All Encompassing Mortgage and Real Estate Thread

[LCHorn 2749]

3 hours ago, Dbeasy said:

These massive insurance price increases push down real estate prices. If it doesn’t get under control soon, we have a serious serious problem.

Not sure I agree with this one, either.  I think the rise in insurance cost will be changing the cost/benefit in certain areas but Austin should be a winner there compared to Houston (hurricanes) and Dallas (the enormous sucking due to proximity to Oklahoma).

Also, I’m not seeing any health insurers struggling to make a profit.  
 

3 hours ago, Dbeasy said:

1. Elon - he will single handedly lift Central Texas real estate over the next 10 years.

Be honest, you drive a Cybertruck, right? 😉

[UTPhil2006 3909]

Houston insurance (especially the coastal counties) has definitely jumped 

[Dbeasy 15526]

59 minutes ago, horn4life said:

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?

 

 

24 minutes ago, LCHorn said:

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

I come out of high tech management and Austin historically had been a weak tech location as compared to other areas around the country. Dallas actually for many years had better tech than Austin, believe it or not. But then in the 2000's+ Austin really started to get much more solid in tech. Part of the reason for this was the creation of new VC funds in Austin after Austin Ventures imploded.  Plus, Austin got discovered as being hip due to SXSW, etc.  So, the tech industry here has really started to become a solid, but still behind the bay area, and spots on the East Coast. The long-term outlook is very good.

If you dig into tech here a bit deeper, it's still driven today quite a bit by being the 2nd/3rd/4th location for tech companies on the west coast. They setup here as a lower cost location to supplement other higher cost centers. Some of those cost advances are waning. When recessions hit, 2nd locations are always hit harder. Whenever I went thru a recession over the years, I'd always cut other locations ahead of key, prime locations, for many reasons. Austin actually has never seen what a recession will do to it because of tech, because the tech industry here didn't get strong enough until after the last recession in 2008. People don't know what's coming, if we do hit a hard recession. Now of course the activity by Apple and Elon will blunt the impact, but even they will put the brakes on activity during a recession.

The surrounding suburbs will also feel it. You'd be amazed at how many tech industry workers live in Buda, Leander, etc. The State government and University will also limit the damage obviously.

 

15 minutes ago, LCHorn said:

Not sure I agree with this one, either.  I think the rise in insurance cost will be changing the cost/benefit in certain areas but Austin should be a winner there compared to Houston (hurricanes) and Dallas (the enormous sucking due to proximity to Oklahoma).

Also, I’m not seeing any health insurers struggling to make a profit.  
 

Be honest, you drive a Cybertruck, right? 😉

I can't talk personally to the health insurers but got off the phone yesterday with a health insurance broker who told me the whole industry is in complete turmoil.  I could go into more detail on the conversation, but you can google it. They are making money because they all raised rates dramatically.  The fear is that costs are spiraliing out of control so fast they may keep having to do it.

I can't stand Elon Musk. I think the Cybertruck is the dumbest vehicle created in history.  But, you have to acknowledge when the world's richest man wants to spend a lot of money in your city and build a lot of businesses.  If you look at the history of cities around the country, many of them were "made" by one or a few key companies or people.  For example, Portland was made by Nike, Tektronix and a few other companies. Elon's impact here, if he doesn't waver, will be substantial over time.

[jimmyjazz 46972]

43 minutes ago, LCHorn said:

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

I thought the same thing, I guess it depends on the definition of "tech".  I work in a technology realm but it is very hardware oriented -- steel, copper, magnets.  We are likely much more susceptible to economic pressures related to a reduction of imported goods, etc. than the average social media company.

[horn4life 3829]

Interesting takes bay all - Interesting to consider the "satellite location" aspect of a tech downturn.  I was thinking more related to the super elevated valuations in the NASDAQ effecting tech more, and that housing markets that rise highest, tend to pull back the most percentage wise.  

The one thing I will say that if I were advising anyone, especially younger folks without kids, is look CAREFULLY at school districts when buying.  Simply as I remember the RE crash and it was fascinating to see the houses hold their value better, and turn more often in the better school districts.  If I am looking at two very similar houses, the ISD might be the deciding factor.  It's not a huge thing, but when you need to sell in a tough market you need every edge you can get.  And even in shitty markets parents are willing to spend a little more to get their kids a better education.  IMHO.