6 ms·

Unfortunately housing will still not get cheaper because nearly the entire supply is locked into 30 year loans at near 0%, even a fool would starve, default the

by ty6853 1y ago

Unfortunately housing will still not get cheaper because nearly the entire supply is locked into 30 year loans at near 0%, even a fool would starve, default their car note, and sell their every last valuable before giving that up.

slashdev 1y ago
In general yes, but in practice housing prices are down big in a lot of areas and still falling. Decisions happen at the margin, which means it's the marginal home owner who lost their job and has to sell, which pushes up supply at a time when demand is very weak - and that's your lower prices. But it's very regional. Some areas will continue to see rising or stable prices.
- FinnLobsien 1y ago
  That's the big problem. You can find cheap housing easily, but not where most people want to live. The problem could even get worse if there are fewer opportunities, but they remain concentrated in the Bay, NYC, etc.
  - deleted 1y ago
    [deleted]
  - shortrounddev2 1y ago
    Different world post-covid. Lots of people are willing to live in the middle of nowhere to buy a house, they just couldn't before because they needed to live near major job markets. A lot more people are able to work remote now. I'd say that it changes the situation a little, but not everyone is able to work remote yet, so there's still the draw toward large city centers like you say. But personally I've met plenty of people who ditched their big city for the midwest as soon as they got approval to go remote. When their companies told them to go back to the office, they quit and found another job
sambull 1y ago
We won't ever see a 2008 style price drop again. My house was going for $399K before I bought it in 2011 for $199K @ <4%. Unfortunately we got lucky, the big players in REO weren't ready to 'close' that many packages last time. My first devops role was at a company that was working with big players to make sure next time this exact scenario presented itself the big guys will be able to deploy their cash to gobble these things up.
- tossandthrow 1y ago
  Risk tends to build up and be released in different ways every time. It is right that it is not likely a credit crisis that will be the trigger next time. But it could be hyperinflation - which would de-facto crash the housing market. Right now the PE value for the housing market is really high, and it is not likely to continue up forever.
- LastTrain 1y ago
  Go find a graph of housing prices 1963 to current, you will see that the events leading up to and including 2008 did nothing to help or hinder housing affordability in the long run. We are due a 2008 style correction but that will not make housing affordable either. The real problem is that household income stopped outpacing home prices in the 1970s.
  - ty6853 1y ago
    The materials are very cheap. Last year I built a house for ~30k shell, about ~60k with utilities and everything inside of it. My own labor. Of course, there are only a handful of counties that will let you do that without licenses, or a building plan, or inspections at times that preclude holding a job. Because there is always some self-righteous actor, screaming at the rooftop that their neighbor is going to kill the whole neighborhood in a fire, no matter that housing has been virtually completely unregulated for owner/builders in my county for 2 decades and none of the hysteria people warned of came to fruition. The plus is all these people screaming for expensive regulations are absolutely scared shitless of my area, and do not live here. Which is nirvana.
rthomas6 1y ago
Well I'm moving to get out of Alabama, so not everyone...
aprilthird2021 1y ago
I keep hoping it won't require a Bane-style takeover of major housing markets for me to afford a house, but that hope fades a bit every day
danny_codes 1y ago
That effect only persists as long as people can pay their mortgages. Unfortunately the vast majority of people require a car to survive, and require food to survive. Defaults will begin if/when recession bites hard.
ActorNightly 1y ago
Depends. If job markets start taking a significant hit, there is a crossover point at which people will be selling houses to either move or for cash.
deleted 1y ago
[deleted]

by ty6853 1y ago

slashdev 1y ago

In general yes, but in practice housing prices are down big in a lot of areas and still falling. Decisions happen at the margin, which means it's the marginal home owner who lost their job and has to sell, which pushes up supply at a time when demand is very weak - and that's your lower prices. But it's very regional. Some areas will continue to see rising or stable prices.

FinnLobsien 1y ago
That's the big problem. You can find cheap housing easily, but not where most people want to live. The problem could even get worse if there are fewer opportunities, but they remain concentrated in the Bay, NYC, etc.
- deleted 1y ago
  [deleted]
- shortrounddev2 1y ago
  Different world post-covid. Lots of people are willing to live in the middle of nowhere to buy a house, they just couldn't before because they needed to live near major job markets. A lot more people are able to work remote now. I'd say that it changes the situation a little, but not everyone is able to work remote yet, so there's still the draw toward large city centers like you say. But personally I've met plenty of people who ditched their big city for the midwest as soon as they got approval to go remote. When their companies told them to go back to the office, they quit and found another job

sambull 1y ago

We won't ever see a 2008 style price drop again. My house was going for $399K before I bought it in 2011 for $199K @ <4%. Unfortunately we got lucky, the big players in REO weren't ready to 'close' that many packages last time. My first devops role was at a company that was working with big players to make sure next time this exact scenario presented itself the big guys will be able to deploy their cash to gobble these things up.

tossandthrow 1y ago
Risk tends to build up and be released in different ways every time. It is right that it is not likely a credit crisis that will be the trigger next time. But it could be hyperinflation - which would de-facto crash the housing market. Right now the PE value for the housing market is really high, and it is not likely to continue up forever.
LastTrain 1y ago
Go find a graph of housing prices 1963 to current, you will see that the events leading up to and including 2008 did nothing to help or hinder housing affordability in the long run. We are due a 2008 style correction but that will not make housing affordable either. The real problem is that household income stopped outpacing home prices in the 1970s.
- ty6853 1y ago
  The materials are very cheap. Last year I built a house for ~30k shell, about ~60k with utilities and everything inside of it. My own labor. Of course, there are only a handful of counties that will let you do that without licenses, or a building plan, or inspections at times that preclude holding a job. Because there is always some self-righteous actor, screaming at the rooftop that their neighbor is going to kill the whole neighborhood in a fire, no matter that housing has been virtually completely unregulated for owner/builders in my county for 2 decades and none of the hysteria people warned of came to fruition. The plus is all these people screaming for expensive regulations are absolutely scared shitless of my area, and do not live here. Which is nirvana.

rthomas6 1y ago

Well I'm moving to get out of Alabama, so not everyone...

aprilthird2021 1y ago

I keep hoping it won't require a Bane-style takeover of major housing markets for me to afford a house, but that hope fades a bit every day

danny_codes 1y ago

That effect only persists as long as people can pay their mortgages. Unfortunately the vast majority of people require a car to survive, and require food to survive. Defaults will begin if/when recession bites hard.

ActorNightly 1y ago

Depends. If job markets start taking a significant hit, there is a crossover point at which people will be selling houses to either move or for cash.

deleted 1y ago

[deleted]