More Than One in Four Home-Sellers Dropped Their Price Last Month
redfin.com
redfin.com
https://www.calculatedriskblog.com/2013/06/house-prices-and-...
"There’s no strong correlation between interest rates and home prices,” said Douglas Duncan, chief economist at Fannie Mae.
If interest rates keep heading up it's a good bet we're setting up for a repeat of that last crisis. Let's hope the banks are better prepared and have loaned money to less questionable people.
It would also be instructive to see the shorter term rates, not everyone finances for 30 years.
So I would say in theory and in practice interest rates have major impact on house prices. We would not have the bubble without the low interest rates as people wouldn't not be able to finance the purchase of those houses at those prices.
So the same company that lied through their teeth during the 2008 crisis and buildup to it, to give the banks ability to package junk loans as AAA CDOs? The one that had to be bailed out by the taxpayer eventually? Sure, let's listen to them, they sound like a trustworthy source.
Please don't argue ad hominem, if you have an issue with the statement then make your objection directly.
There is nothing exceptional about THIS economist that would make him right. The OP had the right idea.
In this case, the author's data-based assertion of non-correlation is much weaker than Douglas Duncan's. I think based on Duncan's background, it is fair to dismiss his quote entirely without further context and base conclusions only on the data presented. In addition, since the author presents an unreliable source, one may suspect the data is skewed to support that source, conciously or unconsciously.
In Denmark housing is way higher than it was before the crisis, but wages aren’t really up.
The market has now reached the point where the middle class can’t afford to buy a home near our biggest cities.
Of course it’s going to end poorly. Especially with the aging population. If we didn’t own an appartment in the central part of time that was bought at 30% lower than the current prices I’d honestly be shitting bricks.
Also terrified that if I ever did buy, the bottom would fall out on me. Most of the homes in my area are a few million even if they’re objectively garbage.
I'm going to guess that "in a city that I want to live in" is a fairly short list. In most of the country, a few million gets you a palace.
You might consider re-evaluating where you want to live. Most of the rest of the country isn't horrible.
In most by geographic area, sure, but most of the country by geographic area is sparsely populated because, to a rough approximation, no one wants to live there (at least, after accounting for work opportunity.) In urban centers that aren't going through collapse, it doesn't go nearly that far, though outside of Manhattan and San Francisco (even in the same metros) it'll still get you a pretty nice place.
Seattle, San Francisco/San Jose, NYC, maybe Los Angeles and San Diego are that overheated. But that's not even the majority of the population of large metro areas.
I mean, I get it if someone doesn't want to live in Boise or Omaha. But what's so bad about Denver?
But, well, if you want something different than what you've been getting, you're going to have to do something other that what you've been doing. I'd suggest that it might be worth re-thinking whether you really want to live in those places, at the price it's costing you. And if you do, then you do - it means that you're giving up what you want less (to own your own home) in order to get what you want more (to live in one of your chosen cities).
So, if you haven't moved your house by now, it's probably not gonna move until next spring.
I would be more interested in how many simply delisted and will wait until next spring.
The combination of higher interest rates and tax code changes which limit mortgage interest deductions[1]. While $750K seems like a pretty high cap for limits to kick in, in the Santa Clara county, the median house price is over $1.3M so that is over $500K of mortgage interest you can't deduct.
That changes the calculus of buying an expensive house and I would not be surprised if that is reducing the number of buyers.
[1] https://www.marketwatch.com/story/what-the-new-tax-law-will-...
Also there is data from CAR which shows both sales price and sales rate is declining. Inventory should start to build up going forward as home sit on the market longer.
I have been watching Zillow price drops well for Tucson, where I've been looking to buy, and waiting for things to hopefully cool off.
If there had been just one house not selling that fast I'd have assumed overpriced, or something noticeably wrong with them, but even the new builds are struggling to sell at a price that would have been market competitive back in July / August.
Still insane.
For anyone who has been through the process of selling a house right at the start of a market turn — what advice would you give? It seems like I need to get rid of the house ASAP, but are there any other important steps that I might miss?
There is pretty much no way you won't lose money unless the house went up in value a huge amount since you bought it -- enough to cover all of the costs you incurred when buying it and when selling it.
On the other hand, you might be able to cover a large portion of the mortgage payments by renting it out, depending on the rental market in the area.
Are you crazy? An absentee landlord can't keep close tabs on the property. It can be trashed, or the tenant can stop paying rent.
I didn't rent my old house out for that exact reason.
Also, don't sweat a price drop as long as the market you're moving to doesn't lag the market you're in. You might lose money when selling, but if the other market is stalling too you'll pay less and it could be a wash.
Timing a market slowdown such that you sell before a drop and buy after a drop is nearly impossible with a primary residence.
Unfortunately, I moved from semi-rural countryside to the Bay Area. I won't be buying a house here any time soon haha
I looked my place up on Zillow a few weeks ago, and it said $1.5 million. There's been only 1 sale here in the past 2 years, artificially low at $950K. A neighbor's just sold for $1.32M.
Meanwhile, Redfin has mine at $1.04M.
Zillow has my original purchase price at about 45% of what it actually was (and publicly recorded at).
WTF?
I’m in Atlanta and it’s nice to see prices cooling off. Especially since I want to buy soon. A lot of lisitings look like the sellers are way too high especially in hot areas.
https://www.piggington.com/september_2018_housing_data_slowd...
TLDR: Sellers are trying to squeak out higher prices than in the past and the market is not accommodating the maneuver, or it is a tactic where an initial over inflated price + reduction is a ploy to dangle the properties at the true-wanted initial price.
> We define a price drop as a listing price reduction of more than 1 percent and less than 50 percent.
I would like to see the number of houses that increased their listing prices by more than 1% for a clearer picture. Without that information, I don't see how this graph leads to the conclusion of a general price drop.