 by Muny_Tex

[UTPhil2006 3930]

Honestly looks appropriately priced for inside/location/lot size. Maybe they don't have the means but I would have sat on that another couple years. 

[Wulaw Horn 19579]

55 minutes ago, UTPhil2006 said:

Honestly looks appropriately priced for inside/location/lot size. Maybe they don't have the means but I would have sat on that another couple years. 

At the rate they should have on that it ought to, if not cash flow, at least not lose money. Absolutely sit on that shit. 

9 hours ago, Gil Bang said:

I lost track of your story.  Just how not fat are you these days?

320 to 190. 6’1 and change. 

[UTPhil2006 3930]

30 minutes ago, Wulaw Horn said:

320 to 190. 6’1 and change

Almost literally 

[jimmyjazz 47099]

12 hours ago, Muny_Tex said:

^^Versus the 2021/early 2022 peak boom (or I guess bubble?), yes.....But Spring of '20 was still pretty calm

Yeah, I think I wasn't remembering the timing of peak frenzy.

[Incredulity 11873]

On 12/6/2024 at 11:47 AM, Wulaw Horn said:

so stopped doing cardio

[swraith 348]

Is this video overly negative with its views on the current state of the market?

 

[LCHorn 2750]

21 minutes ago, swraith said:

Is this video overly negative with its views on the current state of the market?

 

Turning it off after about two minutes and the third exaggeration.  First off, fuck DR Horton.  Second, when a builder includes incentives it’s not taking less in profit-it’s built into the sales price.  
 

Considering the video appears to have been published three weeks ago and DR Horton’s stock is about the same as then ($157 a share!), it doesn’t look like the market is expecting some cataclysmic result.  

[Dbeasy 15561]

I saw an Austin market price trend line a few weeks ago from ~2010 to now. There was a bump in the price trend line in 2021-2022, but now prices are back in line with that trend line. I don’t feel like Austin prices will get much worse/lower unless we go into a recession. 

Even if inflation spikes again, I’m not clear whether prices would suffer because land is a hard asset. 

[UTPhil2006 3930]

10 hours ago, LCHorn said:

Turning it off after about two minutes and the third exaggeration.  First off, fuck DR Horton.  Second, when a builder includes incentives it’s not taking less in profit-it’s built into the sales price.  
 

Considering the video appears to have been published three weeks ago and DR Horton’s stock is about the same as then ($157 a share!), it doesn’t look like the market is expecting some cataclysmic result.  

With builders I always use the same analogy/example since it's usually younger borrowers thinking they're getting a steal. I tell them put their arm out straight. If they're offering an incentive over here (price, rate, flooring, etc) I push their hand down and their elbow goes up. If they're moving something down over here they're moving something up over here. They're not in the business of giving away money. Usually they'll get me on rate because they tie incentives into it and the contract so a few times I'll still win it but more often than not I basically just say go ahead and close with them, make your 6 payments and call me and I'll refinance you. 

[horn4life 3838]

if you are a builder you simply must either turn inventory, or stop building.  Not a whole lot of in between.  I didn't look at the video because in this market nobody is dropping their pants 50%.   But empty completed homes also have carrying costs, and at what point do larger builders feel the necessity to cut margin if the homes are not turning?  The guys who usually get fucked if the market tanks are the small builders.  They hesitate and don't get out even at a small loss, then the carrying costs eat them up, and they sell an even larger loss. Or worse, the bank calls their loan, and they get wiped out.  I think we are a long fucking way away from any builders losing money any time soon.  Of course there are some dumb motherfuckers out there, so I am sure some builder if screwing up out there.

 

 

[Muny_Tex 315]

5 hours ago, Dbeasy said:

 I don’t feel like Austin prices will get much worse/lower unless we go into a recession. 

There are currently 500+ homes for sale with Austin addresses listed between $600k - $1.1M

--368 of those homes have been on the market more than 30 days

--276 of those homes have been on the market more than 60 days

--200 of those homes have been on the market more than 90 days

Seems to me there are a lot of people clinging to hope of swift and significant rate improvement; otherwise it's gonna be very steep drop once these sellers finally capitulate. 

I personally think the AUS bear case runs much deeper (regardless of rate conditions), because the main drivers of the 15+ year boom (affordability, quality of life, weather, adults in charge) are basically all massive losing propositions now. 

If you can afford to insulate yourself in Westlake (or I guess parts of Lake Travis), then yeah good for you...otherwise I think the cachet train has run almost entirely out of steam in Austin-proper.  

[MAUFRAIS 6739]

The one I want to know about is Gossett Homes in Tarrytown. They are gigantic, expensive, and appear to be vacant.

[LCHorn 2750]

1 hour ago, horn4life said:

if you are a builder you simply must either turn inventory, or stop building.  Not a whole lot of in between.  I didn't look at the video because in this market nobody is dropping their pants 50%.   But empty completed homes also have carrying costs, and at what point do larger builders feel the necessity to cut margin if the homes are not turning?  The guys who usually get fucked if the market tanks are the small builders.  They hesitate and don't get out even at a small loss, then the carrying costs eat them up, and they sell an even larger loss. Or worse, the bank calls their loan, and they get wiped out.  I think we are a long fucking way away from any builders losing money any time soon.  Of course there are some dumb motherfuckers out there, so I am sure some builder if screwing up out there.

 

 

You raise a good point and here's some corroboration.  I was exchanging emails the other day with one of the commercial banks to whom we send borrowers for interim constructions loans and they are tapped out.  Not because they've got too many home owner borrowers, but because they are also a provider of loans to smaller builders in Austin and they aren't able to move their inventory (bear in mind these are predominately infill spec builds $1.5m+ zips like 78704, so not your usual DR Horton buyer).  The bank doesn't want the houses so they renew the loans. 

[LCHorn 2750]

1 hour ago, Muny_Tex said:

If you can afford to insulate yourself in Westlake (or I guess parts of Lake Travis), then yeah good for you...otherwise I think the cachet train has run almost entirely out of steam in Austin-proper.  

Anecdotal, but I know some small builders who aren't able to move their $2.5m+ West Lake homes, either. 

All of this is rate related and property tax related. 

[Hefeweizen 5443]

1 hour ago, MAUFRAIS said:

The one I want to know about is Gossett Homes in Tarrytown. They are gigantic, expensive, and appear to be vacant.

I’m decently plugged in to the market and have never heard of them.  Interesting.

[LCHorn 2750]

10 minutes ago, Hefeweizen said:

I’m decently plugged in to the market and have never heard of them.  Interesting.

Same, I never would have thought “As goes Gossett, goes Tarrytown.”  
 

I don’t want to say this out loud and wish it into existence, but I do think affordability at all price points, along with the loss of luster of Austin post-pandemic is not great for future growth.  
 

I think some of it is that is tied to Texas in general; you just can’t be this unfriendly (to women, to minorities, to just application of the law) and not have that impact immigration, particularly among high wage earners with the most employment mobility.
 

I don’t think our addition of Instagram celebrities and life coaches makes up for it, either.  
 

Anyway, wanted to add that after I blamed rates and admit that not’s all of it.  
 

[Wulaw Horn 19579]

44 minutes ago, LCHorn said:

Same, I never would have thought “As goes Gossett, goes Tarrytown.”  
 

I don’t want to say this out loud and wish it into existence, but I do think affordability at all price points, along with the loss of luster of Austin post-pandemic is not great for future growth.  
 

I think some of it is that is tied to Texas in general; you just can’t be this unfriendly (to women, to minorities, to just application of the law) and not have that impact immigration, particularly among high wage earners with the most employment mobility.
 

I don’t think our addition of Instagram celebrities and life coaches makes up for it, either.  
 

Anyway, wanted to add that after I blamed rates and admit that not’s all of it.  
 

Wait, what?  Do you think that we are going to see net migration out of Texas and out of Austin b/c (State) politics are too conservative?  

I will go ahead and put whatever amount on the opposite of that proposition as you want to.  Texas will be a net migration winner for my entire lifetime (and I'm a man- I'm 46 damn it) I would bet lots of money on.  It's the trend and has been since the creation of air conditioning. 

Edited December 11 by Wulaw Horn

[Hefeweizen 5443]

10 minutes ago, Wulaw Horn said:

Wait, what?  Do you think that we are going to see net migration out of Texas and out of Austin b/c (State) politics are too conservative?  

I will go ahead and put whatever amount on the opposite of that proposition as you want to.  Texas will be a net migration winner for my entire lifetime (and I'm a man- I'm 46 damn it) I would bet lots of money on.  It's the trend and has been since the creation of air conditioning. 

I agree completely.  I don’t think it’ll change for about another 20 years probably.  When the water situation gets fucked enough (it’s on its way) it’ll start reversing.

[LCHorn 2750]

8 minutes ago, Wulaw Horn said:

Texas will be a net migration winner for my entire lifetime

I’m talking about Tarrytown and similarly priced ranged Austin buyers.  Three years ago there was tons of people leaving elsewhere and buying in the most desirable neighborhoods in town.  That’s stopped or suffered such a deterioration in demand that it’s impossible to ignore.  
 

I’m not sure how I feel about Austin itself-there’s a very real affordability problem living here that is remedied simply by moving a few miles down the road.  People on the Reddit “AustinFood” group, for example, aren’t talking about how they can get good meals for cheap anymore, they are talking about how it was cheaper to eat in NYC.  Austin MSA will be fine but that’s not helping AISD fund their campuses with declining enrollment.  

[Muny_Tex 315]

The bear case against Austin (especially as a family destination) is much different than Texas statewide.  We will need to swing over to Cloak Room to spell out the details (and I'd certainly prefer not), but surrendering downtown (and many valued spaces) to violent bums/junkies and turning public safety into an ideological debate instead of a core imperative is a good place to start.  

[horn4life 3838]

19 hours ago, Muny_Tex said:

There are currently 500+ homes for sale with Austin addresses listed between $600k - $1.1M

--368 of those homes have been on the market more than 30 days

--276 of those homes have been on the market more than 60 days

--200 of those homes have been on the market more than 90 days

Seems to me there are a lot of people clinging to hope of swift and significant rate improvement; otherwise it's gonna be very steep drop once these sellers finally capitulate. 

I personally think the AUS bear case runs much deeper (regardless of rate conditions), because the main drivers of the 15+ year boom (affordability, quality of life, weather, adults in charge) are basically all massive losing propositions now. 

If you can afford to insulate yourself in Westlake (or I guess parts of Lake Travis), then yeah good for you...otherwise I think the cachet train has run almost entirely out of steam in Austin-proper.  

I have been saying for the last couple years that a LOT of the listings were simply, "maybe I can get this silly number?"  Houses sitting 90 days without regular price reductions are NOT homes that NEED to be sold.  They are houses that will ONLY be sold at a price that the marketplace will not currently support.  "But two years ago..." will be the words out of the sellers mouth, when justifying their silly price.  They are not IMHO true listings.  I don't know what you call a listing that is never going to sell at the listing price, but there is a shit ton of this is Austin.  

16 hours ago, Muny_Tex said:

The bear case against Austin (especially as a family destination) is much different than Texas statewide.  We will need to swing over to Cloak Room to spell out the details (and I'd certainly prefer not), but surrendering downtown (and many valued spaces) to violent bums/junkies and turning public safety into an ideological debate instead of a core imperative is a good place to start.  

About the only bear case in Downtown Austin is commercial real estate due to flexible work changing the landscape.  Hell right now they pretty much sell the majority of their downtown condos before they even top out the building.  So despite the homelessness issue, those very pricy units have been moving very quickly especially in presale.  I will say that you are seeing some capitulation in downtown condo resales.  Simply as if you need to sell, price capitulation is you only ally unfortunately.

I did a quick "condo 2/2" search and zoomed in on the greater downtown area.  And indeed I found the fuck up builder! Hogan ave Unit B  Hogan Ave Unit A. not really downtown, but it popped up on my condo search.  I do think that Austin is cooling to some degree after being white hot for a decade.  But I also think that the love of Austin has run into the reality of 100 degree plus days all Summer.  But overall tech is still in charge in Austin, hell Apple hasn't even finished it's monster campus up North.

I am not sure what "family destination" means, but Dirty Sixth probably would not be on my list.  But I see shit tons of tourist families every time I go see music on SOCO.  But Austin is indeed a pricy, family destination, but homelessness is probably not a determining factor at all. Unless you really, really want to take you kids to Casino El Camino, on a Saturday night. But I can say the same for any downtown urban area.   The difference is Austin probably has more high end housing infill, than any other city in Texas.  Hell I am having a hard time finding a similar marketplace with that sort of infill? Help me out here?

[Storm the Field 5366]

I hope none of you are a flashy pair of twins, their brother, or their cousin operating out of Miami.

Quote

 

Three brothers from Miami Beach who rocketed to fame through the sale of luxury real estate from Miami to Manhattan were taken into custody by Miami FBI agents and local police Wednesday morning and charged with a slew of state and federal sex trafficking and rape crimes.

Twins Oren and Alon Alexander, 37, and their older brother Tal, 38, were awakened at their Miami Beach homes by police and investigators from the Miami-Dade State Attorney’s Office and the FBI, read their rights and hauled away in handcuffs

Ultimately, the three brothers are expected to be transferred to New York City, where the federal indictment was filed by the U.S. District Court for the Southern District of New York, the same court that recently indicted rap mogul Diddy. A cousin of the Alexander brothers named Ohad Fisherman is also facing rape charges.

 

 

[UTPhil2006 3930]

Damn the older brother got the raw end of the deal on hair and ears 

[horn4life 3838]

2 hours ago, UTPhil2006 said:

Damn the older brother got the raw end of the deal on hair and ears 

If they are hung according to their tie length, the older bro is at least winning that contest.  But the fucking three different lengths of ties cracks me up.  Bro #1, is channeling Homer Simpson on his tie length...

[troph 25172]

how bad is the property insurance market?  we have a concrete house, metal roof, there's ZERO burn to the ground risk here. tornados, nope. hurricanes not close enough. hail not really, plus willing to go to a 2% deductible. sit on top of a hill, flood risk is zero. fire risk generally in the area, sure but again concrete house it's not going anywhere in a fire. but we are having a terrible time even getting a quote. reasons - fire line, total value, total roof square footage.

premium went from $8K to $14K and no one else will quote it.

 

wtf?

[Orale 1178]

10 minutes ago, troph said:

how bad is the property insurance market?  we have a concrete house, metal roof, there's ZERO burn to the ground risk here. tornados, nope. hurricanes not close enough. hail not really, plus willing to go to a 2% deductible. sit on top of a hill, flood risk is zero. fire risk generally in the area, sure but again concrete house it's not going anywhere in a fire. but we are having a terrible time even getting a quote. reasons - fire line, total value, total roof square footage.

premium went from $8K to $14K and no one else will quote it.

 

wtf?

Do you need coverage because of lender requirements? I have a commercial property that's similar, basically a concrete bunker that's fully sprinklered etc... We're selling a different property and will pay off the note on this property. Once that occurs we're only carrying liability coverage as the property coverage is for our lender. Our property coverage deductible is so high that we'd be out of pocket anyways for any damage short of a catastrophic event. 

[troph 25172]

1 hour ago, Orale said:

Do you need coverage because of lender requirements? I have a commercial property that's similar, basically a concrete bunker that's fully sprinklered etc... We're selling a different property and will pay off the note on this property. Once that occurs we're only carrying liability coverage as the property coverage is for our lender. Our property coverage deductible is so high that we'd be out of pocket anyways for any damage short of a catastrophic event. 

yes lender coverage. our home is the safest insurance risk there is, nope, don't care. buttfuck without lube or just flat out not interested.

[Goofyboy 3431]

how bad is the property insurance market?  we have a concrete house, metal roof, there's ZERO burn to the ground risk here. tornados, nope. hurricanes not close enough. hail not really, plus willing to go to a 2% deductible. sit on top of a hill, flood risk is zero. fire risk generally in the area, sure but again concrete house it's not going anywhere in a fire. but we are having a terrible time even getting a quote. reasons - fire line, total value, total roof square footage.
premium went from $8K to $14K and no one else will quote it.
 
wtf?

Ours went from $4200 last year to $6400 this year. I’m thinking a whole lot of folks aren’t expecting a couple thousand increase or more on their insurance.

[Wulaw Horn 19579]

Mine went from 2200 to 5100. That was fun. 

[troph 25172]

$4k to $8k to $13k …

Looks like fiddy percent is normal. Jesus Christ talk about the great enshitification. 

[Muny_Tex 315]

@trophIf you're in that situation based on "total value" I can only imagine the horrors of your property tax.  At least you're rich?

 

Edited December 12 by Muny_Tex

[UT_OB1 2266]

When do we get another rate cut?

[UTPhil2006 3930]

12 minutes ago, UT_OB1 said:

When do we get another rate cut?

Will be announced next week, at least a 96% chance of such last I saw 

[Wulaw Horn 19579]

59 minutes ago, UT_OB1 said:

When do we get another rate cut?

Last rate cut of 50 bips the national average for mortgage rates went from 6.1 to 7.1 over the next 30 days. That was fun. 

[LCHorn 2750]

5 hours ago, Wulaw Horn said:

Last rate cut of 50 bips the national average for mortgage rates went from 6.1 to 7.1 over the next 30 days. That was fun. 

This-I wouldn’t want to start wishing for the opposite but clearly the market isn’t taking the lead from the Fed at the moments. 

[Mother mopar 3381]

12 hours ago, troph said:

how bad is the property insurance market?  we have a concrete house, metal roof, there's ZERO burn to the ground risk here. tornados, nope. hurricanes not close enough. hail not really, plus willing to go to a 2% deductible. sit on top of a hill, flood risk is zero. fire risk generally in the area, sure but again concrete house it's not going anywhere in a fire. but we are having a terrible time even getting a quote. reasons - fire line, total value, total roof square footage.

premium went from $8K to $14K and no one else will quote it.

 

wtf?

That's a Tuesday in Florida. 

[UTPhil2006 3930]

2 hours ago, Mother mopar said:

That's a Tuesday in Florida. 

Sad but true. It's not a mass exodus by any means, but a good chunk of people are leaving Florida bc of insurability, affordability, etc 

[Dbeasy 15561]

The Austin market is complicated. There are multiple conflicting trends:

Downward Trends

1. Hiring, layoffs - stalled across most tech companies. This has slowed migration here.

2. Current prices - as someone mentioned, listings are still clinging to 2022 prices in some cases and just sitting. Listings that adjust sell ok.

3. Water - a lack of it could stop progress in its tracks  

4. Recession - a bad recession will disproportionately hit Austin very hard because of tech here.  

 5. Failing Insurance Industries - the price increases are stunning, yet health and property insurers have still been struggling to make a profit. These massive insurance price increases push down real estate prices. If it doesn’t get under control soon, we have a serious serious problem. As my insurance friend always says, the world runs on the back of insurance and when it’s screwed up the economy gets screwed up. 

Upward Trends

1. Elon - he will single handedly lift Central Texas real estate over the next 10 years. He will move so many businesses here, it will produce significant real estate price increases.

2. Apple - as long as Apple doesn’t cancel their facility here, it will produce a very significant increase in employment and surrounding effects. 

3. Trend lines and Comparative Prices - trend lines are okay and Austin prices are still inline with or attractive compared to other high employment areas of the country. 

Desirability of Austin is neutral at this point because of politics and current prices. 

So my thinking is that we could see some short term pain but the longer term trends are fine as long as the issues above get resolved. 

[horn4life 3838]

2 hours ago, Dbeasy said:

4. Recession - a bad recession will disproportionately hit Austin very hard because of tech here.  

Honestly I hadn't really thought about a more weighted downturn in Austin because of tech.  I guess I have lived here so long I don't even really think of it as a "class" as it's so much of the Austin landscape.  But if Austin falls... What about all the ticks that have been sucking on the big dog, like Buda, Cedar Park/Leander, Georgetown? Are their markets not also largely dependent on tech's rise or fall?

 

2 hours ago, Dbeasy said:

3. Water - a lack of it could stop progress in its tracks  

IT's a huge issue in the Corpus Area.  There is actually a lot of development about to happen on the Island that is going to change the landscape completely.  The water supply there just fell below 20%.  That's not a lot of leeway for error.   The state should have been building desalination plants years ago for the area, when they started putting big money into dredging the channel and the bridge boondoggle that was going to bring a lot of employment.  People need to drink water.  And industry as a whole need reliable affordable water sources.

 

[LCHorn 2750]

3 hours ago, Dbeasy said:

4. Recession - a bad recession will disproportionately hit Austin very hard because of tech here.

Not sure I agree with this one (in that a recession hurts tech worse than other industries)-care to elaborate?