When Will Overbidding on Houses End?
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- čas přidán 16. 07. 2024
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I just turned 40 and finally got my life together. I know my first home will be something small and ugly, but I don’t care lol. I want to do everything the right way. Slow and steady wins the race. I’m thankful I made it this far. I hope everyone who can see this gets to live their dreams.
Congratulations bro! It’s never too late, I’m in my 30s and I have the same goal to buy some type of property at that age. Made alot of financial mistakes when I was younger.
$500k as ENTRY level? What the hell has happened in the past 10 years?
I mean, it depends where you live, but 500k is generally not entry level. If anyone spent an hour on Zillow they'd see you can buy really nice houses for hundreds of thousands cheaper.
Dollar lost 25% of its value in 3 years due to rampant inflation caused by the government...that's one issue. Lack of housing is another.
We are closer to $7k for entry level amymore.
@@BadMannerKorea where
@@reese85 Ohio, all over PA, Texas, Oklahoma, etc. Search at 300k max, they’re all over the place. Spend an hour on there and you’ll see what I’m talking about.
It's heartbreaking how many houses I've missed out on because of being outbid. But at the same time I refuse to go house broke on a large appraisal gap when that money would be better served elsewhere.
Amen. Just rent. It ain't the American dream, but when the roof starts leaking or the AC goes out, renting feels pretty awesome. Either you'll save a big enough nest egg to get a mortgage in your price range regardless of price or house costs will go down (or both!), and at that point you can decide if you'd rather have a house or $150k sitting in your brokerage account ;)
before you feel left out. down the street from me (san diego) someone bought a 3bed 1 bath single story for 800-900k
house was built in 50s. yes it was renovated but honestly how good can it be with one bathroom. when i saw that price i though anyone who pays more than 600k is crazy. 900k is insane
@@bvoyelr i have a paid for house but if i was 15 years younger i would just rent i cant afford the house i live in now it would be over 4000$ a month on a 30 year its stipid
Smart!
I outbid people and bought a house last year. At first I felt good, but then felt like a fool. No other person or investor was dumb enough to pay that much. On the bright side the value has gone up $75k.
My wife and I were just stupid fortunate and blessed when we got our house in 2021. We were outbid by everyone. For months. Until we found an older woman who was a school psychologist and retired. Funny enough - I’m a therapist and my wife is a teacher. So she related to both of us in a way. She ignored a full cash offer she had gotten and said she’d go with our down payment and financing if we signed for the amount she was looking for, which was not unreasonable whatsoever. We are thankful she gave us the opportunity and she literally changed our lives. Now…the home definitely needed some cosmetic upgrades as dark green walls and cigarette laced carpets weren’t what we wanted. 🤣 But we saw through that as its structurally sound, and we renovated by painting and getting some wood laminate floors and new baseboards. Completely different house now! Still some stuff to do to it but we love it and we’re willing to be patient and save money up first to pay for continued renovations in cash. It will definitely take a while, but it will be worth it!
That's an awesome story! I'm hoping more folks won't be greedy upon selling their property. We were lucky as well when buying our 1st: lots of cosmetic issues, neglected yard, etc. But we were grateful they picked our offer over some corporation instead. Sounds like y'all are taking the right steps. Keep up the good work!! 🎉
@@happycamper246do you mean that accepting a cash offer is greedy? Or did you mean something else?
Similar situation. The woman we bought from was unable to leave during showings. We talked to her, showed her our son, and we have another baby coming, and we gave her an extra far out closing date. She took our lower offer because she said we were nice to her and willing to wait for her to be ready to leave.
Cash is not always King, and that's a good thing.
@@SBTiki buy gold lol
Why wasn't corporate home buying mentioned? A lot of corporations are buying up housing for investments, and they can pay what the average Joe can't. These corps are using software to determine/maximize rent prices based on location, demographics, and other factors, and just rake in the cash.
Because corps only own a tiny percentage (13-17% depending on whose numbers you trust) of homes. The rest are owned by investors or homeowners. 63% of Americans own their homes, so clearly the vast majority of homes are NOT owned by corporations. It's just a distraction to get you pissed at Corp America and keep certain politicians in power when they promise to "fight for you!", rather than figuring out how to get your own slice of the pie and ignore the politicians.
Those corporate investments are not doing well.
@@GowthamNatarajanAIyou are right. They can't find renters to pay the price points they need to make their money back. Eventually they will need to cut their losses. Just need the recession/depression to be officially recognized and boom a crash larger than the GFC. People are hurting a lot more now than they were in the months/years prior to the GFC. This market cycle is gonna be very ugly.
Why aren’t you a shareholder of those companies?
Blackrock dividends pay all of my monthly utilities and groceries for my beach condo.
@@blackworldtraveler3711 because by the time I entered the workforce they were $500+ per share and I was 80k in debt making 39k a year. Now they are about $800 a share and although I am out of debt now I'd rather be saving that money for a down payment on a house and getting my money out of Fiat for when the everything bubble bursts and the dollar collapses.
In Colorado Springs, houses are sitting for months, and most have multiple price decreases before they're finally sold. It's changing in some of the more overpriced areas, finally.
That’s what I was wondering when this was recorded? Two years ago. Things are slowing down a lot
Same here in Central Texas, no one is jumping in to pay the ridiculous prices seller's want
In SF Bay Area, lots of homes definitely go well over asking. I've seen good $2 million homes go 300k over asking and if a home is priced under 500k its go over asking because those homes rarely exist and everyone wants one. Someone is still spending here regardless of the so-called mass exodus that is happening in CA.
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I chuckle as someone who has lived in the same home for 20 years, I would not want to pay what the market will now bear for my home but thats the market and if I should sell, I will sell for market value.
The flip side is, I have to live somewhere, so if I sell mine and buy something else I will pay a high price for that whether I agree or not.
Bought mine for 120k eighteen years ago. Now worth 210k. 😊
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Your 100% correct man!
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This lady needs to understand that she is competing with people who have WAY more money than her. Dave got it right: high earners can now live almost anywhere. When you leave a place like California, you have no problem throwing down an extra $50K on a house bid in Pennsylvania.
Your argument is flawed my friend. She’s in Philadelphia. People aren’t leaving California to go to Philadelphia. It has nothing to do with higher earners going to other markets and prices. Such a fallacy
@@mtbokor1969 I think he meant people can now work remotely.
2009-2019 was also great bull run in stocks and real estate appreciation.
I rode both with my investments including the beach home and two rentals a bought with cash in 2008 after housing crash. Slammed down $20k extra to knock all the buyers out of my way when buying my beach home.
Sold my two rentals last year and now have over $600k of new cash after taxes in savings added to most of the rent profits I stockpiled since 2010.
@@mtbokor1969 Whatever the migration pattern is, she's dealing with people that are willing to spend more than her. It's as simple as that.
Higher earner prob won’t make the same money in another state if they just up and leave
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Scam
It's definitely alarming to hear about a default cycle, especially in the context of the housing market. Defaults can lead to foreclosures, and that has a cascading effect on the overall real estate landscape.
While it's concerning, it's important to look at the broader economic context. A default cycle doesn't necessarily mean the housing market is completely finished; it might signal challenges, but markets are dynamic, and they can recover.
But if more people are defaulting on their mortgages, doesn't that mean home values could plummet?
Yes, that's a possibility. An increase in foreclosures can lead to an oversupply of homes in the market, putting downward pressure on prices. It's the basic principle of supply and demand.
How can people address concerns about their property values?❤❤❤
Now might be an ideal moment to reevaluate your financial status. If you're worried about your home's value, consulting a real estate professional or financial advisor could be beneficial.
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Where I am, they build mansion type homes or luxury apartments. Nothing for the middle class, so we are all fighting for the already built middle class home. Wisconsin here.
was just looking up there to relocate its hard to find any homes built after 1940 in the 250k , all are going for 20 over asking, rough.
@@St34mPunkPrivateer yes, bought mine in 2018. 1930s home for 75000. It is now worth 170000. Anything newer than that are between 200 and 300,000 for a city lot. No yard and 1 car garages sometimes less than that.
There's plenty of livable homes in Wisconsin for only 150k, just have to lower your standards a bit 🙄 😒
@@joeplem5329
Yup.
People are their own worse enemy financially with homes.
It is impossible to make money building starter homes. To build a very basic home costs about $250 per square foot to build including garage and any covered porches. So a 1000 square foot home with a 300 square feet for a small garage and porch is going to cost 325k to build. Assuming the lot is worth 100k and you have a 425k house but you are still getting a very basic tiny home that no one wants to pay that much. Thus you can only make money building luxury or high end homes.
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Spam
Yup I’ve been say that but my family thinks I’m crazy
Bro didn’t even mention private equity outbidding the hell out of everyone lol! Nice one Dave!
This
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It's so good to hear that we are not alone in this house buying struggle
I bought 6 years ago at the perfect time. Low interest, priced decently. Now, homes almost identical to mine in the same street have sold for $150k more than what I bought, and that's with the original crappy kitchen and bathrooms. My house has the updated kitchen the developer offered and remade master bedroom. I'm not letting this house go for anything.
Houses in your area have only gone up $150k in six years? That's unusual.
House didn't actually go up at all. The dollars you claim as the value just lost value therefore you need more of them th buy the same House. How could a house actually go up in value. And it's not supply and demand. There are plenty to buy it's just we don't all have $500k to buy one.
@@pm2886 it is not unusual if they were $150-200k houses.
@@chrishart8548 you sound young and ignorant about markets Chris.
Inflation since covid doesn't explain everything.
@@jamisojo $150k? A broken down shack in the middle of nowhere is $150k where I live.
What God has for you, is for you no one can take that away. I wouldn’t stress about it; those just weren’t the places for you.
Tell that to those that got the gas chamber in nazi germany
Dave is right again. I sold my 4 acres 6 years after buying it without improvements for almost 3 times what I paid. Pro for me, negative for other buyers in the area as the property values after this increased significantly. Even my realtor didn’t think I’d get it, but I knew the market was blowing up where I was selling. It was literally an investment property. Land is gold now!
I’ve concluded that if i want to buy a $500,000 home I’ll need to first save up $150,000 (minimum) in cash. I’m currently renting while paying off the remaining $90,000 I have in debt.
I would want : 20% down $100k + $5k for fees/whatver + $25 for basic move-in repairs/maintenance/updates (unless it’s new construction) + $10k for furnishing/misc + $10k for things you didn’t foresee you needed = $150k sounds about right.
By that time, the $500k house going to be $750k+
@@drjsantos15able then I’ll need to save up $200,000.
I've saved up more than this with zero debt and I am not going anywhere near this market right now. I'm in the low to mid 400 range for a primary home. I have a rule of thumb that if I cannot cashflow whatever property I'm looking at (in an emergency), then it's overpriced. Simple as. Here in Florida, inventory levels are already past pre-pandemic numbers in quite a few places and homes are sitting because sellers are still living in 2022. It'll crack, just wait.
@@adoss7273 Florida? Ooof, the insurance and/or HOA fees alone.
We stopped building starter homes some time ago the average family have fewer children but the average square foot of homes have doubled. Builders don't build starter homes anymore and when you buy a lot to build often you are required to build a minimum of so many square feet. Plus as baby boomers age they are not giving up their low interest rates. Unless the economy crashes like the great recession of 2008-2012 when the financial, automotive and job employment all crashed this will be the new normal.
They are actually building many starter homes in the Phoenix area. In fact the average size of new homes has decreased. Smaller homes, less kitchen cabinets, less windows. The builders are trying to save money. I don’t have the source for the avg size of new homes.
@@nickm4662 Starter house: 2 bed, 1 bath with 1 car garage? 1100sq ft? They're building those in Phoenix?
Younger people in their 20's, 30's with 1 or 2 kids think they need a minimum 4 bedroom house
with 2 or 3 acres of land for their kids to play.
@@penguin12902 Well this is 2024, we’re not in the 1950’s anymore. Look up Meritage homes. Plenty of 3/2 homes with a 2 car garage. Around 1200 sqft.
@@markoman5267not true
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Potential sellers are frozen in place with a current low interest rate. If they sell, their rate on a new mortgage could be double ... and unaffordable. Anyone with CASH is ruling the market, they don't care about interest rates or coming up with a down payment.
All the more reason to become debt free and free up cash. The seven baby steps are there for the taking. It is how badly do you want it.
Co worker of mine needed a bigger place for his kids, gave up a 3% for a 6.9% mortgage, ouch.
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Try and picture what happens when the FED lowers rates. It's going to amplify the problem by a factor of three to five times. Super low inventory, multiple buyers, and low rates. Good luck everyone.
They may not be so quick to lower rates. Look what happened in Canada when they lowered just slightly.
Significantly lower rates aren’t coming unless an economic downturn hits that drives buyers out at the same time. In the backend though we’ll probably see another spike unless the Fed is aggressive about getting the rates back up like they didn’t do the last few times
Mortgage rates are not tied directly to the FED funds rate. Interest rates will stay high if home availability stays low regardless of what the FED does.
Half a million dollars is entry level these days? Damn. Glad I already have a home. Feel very fortunate. Not sure how our kids will ever buy a home though.
I guess it can be in an expensive coastal area.
Most of the country it’s not and as low as $60k where I live so don’t know why you feel so fortunate unless you live in the insanely expensive areas.
It seems near me prices are $250 for average, 500k for a step up, and 1 million for a custom/ stylish home. There are variations to this but $250k seems like the lower end starter home asking price. In my area the lower end starter home asking price was 100k, in 2015.
When we start saying no to the stuff. To the insanity. Just say no. Do without. Find something else. Focus on gratitude.
Seriously. Focus on gratitude.
In SC, there are so many builders that Ryan homes offered me 10k discount, free upgrades (granit countertops and laminate floor over carpet) and 15k closing cost (using their lender)
I just sold my house for $100k over asking in NJ in 5 days. Its crazy here.
Even with these rates? That is crazy
Lucky you?
I bought my condo in the summer of 2021. The one next to me was renovated and just sold the other day. I think the old owner said he got about 300k for it, so 100k over what mine sold for. That’s just insane that people are willing to pay that much for a condo.
I bought my home in 2020 for 240k. It is a mediterranean style 2 story 3 car garage 3,185 sq ft on a 9k sq ft corner lot. City views, mountain views. Today it's "valued" at 475K. I owe 193k on the mortgage at 2.9%
We had a 3%, we have to wait until newly elected officials are in before it drops.
So the house basically doubled in price in 4 years?
Wow that's insane.
This can't be sustainable.
If there isn’t 25-50% deflation of the dollar in the next few years then it’s sustainable. Inflation will get ya.
My girlfriend and her family moved to AZ in 2018. She bought her house 3.2 two story for $185. Her neighbor sold same type house 2022 for $500k. However not it’s worth $400k.
I take it not in a major city with $240k.
Asking price is irrelevant. It's purposely set lower than typical so more people bid. If you're getting beat on offers repeatedly, you need to move down in budget, location, or size. The market decides what something is worth and if you're not bidding to win, you will continue to lose (not only losing the house, but also opportunity cost and inflation). There is no such thing as a fair deal in this market. Just how high you're willing to go to move on with your life. In 10+ years it will not matter what you paid for the house, you'll just be glad you got one.
Banks do have something to do with all of this. If they lend more money than people can afford, knowing and not caring a liquidation will happen eventually, then banks have become enablers of bad practice. NO not the new 700K house will foreclose but the 1 room shanty that fetched 800 K in Cali which enabled the new demand. That shanty will foreclose if it has not already. So banks push this ill money across the country.
Something else I noticed is that there are so many studios and one bedroom apartments/condos abundantly available, but not enough 2 bedroom/3 bedroom condos. Some of these people want over a million dollars for these properties and some of these condos are just sitting there for months. If your condo has been on the market for 188 days in a hot housing market then you may be asking for too much money.
In my market chicagoland area if you don't have cash right now you're not getting an offer through probably need minimum 40% down with appraisal contingency waived. I passed on a 405k offer that was 3.5% fha and accepted a $385k cash offer because the 405k was never making it to the finish line. It's harsh out there no doubt you may have to look at houses 20% below the price you can afford to allow for the extra offer you may need to make.
Excellent point.
What do you mean “never making it to the finish line”? Were they just not responsive or what?
@@myllamaMan It wasn't going to appraise that high and they didn't have cash to cover the difference. Also with FHA there would be items on inspection that would need to be fixed whereas cash offer was as is no inspection no appraisal. Basically the 405 offer would have wasted a month of time and had to get relisted 95% likely.
@@k_vissI rejected a loan that was 20k higher because it had an inspection contingency and they could have easily found another 20k+ in repairs if they wanted to
Those who cannot afford houses outside the midwest are flocking here because of the cheaper housing and the current residents are going to be priced out soon.
Its changing. Here's in FL most homes are sitting. Even with price cuts.
Dave: I am filthy rich and own hundreds of millions of dollars worth of real estate, but I *never* pay “retail” (i.e., horribly inflated prices for us working peasants) for real estate. Kinda bugs me too because I have a stupid amount of money burning a hole in my pocket that I’d like to invest into it.
Also Dave: You, peasant, who has to scrounge for every penny, should just pay these obscene prices because it’s unlikely to get any better for you. 💀
Why u on here
@@marianmorgan2156cause he’s full of 💩
@@marianmorgan2156 On where? The comment section of this video? The video? CZcams? My phone? Planet Earth?
@@marianmorgan2156 he's a victim lol and will always be a victim
Overbidding and real estate speculation is rampant in Vancouver and Toronto but house prices are still reasonable here in Edmonton.
That's because for 8 months of the year you get the privilege of being a human popsicle in Edmonton while Xi Jinping's minions get the enjoy the nice reasonable Vancouver climate in the comfort of their mansions built with dirty money. The writing was on the wall 45 years ago and the government was either too stupid or too corrupt to stop it.
It started when the Chinese did this in Vancouver and this crap spreaded eastward.
Yup, more buyers than sellers. Market forces at work.
Exactly
Market forces after years of market manipulations.
(((Market forces)))
The housing prices in California and New York are not coming down either. I don't agree with this explanation. The salaries are not going up that much either to explain the overbidding. I don't know the answer myself. I wish there was more visibility on bidding process and see who are the people going into bidding war with.
THIS.
Another big issue is investors purchasing a large amount of properties. This creates a false sense of the demand and drives up prices/reduces inventory. It’s to the point where “regular” people can’t buy in many areas because the homes are swallowed up by venture capitalists before they have a chance. Not to mention the fact that salaries are not increasing at the same pace as cost of living. It’s rough out there.
Yes there is a lot of gaslighting with this issue. Houses are being bought up by corps, could even be foreign involvement. I read about it; foreign investors were waiting for Biden to get into office to do this, and that is what happened right after 2020 election. I know of several houses owned by people out of state that are being rented. One house was recently purchased by an entity from TX, far from me, and it appears immigrants rent it. Add to that landlords renting their places out under section 8 and group homes and it complicates it even more, but these issues are hushed. Nextdoor shut down discussions about a group home moving into a suburb area near me, they don't want the neighbors discussing it. Homes like that are cash cows for landlords. The landlords are often private buyers but they rent it out to the state! This should be illegal. I remember Trump mentioning the destruction of the suburbs and think this is what he was talking about. Basically a fascist takeover of the housing market right in front of our very eyes.
Utah is the opposite. Everything selling for well under asking price. Average is 20k under. Average is 2 months to sell a home.
Spot on. My rate is 2.75% i am in that class, not gonna sell anytime soon
Golden handcuffs. Congratulations.
@@evr0.904 Thank you
320k oooof here in california that gets you a burnt down home.
Or a tent in Vancouver and Toronto
If that, cant find a empty lot for that price in so cal
Yup
Bill Gates is smart enough not to buy in California, that should tell you something.
In Saginaw, that gets you a victorian mansion. No really, theres a 5700 sqft, 7 bedroom house on sale for 220k right now
Glad to read a comment section where people have common sense.
Nobody does anymore.
houses out here (NM) sky roccketed because many left certain states. prices have gone sky high too and yet they still sell like crazy here
you can't even build them fast enough, but most plates you see on cars coming into the area are from........ Cali.... so the house prices here are so cheap to them.
just like in 08 when i left NY and went to AZ. i couldn't believe brand new houses custom built in the mid 240 ranges. we were in our glory.... like WOW....
Definitely depends where you live. I bought a really nice 2 bedroom home in south Texas for 160k last year
Will stop when they quit printing ridicules amounts of money, so the answer is never!
Here in NJ it’s the same situation. Unless you’re in the Midwest there’s a much larger demand than supply.
To answer her question though many of these overbid houses are not individuals or families but investment companies or corporations.
Dave doesn't mention the fact corps are buying them. I don't think I have ever seen anyone on the show mention this small little detail and the topic comes up often. Why is that?
It’ll stop when people/buyers stop paying more than what something is worth. As long as there’s someone, anyone that’ll pay more, then the prices (for everything and anything) will always remain stupidly high. We’re all just hurting ourselves and it’s never going to stop till we stop.
I have been watching Florida real estate recently. The inventory there is going up pretty quickly for various reasons. Many people are being priced out by insurance hikes. Buyers are starting to hold off in some areas.
Realtors love it! they make so much more money !
Realtor love quick sales more than anytime else. They get such a small percentages, it does not pay top sit on anything for them. YOU want and extra 100K they only get how much for how much longer work? $1500 for another month or 2?
A buddy of mine knows a realtor that with the commission money he made (especially with the stupid overbidding), he bought a new boat and a big SUV to tow it with.
Also apartments are ridiculously expensive so buying a small house seems reasonable
Apartments where you live are ridiculously expensive.
I live in the rural midwest….
A 1 bedroom, 1 bath is 1k a month
@@johndawson7121 1K a month? You must be joking. I take that in a hot second if there were good career around.
@@Rashaadthegr8 its the rural midwest….there isnt…..
@@johndawson7121 here $2000
Worst advice I ever got was to not buy my home on a 30 year mortgage, I saved and am now priced out of the market. Thanks Dave
Good chat. It isn’t just a matter of demand in terms of number of buyers. It’s the obscene wealth that enables people to pay way over asking price, cash. It’s happening in Australia, too.
sorry lady this is the new normal
yes and we should expect this bullshit answer
We'll own nothing and be happy
@@MWebb-de9pq You might. Others won't lol work hard, save, and invest and we all can get a house. Stop quoting that fear bait bs lol
@Will-jg2zs it's not fear bait. It's literally what the WEF promotes. The WEF advises the IMF. The IMF controls the central banks. If you're not seeing a trend and paying attention to the actual numbers then you're oblivious or malicious.
What about corporate landlords buying mid-grade houses, fixing them up and renting them out? There are cities passing ordinances against this new trend of real estate investment because it is making it impossible for average folk to become landowners.
Depends how in disrepair the house is either they flip the house and it goes on the market at a high price or it's rented out
I too am in an area where housing costs have dramatically increased! Son wants me to move close to him in GA, & while prices are cheaper overbidding continues to be a problem due to the local military base etc. Not sure that move will work. . as if I have to rent 6-12 months while looking (after this house sells) it will rapidly consume what $$ I have available to buy. Plus hard to find a place to rent with dogs. My current home is getting too much for me to maintain (esp yard work & snowblowing etc). Can’t afford to pay for it so must do it myself. Yet in my current area here to downsize to a townhome where much yard work & snowcare is taken care of is financially unaffordable. I totally feel caught between a rock & a hard place. And my retirement income is limited . .
I agree with the migration aspect, some people are fleeing higher taxes, some people are fleeing forced birth and discrimination. I live in Massachusetts and it’s practically impossible to buy a house here, too.
I feel so incredibly fortunate to have bought my house years ago with a low interest rate in a state that values personal freedom.
Kill your 9 month in utero babies?
When you print trillions of dollars, causing the dollar to lose 25% of its value in 3 years, home prices increase. You need more dollars to buy the same stuff you were buying in 2019. Groceries, houses, cars, everything is more expensive because your dollar doesn't go as far as it used to. Add in the fact that housing inventory hasn't kept pace with demand due to legal and illegal migration and you can start to see why prices for housing is so high.
You dropped your dog whistle.
illegal migration is driving up home costs now? Its just supply and demand. Clearly you dont understand econmics.
Inflation in the US does not simply occur from printing money like you are implying here. You are conflating Pricing power parity with the number of dollars in circulation.
Also, how you shoehorn in immigration here is shortsighted - as the people who are primarily building new housing are (drumroll)… immigrants.
Your understanding of inflation and capital flows of the world reserve currency is shallow
@JDawgstwothousand go back to economics 101. Supply and demand. On track for ~10 million illegals since biden took office by the end of his term. They committed felonies to come here and you justify it by saying they build houses lol
Dave is definitely right about waiting on the sidelines hoping for a crash. So many people who could have bought earlier but waited now can’t afford anything now.
So many people sitting on huge credit card debt with a home loan on a house thats double what it was in 2019 with 7.5% interest…
Its a house of cards…
The financial system is cracking. There will be a massive recession/depression that will rock assett prices. The question is how long will the can get kicked down the road and for those that overpaid will they be underwater.
Your best bet is to be one of these slimey scalpers buying and selling a new house every year for 100 k over with no improvements. They are making a killing on peoples fear.
Where I live in a suburb of Massachusetts, people are getting upwards of $50,000 over asking price
That's what the banks are doing. There is no way some of these houses in upstate New york are worth what they are selling for. A duplex that i was tracking to buy for rental property price $99,990, sold for $230k. Some of these appraisals can not be accurate.
I don’t know, buying a house has never been easy, even back in the days. We weren’t high earners, I had been saving since I had a job after decades, and it still wasn’t something that we got easily just cause we wanted one, think we deserved one, or think we needed one. We rented all of our lives until I was 36, that’s when we felt comfortable to give not only 20% down, but still had enough for basic work the house needed before we moved in, leaving emergency intact. We under-bought, knowing we didn’t want the house to suffocate us financially. When I hear people complain about how difficult it is now, I just think “it’s not supposed to be easy, otherwise, everyone would have one, or two, or five”
@@JimmyJones-fe3fw you say that like it offends me.
@@JimmyJones-fe3fw You know what’s the funny part - you make up all these scenarios in your head about me. I must be SO different than you to afford something you can’t, or I must be lying about having something you don’t. I did start working & saving back in school in the 2000’s. I did pay for my own tuition and car when I graduated university. I did save a nice chunk of money to fund my 20% down & renovations when I bought a $470k home in 2018 at 36 years old, just 6 years go. It took me that many years to save be financially adequate and comfortable to own a house. I guess you’re questioning if I’d be able to afford my house now in 2024, 6 years after I bought mine? I’d say - sure, my house value have gone up by 25%, but I’m able to afford more now than before because I have saved alot more in these 6 years & my salary has also gone up in 6 years….so yes I can. You don’t need to believe me, I gain nothing from lying. But you do seem so very angry. You should probably see someone about that.
She does not understand how prices works. It's like she thinks the asking price is the true value set by some magical wisdom from on high. As Dave said, the value/ reasonable price is what someone is willing to pay.
Right, she's acting like home prices are the same as buying a bottle of lotion at the store at MSRP. Home prices are based on market rate.
Five years ago (2019), my wife and I talked about waiting for the market to flip back but in the end decided to purchase. Now looking back, we are glad we didn't wait. Homes that we were looking at are now $120,000 + up from when we bought plus the 5 years of paying rent ($1100 a month) would have been another $60,000 loss to rent.
When was this recorded? Becasuse the housing market has slowed down
The number of buyers vs sellers of houses is irrelevant when Blackstone keeps buying everything available. I'm in the same boat, I've been beat by solid cash offers 30-40k dollars over asking and then suddenly seeing the property for rent by corporations a month after closing.
Don't you mean Blackrock?
It’s Blackrock. They invest in corporations that own homes…..and so do I in my 401k and other accounts. Why aren’t you? Blackrock pays all of my utilities bills at my beach home.
Actually they are not buying everything available and they own less than one percent of the homes in the U.S..
You can blame the govt for allowing this. Zoning should prohibit it.
None of that actually matters that much.
If the amount of houses available to rent and to buy were adequate for the number of people trying to find a home, things would be fine.
I think building has slowed due to Covid, supply chain, and labor shortages.
There are statistics available about housing available and the size of our population. There is less housing available per person than there used to be.
The good news is, the money available to buy those houses won't last forever and the prices can't go up forever.
1) Lack of supply due to sellers unwilling to release their sub 3% mortgage rate.
2) Institutional investors purchasing millions of homes in an attempt to rent them out for profit.
Thats it.
None of that addresses the fact that there aren't enough homes built causing a shortage of supply.
Simply disgusting.
Here in Maryland its slowing down. I've been watching some of the higher stuff sit and only sell after a price drop or two (still not cheap). Add in rates being high and I'm not sure how people are buying unless you are downgrading from a more expensive home.
In Chicago, houses are standing and a lot are on the market 30 days plus. You can pretty much pick and choose which house you want, the housing market in the Chicagoland area has cooled.
My property is paid for and I have no plans to move. However, hearing all the grumblings about the lack of available houses, especially starter homes, if I were in the market today, I'd look at buying a piece of land and building on it. For a starter home, it doesn't have to be a McMansion. There are oodles of places online to get ready-made architectural plans for two- and three-bedroom starter homes. I would rather do that than get embroiled in the bidding wars going on now to get a house. It won't work for everyone, but I wonder how many people haven't considered it as an option and maybe should.
Many people have your same idea, including me. The problem is, good luck finding that. A few years ago I looked into some rural land to put a small prefab house on it or maybe even a trailer as a weekend or week long "get away" place. I was STUNNED at the prices. Good luck. Apparently, some others "got the memo" about the impending housing shortage - I'm thinking some really smart people who realized what was going to happen in November of 2020 and what that would mean to housing and the huge need AND expense of it going forward. I live in Ohio and ten or fifteen years ago you could EASILY get a nice hunk of rural property for a very good price (I'm talking about southern Ohio, in the STICKS and out of the way off the beaten track which is where I want to go) but today? LOL. It's all GONE or it's laughable what the price would be. Everyone has the same idea that you proposed. That's why houses, apartments and yep, even property in the country, is out of reach of the "regular" guy. It's not an option anymore. Just look at rural property available in your region. If it's anything like here in Ohio, it's crazy what is being asked. I looked at six acres in the middle of (proverbially) nowhere about two years ago. This was completely UNDEVELOPED land, surrounded by woods and with a small, narrow road about three miles off of a secondary road. No utilities at all. Just a patch of land in the middle of the woods with a frontal area that would have been nice for a small getaway place. When I say it was in the middle on nowhere, I think the nearest "town" was thirty five miles away and it had maybe two thousand people living there. The STICKS - and I mean a THREE hour drive from the Cleveland area I live in. They were asking something like thirty five thousand for that piece of land. If it had been within a short drive of a decent sized town ...... maybe, but this nearest town had gas stations and a few small grocery stores and not much other than that. The dream is gone.
Where you gonna find a lot in Philly? Have to go out into the sticks for that.
@@dyates6380 I realize this isn't the answer for everyone, as I said, but depending on where you are, it could be an option for some. I just pulled up Zillow and looked at land for sale in my area. Seven acres for $28K on the market for 152 days, 10 acres for $54k on the market for 102 days, four acres for $25k on the market for 130 days, three acres for $14k on the market for 288 days. While the prices are higher than they were four years ago, it's still an option. You can buy the land and plunk a little starter house on it for less than $150k. The thing is, a person has to want it bad enough to go where they can make it happen or just stay where they are and not make it happen.
@@Ja50nkAt Good grief. Did you not read my comment where I said it's not an option for everyone? If you want it bad enough, you'll go to where you can make it happen instead of staying where you are and not making it happen. Your option is to stay in Philly and not make it happen.
@@dyates6380 I realize this isn't the answer for everyone, as I said, but depending on where you are, it could be an option for some. I just pulled up Zillow and looked at land for sale in my area. Seven acres for $28K on the market for 152 days, 10 acres for $54k on the market for 102 days, four acres for $25k on the market for 130 days, three acres for $14k on the market for 288 days. While the prices are higher than they were four years ago, it's still an option. You can buy the land and plunk a little starter house on it for less than $150k. The thing is a person has to want it bad enough to go where they can make it happen or just stay where they are and not make it happen.
Philly is still so cheap. It's hard to see that market slowing down any time soon.
Philly is a godforsaken fentanyl ravaged murderous hell hole.
Live right outside but would never, never, go into Philly to even meet Jesus…
I live in the California Bay Area, overbidding is NOT happening here, prices going down. All the buyers are gone. 75percent of buyers are relocating, and no one is leaving their 2 or 3 percent loans. Housing going down!
It's been ongoing for 3 years here is the Kansas City Area. New houses aren't being built at anywhere the level they were before. Apartment complexes are being built like crazy. And builder is afraid to build is just a wrong opinion. You totally missed this fact: Corporations like Black Rock are buying up houses at rates close to market rate and turning them in to corporate owned rentals. I can't remember the last time I saw a home for sale by owner.
Simple supply and demand. People are waiving inspections and bidding 20,000 over asking with 20 offers. People also are not giving up 3 percent to go to 7. Market is broken.
Respectfully disagree - what you’ve described shows precisely that the market is working. People are making smart economic decisions based on the numbers you’ve listed. Not saying it feels good.
@@kkumdori Working for rich people.🤔
Where are poeple living that there is bidding wars? I got people begging me for offers north of denver. Housing prices are dropping here.
@@jayrobbinstacks4574 exactly. If you’re trying to find a hidden gem in manhattan or SF or LA, it’s not going to happen but there are plenty of other GREAT places to live.
Look at Vegas or north of Denver, there’s plenty of amazing places to live in this great country of ours.
@jayrobbinstacks4574 I'm in the Midwest. A friend just sold her house for $ 20, 000 over asking. Multiple offers. Same thing for a family member. 15 offers on the house they wanted. Some were cash offers.
This has happened in every country, here in Australia lots of people have moved west to Perth from Sydney & Melbourne able to pay a lot more for homes and driving up the prices to almost extortionate rates
Country areas (Vic) also rising. It sucks.
Thanks for explaining. So…when will it stop..
Dave is wrong on this one. Migration isn't helping, but the real problem is corporations that have millions if not billions that can afford to pay 100k over asking as they will make it back over the next 5 years and get it back with equity.
Also the 20 million people who have come across the southern ya-know, and now want housing
The exact same thing is happening in the rental market in Australia and of course buying houses also, the rich get richer and the poor get nothing not even a rental property to live in
Renting is for the rich. Especially in Australia.
Sad😢
He didn't say a word that everyone didn't already know. She didn't ask why it's happening she asked when will it end?
That's probably because there is no way for him to predict the future. Duh.
@613JMM obviously. Instead, he's condescending and explains supply and demand to her.
When you are a doctor and just pray you can afford an entry level house one day a teacher used to own 😅
No listing agent would advise their seller to accept an offer that much over ask unless the buyer can prove they have the cash to cover the difference. It's pretty simple really. If this lady keeps getting outbid then she should hire a new agent who is willing to go door knock and find an off market seller who is willing to sell for her price. It's not that difficult.
Yep, people don't want to put in the work or hire someone to do it for them. If you keep on doing what you've been doing and getting the same results... you need to change what you're doing.
Nonsense. Half the people making offers these days, are cash buyers. Finance is become more and irrelevant.
@@pm2886 Not what I am seeing in my market.
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Overbidding on homes is the dumbest thing to ever happen to a homebuyer.
You're digging yourself deeper into debt, especially when the mortgage is time to renew.
The only winners in this are the lawyers, the real estate agent and the municipality.
It never stops. Even in the 2012 trough of the previous housing cycle, investors were outbidding retail buyers in boom/bust markets like Phoenix and Las Vegas. The solution is to either live somewhere that few others want to or to bid on a house that few others like. If you want a desirable house in a desirable location, there is usually going to be competition for it - and the lower the price point of the houses you’re bidding on (area specific), the stiffer the competition will be, because of affordability constraints.
The people harmed the most in this market are first time homebuyers.
See a current homeowner who wants to move who has equity will sell their home for a high price and buy something at a high price, so a bit of a wash.
You have to overbid so long as Black Rock and Progress Residential are allowed to screw over families.
They have less the 1% of the houses.
thank you. dave just completely ignored the corporations buying up all the homes
@@GowthamNatarajanAIIf you really believe that youve been fooled. Shell companies are aplenty in the business world. These companies can buy real estate under an unlimited amount of names to hide the fact they are corporate buyers.
@@GowthamNatarajanAI That's not true at all.
I sold a couple of homes a couple of years ago and I was shocked when the house I purchased in 2006 adjusted for a inflation reflected a $40k loss. The amount of inflation over the ,last 18 years (especially the last 4) has been staggering.
I count my blessings that the good Lord saw fit to get me off my ass and refinance my house at near 3% before all this crazy nonsense. I feel bad for everyone else that didn't get to take advantage of those offers and are now priced out of even the crappiest overpriced houses on the market. Good luck to you all!
I can tell you one thing I'm doing though. I'm saving all the cash I can so when this bubble pops, I can buy one or two more properties so if they housing market skyrockets again I can liquidate some properties while still having one to live in.
Not until the government steps in and puts in rules/regulation to limit the corporations/foreign entities from buying up all the house. How is anyone supposed to compete against cash offers from them?
Yes, I wonder what those real numbers are or percentage of corporate and foreign entities are, unfortunately I don't think anyone has really investigate it.
It had been investigated, it's an extremely small number.
However it needs to stop
The idea that there are entire rental neighborhoods is crazy.
Some countries have laws against foreigners owning land, i wish the US did as well.
Regulations can also harm the small guy. Regulations can start with good intentions, but can end badly, especially with the corruption that is so rampant in corporations and government.
They just built an entire subdivision in my city that’s rental houses.
Soon. People are behind on homes and credit cards in record numbers.
Some people... Not all
That’s what happens when people live beyond means and buy homes that can’t truly afford.
Source
Is it enough to affect the market though.
Not yet.
@@janelleg597
Then cash will be king just like 2008.
in early 2010s in AL, one builder started new homes under or just around 200k, and WHAM like hot cakes a who big development was created. i mean you got what you paid for but people can't afford $400k+ on homes.... those developments moved really slow, to a point of stoppage.... the under 200k like insane hot cakes.....
Funny because the inventory in Florida and Texas in particular is rapidly increasing ( back to pre pandemic levels) due to condos being hit with $100k special assessments.
Lost faith in money holding value also drives up asset prices. As people realize that money is useless over time they seek to hold as little money as humanly possible and buy stuff that will always have value