All Encompassing Mortgage and Real Estate Thread

[UTPhil2006 3,806]

18 hours ago, Wulaw Horn said:

Rates from yesterday.  We had a good morning today but gave it all back after the 10 year auction came in weak.  Market anxiously awaits inflation report tomorrow.  Looking for a big number (like a jump to 8.8 is what my wizards of smart suggested) tomorrow so anything that's just a terrible 8.5% or something would cause rates to drop, as crazy as that sounds.  

9.1%

[Neonmoon 38,129]

Rent does not save you money. You will never get rent back. You get principal (equity) back. Assuming 20% down on a 500K house, and your $2500 rent scenario. I also added $14 in renters insurance per month and $100 per month for pet fees at rental unit. 

 

Here are the differences by interest rate. 

Yes, as rates go up, your monthly payment goes up, and your earn less equity, but it's still greater than zero. If you are renting for a year, that's $31,368 you're never going to see again. At 6%, that's $4,912.02 of equity you get to keep. (which goes up each year as your home appreciates)

I'm fully aware it's been the "worst" in a decade, but 2020 was the bottom of the entire history of interest rates. 

 

I'm not here to make money off any of you. I'm licensed in NC, FL, TN, SC. (Not Texas). I just am trying to explain the realties of the situation and help you make the best financial decision.

There are two issues at play. Supply/Demand and Inflation, and no matter how you slice it, it you wait to buy a house, you are worse off than buying a house now. Let me explain. 

Quick Summary in Spoiler

Spoiler

There is a supply issue. There are not enough houses to meet the demand. This would normally make houses prices go up. Now, you factor in the pandemic and the Fed lowering interest rates to encourage people to spend money to boost the economy. This also increased demand. More demand = higher house prices = inflation. The prices are inflated because there is more demand than supply. Too much inflation is bad, therefore to curb the inflation, the Federal Reserve has to curb demand (the reason for high prices). To do that, they have to raise interest rates, because as shown above, higher interest rates means higher payments, less people can afford to buy a house, and therefore there is less demand.

So if you wait to buy a house when houses prices go down, there is a reason they are going down, it's because interest rates are going up, and you will be able to afford less house. People are incorrectly assuming that house prices are going down because the market is naturally balancing. It is not. They are going down because interest rates are going up. 

 

[StruggleBus 3,922]

Yeah I don't think anyone is arguing that renting is better. I'm currently in the wait and see mode on upgrading to a house in the 3400 sqft range. But we already own a home. 

[closetohumping 17,437]

38 minutes ago, StruggleBus said:

Yeah I don't think anyone is arguing that renting is better. I'm currently in the wait and see mode on upgrading to a house in the 3400 sqft range. But we already own a home. 

Ditto.  I'm going to try to encourage my kids to buy asap.

[Wulaw Horn 19,068]

50 minutes ago, StruggleBus said:

Yeah I don't think anyone is arguing that renting is better. I'm currently in the wait and see mode on upgrading to a house in the 3400 sqft range. But we already own a home. 

 

11 minutes ago, closetohumping said:

Ditto.  I'm going to try to encourage my kids to buy asap.

So, owning a house and waiting on an upgrade is less harmful than choosing to not buy and own a house. If appreciation goes up then the price your home will sell for will also go up, so it's not likely that you get locked out of the market in the same way that someone who doesn't own will.  It's important to plant your flag in homeonwership as a hedge against inflation and rising prices.  Once that's been done the tide will lift your boat along with all the other owners in your area.  I know that you know this, but there are lots of people I'm sure who read this that aren't homeowners or in the market.

[closetohumping 17,437]

4 minutes ago, Wulaw Horn said:

 

So, owning a house and waiting on an upgrade is less harmful than choosing to not buy and own a house. If appreciation goes up then the price your home will sell for will also go up, so it's not likely that you get locked out of the market in the same way that someone who doesn't own will.  It's important to plant your flag in homeonwership as a hedge against inflation and rising prices.  Once that's been done the tide will lift your boat along with all the other owners in your area.  I know that you know this, but there are lots of people I'm sure who read this that aren't homeowners or in the market.

Correct.  My only regret is not buying sooner but I was a knucklehead and my life was pretty mobile. That's why I will try to help my kids.  

The reason I bought is you know, thirty years from now, hopefully I'm still around, but if I'm not, it's something to leave for my kids.  They won't have to take a shit job to pay their mortgage if we have a family home. 

 

I'm still considering selling/buying but just want to slow it down a hair.  I'm looking at more of a downgrade for now.  Have some solid equity, may cash that in and move to a less pricey market.  Then, buy rental property.  And blow.

Edited July 13, 2022 by closetohumping

[Neonmoon 38,129]

ugh 6%-10% if you are renting. Renters are getting fucked. 

[royiv 9,276]

19 hours ago, Mach 1 said:

I’m developing a townhouse project in Phoenix and here now (and sweating my balls off).

Broker was kicking ass on presales and we’re only halfway through framing. He was working on 8 contracts when rates started increasing  - he’s now working on zero.

Seems as if most buyers are in a wait and see mode, which is understandable and fine with me since we won’t be finished until April 23. My hope is whatever rate increase tops out before and some stability comes back wherever it ends up.

Phoenix still appears to be an attractive market with job growth, so fingers crossed. We can weather a 10-20% decline in value and still do fine. After that we’ll be revisiting 2010.

Inventory is skyrocketing in Phoenix right now. I'm also seeing lots and lots of price reductions. I would be awfully nervous if I was developing a residential project in that market.

[StruggleBus 3,922]

48 minutes ago, royiv said:

Inventory is skyrocketing in Phoenix right now. I'm also seeing lots and lots of price reductions. I would be awfully nervous if I was developing a residential project in that market.

Is inventory rising simply because homes are staying on the market longer?

[closetohumping 17,437]

5 hours ago, StruggleBus said:

Is inventory rising simply because homes are staying on the market longer?

Or smaller buyer pool?

[Mach 1 1,677]

^^^

Both IMO. Shouldn’t be unexpected as we had a big run up in appreciation so buyers felt pressure to act fast and possibly overpay. Rate increases and the threat of recession bullhorned has made would be buyers hit the pause button, or priced them out of what they were looking for. Inventory that would normally be taken off the market is now not, so comparatively to the recent past the total number is increasing. Sellers are apparently realizing they shot too high on the ask and are lowering it, as they should.

As a developer I think it’s healthy and we need a recalibration - values in many markets have gotten way ahead of themselves. I like stability so the proforma I give the construction lender ends up within a plus/minus 10% of what I give them. That ain’t the case right now, both from a cost and sales perspective. But we’re making it work.

As noted numerous times we have a housing shortage, so there are many buyers, but IMO they’re looking for dust to settle on the rates, and reductions, as they should. Market stability. It will be interesting to see the dance between builders/sellers and buyers in the coming months.

Where those three things meet is the question.  If I were delivering product soon I’d be nervous, but I’m almost a year out, I think shit sorts itself out by then.

Edited July 14, 2022 by Mach 1

[closetohumping 17,437]

1 hour ago, Mach 1 said:

^^^

Both IMO. Shouldn’t be unexpected as we had a big run up in appreciation so buyers felt pressure to act fast and possibly overpay. Rate increases and the threat of recession bullhorned has made would be buyers hit the pause button, or priced them out of what they were looking for. Inventory that would normally be taken off the market is now not, so comparatively to the recent past the total number is increasing. Sellers are apparently realizing they shot too high on the ask and are lowering it, as they should.

As a developer I think it’s healthy and we need a recalibration - values in many markets have gotten way ahead of themselves. I like stability so the proforma I give the construction lender ends up within a plus/minus 10% of what I give them. That ain’t the case right now, both from a cost and sales perspective. But we’re making it work.

As noted numerous times we have a housing shortage, so there are many buyers, but IMO they’re looking for dust to settle on the rates, and reductions, as they should. Market stability. It will be interesting to see the dance between builders/sellers and buyers in the coming months.

Where those three things meet is the question.  If I were delivering product soon I’d be nervous, but I’m almost a year out, I think shit sorts itself out by then.

Message me the builds?

[Neonmoon 38,129]

Why do down markets bring the crazies out?

[jimmyjazz 45,895]

Leasing question (TX):  my daughter & 3 friends are trying to lease a house just north of the UT-Austin campus.  They each need guarantors.  However, the documentation the parents (guarantors) need to fill out seems to imply that every guarantor is wholly responsible for the entire amount of the lease through the leasing period.  That seems nuts.  Is it standard?  I'm happy to guarantee her cut (~ $675 per month for ~ 11 month duration), but the whole thing?  

[ChickenSandwich 9,830]

Was like that when I went to school as well. They are renting a house, not a room to an individual. Also why student renters can be a terrible idea. 

[Pato del Muerto 52,487]

Well my sainted mother is supposed to close on her first house purchase on Wednesday.  Loan is not ctc and the final inspection was just sent in on Friday. I’ve tried explaining to her the timeline and that she needs to push hard to get docs out on Monday so that if there’s a problem, there’s a day to make changes. 
 

she checked out on me and my questions not long after her conditional approval so I don’t know much about her loan. But it’s a new build and there shouldn’t be any rate lock issues, so if closing does push it wouldn’t kill the deal, just mess up all of the logistics that she had set up for closing and moving. 
 

i am just glad she is going to finally be a home owner and has gotten out of the renter mindset, even at the possible penalty of buying at the top of the price surge and the top of the rate increase. 

[jimmyjazz 45,895]

34 minutes ago, ChickenSandwich said:

Was like that when I went to school as well. They are renting a house, not a room to an individual. Also why student renters can be a terrible idea. 

My daughter lived in a west campus apartment this school year and I only had to guarantee her personal rent.

[ChickenSandwich 9,830]

apples/west campus apartment

oranges/private owned rental home

But now she is trying to rent a house, from a private landlord (with no income) that you will guarantee, but only 1/4. 
 

It becomes a hassle for the landlord at some point, thus making alternate renters a better option. 

Edited July 17, 2022 by ChickenSandwich

[PhillyD 1,257]

1 hour ago, jimmyjazz said:

Leasing question (TX):  my daughter & 3 friends are trying to lease a house just north of the UT-Austin campus.  They each need guarantors.  However, the documentation the parents (guarantors) need to fill out seems to imply that every guarantor is wholly responsible for the entire amount of the lease through the leasing period.  That seems nuts.  Is it standard?  I'm happy to guarantee her cut (~ $675 per month for ~ 11 month duration), but the whole thing?  

I'm a landlord.  On my lease, every person on the lease is responsible for the entirety of the rent.  That includes a guarantor if a guarantor is required. 

I have no interest I chasing down individuals for pieces.  

[jimmyjazz 45,895]

The realtor told us to put a special exception where allowed on the guarantor's agreement.  We're all doing it.  We'll see if it flies.

[Wulaw Horn 19,068]

You should buy her a house. She becomes a non occupant co-borrower so you can do minimum down payment and keep the house and rent it out forever. 

[pronghorn 44]

what is a range of interest rate for home line of credit? house value $4m with no mortgage so assume want to deploy $2m line of credit.

want to take equity out to buy a second home / rental unit.

[jimmyjazz 45,895]

10 hours ago, Wulaw Horn said:

You should buy her a house. She becomes a non occupant co-borrower so you can do minimum down payment and keep the house and rent it out forever. 

Landlord accepted the amended TAR documents.  Whether they hold water legally is not for me to say, and I hope I don't have to find out, but all 4 families added the language that they only guarantee their fraction of the monthly lease for the duration of the contract.

More importantly, I have somewhere to park on game days.

[Dbeasy 15,042]

41 minutes ago, jimmyjazz said:

Landlord accepted the amended TAR documents.  Whether they hold water legally is not for me to say, and I hope I don't have to find out, but all 4 families added the language that they only guarantee their fraction of the monthly lease for the duration of the contract.

More importantly, I have somewhere to park on game days.

Who provided the language for the special provisions? The real estate agent?

[jimmyjazz 45,895]

3 minutes ago, Dbeasy said:

Who provided the language for the special provisions? The real estate agent?

LOL, no, it was a little more home-grown.  Me.

The process was worth it in the sense that all four families agreed (verbally) that they'd cover their kid regardless of whether they moved out.  Is that legally binding? No, but the kids are pretty tight, so I'm just gonna go with it.  She has to live somewhere.

[Mother mopar 3,318]

LOL, no, it was a little more home-grown.  Me.
The process was worth it in the sense that all four families agreed (verbally) that they'd cover their kid regardless of whether they moved out.  Is that legally binding? No, but the kids are pretty tight, so I'm just gonna go with it.  She has to live somewhere.

So a gentlemen's agreement

[UTPhil2006 3,806]

10 hours ago, pronghorn said:

what is a range of interest rate for home line of credit? house value $4m with no mortgage so assume want to deploy $2m line of credit.

want to take equity out to buy a second home / rental unit.

Texas or Oregon?

[Wulaw Horn 19,068]

10 hours ago, pronghorn said:

what is a range of interest rate for home line of credit? house value $4m with no mortgage so assume want to deploy $2m line of credit.

want to take equity out to buy a second home / rental unit.

Can you post what you find out on this?  Be very interested both in a where (that’s a lot of money for a HELOC- I know for example I’ve had people tell me UFCU has a 300k type limit) you find that will do that deal and what terms. 
We don’t do HELOC but I like to have something to tell my people as an alternative option. 

[Serak The Preparer 3,431]

On 7/13/2022 at 6:54 AM, Neonmoon said:

Yes, as rates go up, your monthly payment goes up, and your earn less equity, but it's still greater than zero. If you are renting for a year, that's $31,368 you're never going to see again. At 6%, that's $4,912.02 of equity you get to keep. (which goes up each year as your home appreciates)

...

I just am trying to explain the realties of the situation and help you make the best financial decision.

Not just singling you out but I've seen this similar sentiment on this thread and others. I do believe that for most people, if they can afford to buy then it is a good decision. But I also think it is a bit disingenuous to say "help you make the best financial decision" when you don't include home repair (both $ and time costs) that are avoided by renting as well as employment / quality of life flexibility from renting. Moving sucks and I would be thrilled if I never moved again but if I had to, there is less risk in renting than owning.

I totally understand that your post is not would you would necessarily say to an actual client but if I had a realtor / mortgage broker/ advisor ignore the benefits of renting when showing the advantages of equity, I would consider that person a bullshit artist.

[Wulaw Horn 19,068]

6 minutes ago, Serak The Preparer said:

Not just singling you out but I've seen this similar sentiment on this thread and others. I do believe that for most people, if they can afford to buy then it is a good decision. But I also think it is a bit disingenuous to say "help you make the best financial decision" when you don't include home repair (both $ and time costs) that are avoided by renting as well as employment / quality of life flexibility from renting. Moving sucks and I would be thrilled if I never moved again but if I had to, there is less risk in renting than owning.

I totally understand that your post is not would you would necessarily say to an actual client but if I had a realtor / mortgage broker/ advisor ignore the benefits of renting when showing the advantages of equity, I would consider that person a bullshit artist.

The equity that you get in paying down a 30 year mortgage in years 1 and 2, for example, is just very very minor and not worth talking about in comparing to rent… the equity play is in getting in to the house and not missing out on appreciation that’s been running 5-20% lately. 
If appreciation stops going up (it hasn’t lately- but who knows- maybe we’ve hit a plateau) then you aren’t missing out by not buying. That’s obviously a pretty big if. 

[Neonmoon 38,129]

4 minutes ago, Serak The Preparer said:

Not just singling you out but I've seen this similar sentiment on this thread and others. I do believe that for most people, if they can afford to buy then it is a good decision. But I also think it is a bit disingenuous to say "help you make the best financial decision" when you don't include home repair (both $ and time costs) that are avoided by renting as well as employment / quality of life flexibility from renting. Moving sucks and I would be thrilled if I never moved again but if I had to, there is less risk in renting than owning.

I totally understand that your post is not would you would necessarily say to an actual client but if I had a realtor / mortgage broker/ advisor ignore the benefits of renting when showing the advantages of equity, I would consider that person a bullshit artist.

Of course, there are different scenarios where renting could be more beneficial to a particular client depending on their unique situation, and I would advise accordingly. You stated "for most people, if they can afford to buy then it is a good decision", so you can agree to my general conclusion, but then accuse me of being "disingenuous" for not speaking to specific scenarios. 

That doesn't seem fair. 

[Serak The Preparer 3,431]

Just now, Neonmoon said:

Of course, there are different scenarios where renting could be more beneficial to a particular client depending on their unique situation, and I would advise accordingly. You stated "for most people, if they can afford to buy then it is a good decision", so you can agree to my general conclusion, but then accuse me of being "disingenuous" for not speaking to specific scenarios. 

That doesn't seem fair. 

Disingenuous may have been too harsh but even in general situations, whenever I see anyone list only pros of one decision while not acknowledging there are cons (even if the pros significantly outweigh the cons), it makes my Spidey sense tingle. I also don't think the flexibility of moving or home repairs are even specific factors. Those apply to all rent / buy decisions. Now the overall weighting of each factor will 100% vary based on specifics, but they (should be) part of a general framework.

Most importantly, I replied to your post just as it was one of the most recent but I certainly wasn't trying to call you out personally or professionally as I know your post isn't the same as a 1:1 conversation. 

[Wulaw Horn 19,068]

2 minutes ago, Serak The Preparer said:

Disingenuous may have been too harsh but even in general situations, whenever I see anyone list only pros of one decision while not acknowledging there are cons (even if the pros significantly outweigh the cons), it makes my Spidey sense tingle. I also don't think the flexibility of moving or home repairs are even specific factors. Those apply to all rent / buy decisions. Now the overall weighting of each factor will 100% vary based on specifics, but they (should be) part of a general framework.

Most importantly, I replied to your post just as it was one of the most recent but I certainly wasn't trying to call you out personally or professionally as I know your post isn't the same as a 1:1 conversation. 

I think your general point is sound though. When I talk to a buyer that’s like- I’m only going to be here 2 or 3 years I always tell them about the risks with ownership- a 2 or 3 year time window in a house isn’t an investment- it’s a risk- like the real estate version of day trading. If there is no investment component to ownership then renting becomes at least as attractive as owning. 

[jimmyjazz 45,895]

Eh.  3 years of 15% annual increase in value -- the latest environment, not historical -- is an "investment", particularly given the leverage associated with a 20% down payment.

That's a 52% increase in value, which is a 3.6X increase in equity, not accounting for a minor reduction of principal.  Subtract seller's fees and (sometimes) capital gains, and it's still a helluva investment.

 

[Wulaw Horn 19,068]

1 hour ago, jimmyjazz said:

Eh.  3 years of 15% annual increase in value -- the latest environment, not historical -- is an "investment", particularly given the leverage associated with a 20% down payment.

That's a 52% increase in value, which is a 3.6X increase in equity, not accounting for a minor reduction of principal.  Subtract seller's fees and (sometimes) capital gains, and it's still a helluva investment.

 

You misunderstand what I’m saying. I didn’t say that you can’t make out well owning a home for

3 years (you’d have done tremendously in this market) just that it’s risky AF to buy a home going in with the plan to own less than 3 years. Thus the day trading comment.  You can make lots of money day trading but it doesn’t mean it’s an investment like buying a mutual fund or something. 

[closetohumping 17,437]

4 hours ago, Serak The Preparer said:

Disingenuous may have been too harsh but even in general situations, whenever I see anyone list only pros of one decision while not acknowledging there are cons (even if the pros significantly outweigh the cons), it makes my Spidey sense tingle. I also don't think the flexibility of moving or home repairs are even specific factors. Those apply to all rent / buy decisions. Now the overall weighting of each factor will 100% vary based on specifics, but they (should be) part of a general framework.

Most importantly, I replied to your post just as it was one of the most recent but I certainly wasn't trying to call you out personally or professionally as I know your post isn't the same as a 1:1 conversation. 

Not directed to anyone in this thread but this is where my realtor friends can drive me crazy. When is the best time to buy?  Now.  When is the best time to sell.  Now.

[Neonmoon 38,129]

43 minutes ago, closetohumping said:

Not directed to anyone in this thread but this is where my realtor friends can drive me crazy. When is the best time to buy?  Now.  When is the best time to sell.  Now.

I mean, I hate to be that guy, but that’s not a contradiction because of the time value of money. Money today is worth more than money tomorrow due to it’s earning potential. Now is always the best time to buy/sell. You can start earning equity faster if you buy or use the proceeds from a sale to invest in another earning vehicle if you sell. Obviously you can still increase your equity but not selling and retain flexibility of movement or save on home maintenance by not buying, but that doesn’t disprove the original claim. The best time is always now. 

[closetohumping 17,437]

9 minutes ago, Neonmoon said:

I mean, I hate to be that guy, but that’s not a contradiction because of the time value of money. Money today is worth more than money tomorrow due to it’s earning potential. Now is always the best time to buy/sell. You can start earning equity faster if you buy or use the proceeds from a sale to invest in another earning vehicle if you sell. Obviously you can still increase your equity but not selling and retain flexibility of movement or save on home maintenance by not buying, but that doesn’t disprove the original claim. The best time is always now. 

Ha.  I knew this post was coming and I certainly agree with it.  Touché.  

[pronghorn 44]

9 hours ago, UTPhil2006 said:

Texas or Oregon?

California

[Pato del Muerto 52,487]

And mom’s closing is already pushed. Somehow the lender/broker is the only one that didn’t know the closing got moved up from end of august to this week. 
 

and I find that she locked at 5.5 and is all oh well I can always refinance. 
 

i wish I could move the loan just out of principle, but her considerable leverage is mitigated by the fact that she won’t have a place to live august 1. 

[UTPhil2006 3,806]

13 hours ago, Pato del Muerto said:

And mom’s closing is already pushed. Somehow the lender/broker is the only one that didn’t know the closing got moved up from end of august to this week. 

SMH.  That's a pretty glaring mistake to make.  

[Gil Bang 25,923]

On 7/19/2022 at 7:03 AM, UTPhil2006 said:

SMH.  That's a pretty glaring mistake to make.  

Fault of the buyer's agent IMO.   But, if I were the listing agent, I still would have confirmed that ALL PARTIES were on board with a quicker close.  

[Pato del Muerto 52,487]

8 minutes ago, Gil Bang said:

Fault of the buyer's agent IMO.   But, if I were the listing agent, I still would have confirmed that ALL PARTIES were on board with a quicker close.  

She’s CTC now and closing on Friday. 
 

but to the closing date point- there was an email sent with all parties cc’d. And it was changed weeks ago, not a last minute change.  In June, allowing her to put her 30 day notice in before July. 
 

Builder wanted some runway in the contract in case of supply chain issues, ended up not needing it. 
 

buyers agent and listing agent are from the same office btw. 

[UTPhil2006 3,806]

Glad it worked out!

[Skipper 6,130]

On 7/18/2022 at 3:22 PM, Neonmoon said:

I mean, I hate to be that guy, but that’s not a contradiction because of the time value of money. Money today is worth more than money tomorrow due to it’s earning potential. Now is always the best time to buy/sell. You can start earning equity faster if you buy or use the proceeds from a sale to invest in another earning vehicle if you sell. Obviously you can still increase your equity but not selling and retain flexibility of movement or save on home maintenance by not buying, but that doesn’t disprove the original claim. The best time is always now. 

Tell that to someone who bought in 2005-7 and needed to sell in the next 2-3 years and/or assumed R.E. values would always rise and locked into an ARM.  There is absolutely a risk.  Obviously that risk is smaller if you have a nest egg and longer term ownership horizon.  But some people tend to forget the hundreds of thousands of people that were either materially hit or completely wiped out financially due to selling below purchase price, short sell or foreclosure during the financial crisis.

[Gil Bang 25,923]

1 hour ago, Pato del Muerto said:

She’s CTC now and closing on Friday. 
 

but to the closing date point- there was an email sent with all parties cc’d. And it was changed weeks ago, not a last minute change.  In June, allowing her to put her 30 day notice in before July. 
 

Builder wanted some runway in the contract in case of supply chain issues, ended up not needing it. 
 

buyers agent and listing agent are from the same office btw. 

So, on my deals, within 1 day of acceptance, I do a calendar with all relevant dates; earnest money, contingency removals, Close date, etc.  I get the other agent to initial it, and then I send it to my client, be they buyer or seller.  

As events are added; inspections scheduled, etc, I update the calendar, again send it to the other agent to initial, and send it to my all parties, with the exception of the other agent's client.  By the end of a deal,  the calendar may have been revised/updated a dozen times but nobody can say that they were surprised by anything. 

I probably spend 2-3 hours per deal doing this, but I'd do it for myself anyway, and by sharing it, it tends to keep things running smoothly, and holds everybody accountable. 

[Neonmoon 38,129]

14 hours ago, Skipper said:

Tell that to someone who bought in 2005-7 and needed to sell in the next 2-3 years and/or assumed R.E. values would always rise and locked into an ARM.  There is absolutely a risk.  Obviously that risk is smaller if you have a nest egg and longer term ownership horizon.  But some people tend to forget the hundreds of thousands of people that were either materially hit or completely wiped out financially due to selling below purchase price, short sell or foreclosure during the financial crisis.

Dude….

No one is forgetting the 2008 financial crisis. It’s the reason why there is less risk today in Mortage lending. There is likely a recession coming, but will it cause a real estate collapse? Unlikely. The Great Recession was caused by the real estate bubble, not the other way around. This recession will be caused by high inflation and high interest rates due to monetary policy used to combat the pandemic. 

Of course there is risk. I never said there wasn’t any risk. I just stated why now is alway the best time to buy (generally speaking). You can’t predict black swan events. No one can. The smart people out there think a recession is coming, home prices will cool, and interest rates will go down a little. Could they be wrong and it collapses? Sure. Could inflation spill out of control and interest rates skyrocket? Sure. 
 

 

 

Edited July 21, 2022 by Neonmoon

[UTPhil2006 3,806]

I choose the path where interest rates cool off. Gimme like 4.25 as a happy medium and let’s roll. 

[Gil Bang 25,923]

38 minutes ago, UTPhil2006 said:

I choose the path where interest rates cool off. Gimme like 4.25 as a happy medium and let’s roll. 

I'm a big fan of stable markets.  I don't like hot markets, I don't like cold markets. 

[Wulaw Horn 19,068]

3 minutes ago, Gil Bang said:

I'm a big fan of stable markets.  I don't like hot markets, I don't like cold markets. 

3.75-4.25 interest rates, 3-8 percent appreciation, 3 month supply of inventory. That would be my ideal