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The U.S. housing market headed toward significant contraction since 2006

8 points by fairytalemtg 4y ago

codefreeordie 4y ago
It's really funny how hard everyone is pushing the "prices won't go down" line. They might not, it's totally possible -- but every article about the housing slowdown I've seen in the last three months all have virtually word-for-word the same disclaimer about prices not going down. It's really weird and feels like pushed messaging.
- uejfiweun 4y ago
  My guess is that once again, people on wall street thought that housing prices would never go down, so once again, they made incredibly stupid risky bets on this, so once again, there's gonna be a massive financial crisis if the market crashes.
- anm89 4y ago
  The only thing is, who would sell their house right now? Everyone is locked into great rates and cheap prices and will get screwed if they move. Obviously there are a lot of reasons and exceptions but overall I think this is true for most current homeowners. I think the only way is a severe enough recession where people start getting foreclosed on. If that were to bring a lot of supply back on, prices would plummet.
  - codefreeordie 4y ago
    Some people are way behind on their mortgages (remember we stopped allowing foreclosure for a long time due to COVID). Lots of people got forebearance but are behind again. Some people have adjustable rate loans, because they needed the lower rate to qualify, and are going to have problems when it adjusts. Some people relocate, especially as remote work is still here and COVID decision paralysis ends. New houses are still being built. Some people are cashing out huge capital gains and are looking to rent. Overall, listing volume is pretty low, but it's far above zero.
    - anm89 4y ago
      Agreed, I'm just saying we need to get a lot deeper into this trend before housing momentum swings the other direction. Personally I don't have conviction yet which way it is going to move. I don't think it will head up any further but I'm between flat and down loosely leaning towards flat. But I have a feeling if it does start to swing, it will be violent towards the downside. As someone who's looking to buy a house I'd be lying if I said I wasn't hoping for a violent swing down
      - codefreeordie 4y ago
        In the market in which I am trying to buy a house, prices have fallen a little already -- but only back to what they were maybe 90 days ago, when prices here were still increasing about 5%/month. I, too, hope they fall materially but don't know whether they will or not. I just find the way these articles are written to be suspicious and funny.
ohiovr 4y ago
In Marion Ohio zillow is now showing houses again at the 40K, 38K and 20K prices. Houses priced at that level were no where to be seen 6 months ago all the way back 10 years. Something is going on.
fairytalemtg 4y ago
https://finance.yahoo.com/news/us-mortgage-applications-meltdown-threat-153530718.html https://finance.yahoo.com/news/us-mortgage-applications-melt...

8 points by fairytalemtg 4y ago

It's really funny how hard everyone is pushing the "prices won't go down" line. They might not, it's totally possible -- but every article about the housing slowdown I've seen in the last three months all have virtually word-for-word the same disclaimer about prices not going down. It's really weird and feels like pushed messaging.

uejfiweun 4y ago
My guess is that once again, people on wall street thought that housing prices would never go down, so once again, they made incredibly stupid risky bets on this, so once again, there's gonna be a massive financial crisis if the market crashes.
anm89 4y ago
The only thing is, who would sell their house right now? Everyone is locked into great rates and cheap prices and will get screwed if they move. Obviously there are a lot of reasons and exceptions but overall I think this is true for most current homeowners. I think the only way is a severe enough recession where people start getting foreclosed on. If that were to bring a lot of supply back on, prices would plummet.
- codefreeordie 4y ago
  Some people are way behind on their mortgages (remember we stopped allowing foreclosure for a long time due to COVID). Lots of people got forebearance but are behind again. Some people have adjustable rate loans, because they needed the lower rate to qualify, and are going to have problems when it adjusts. Some people relocate, especially as remote work is still here and COVID decision paralysis ends. New houses are still being built. Some people are cashing out huge capital gains and are looking to rent. Overall, listing volume is pretty low, but it's far above zero.
  - anm89 4y ago
    Agreed, I'm just saying we need to get a lot deeper into this trend before housing momentum swings the other direction. Personally I don't have conviction yet which way it is going to move. I don't think it will head up any further but I'm between flat and down loosely leaning towards flat. But I have a feeling if it does start to swing, it will be violent towards the downside. As someone who's looking to buy a house I'd be lying if I said I wasn't hoping for a violent swing down
    - codefreeordie 4y ago
      In the market in which I am trying to buy a house, prices have fallen a little already -- but only back to what they were maybe 90 days ago, when prices here were still increasing about 5%/month. I, too, hope they fall materially but don't know whether they will or not. I just find the way these articles are written to be suspicious and funny.

ohiovr 4y ago

In Marion Ohio zillow is now showing houses again at the 40K, 38K and 20K prices. Houses priced at that level were no where to be seen 6 months ago all the way back 10 years. Something is going on.

fairytalemtg 4y ago

https://finance.yahoo.com/news/us-mortgage-applications-meltdown-threat-153530718.html https://finance.yahoo.com/news/us-mortgage-applications-melt...