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Comment by dilyevsky | Hacker News Reader

People will not sell at a loss bc they locked in to 2% mortgages for 30 years so no

The same phenomenon happened in 2008. I think it boils down to the question of whether or not sellers are motivated at scale.

In 08, the poor labor market meant that many people had to sell. That caused prices to drop.

We aren't at that point yet this time, and I don't think anyone knows whether or not we are headed for a seriously rocky job market.

Yeah but a lot of those 08 mortgages had much higher rates and even variable rates in the subprime division. Labor market is holding strong rn so even if it happens it’s gonna take much longer than a few months

They were giving mortgages to people they knew couldn't afford them in 08. I have not seen any evidence of that here.

I think the implication here is if you lose your job and can’t find it for a while you suddenly can’t afford your mortgage either

The job market is still historically EXTREMELY strong. We would need unemployment to hit over 5-6% before mortgages became an issue.

If you mean dentists, lawyers, and doctors. Yeah, they were giving too many prime borrowers with great credit scores way more debt than they could sufficiently manage.

I don't think 2008 was nearly the same in terms of the fixed rate mortgage positioning. A seller in 2008 could likely move and get a mortgage at a practically the same rate as the one they were leaving. That meant that trading down in housing cost would improve their cashflow.

Sellers now with a 2.75% fixed-30 mortgage could trade down a significant amount in housing cost and end up with worse cashflow if they take on a new mortgage at 5+%.

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