Housing market

[Wizard of Ozz]

I think it's more fundamental than even that -- prices were too high, and people do not have jobs with wages to buy them. Blackrock has sold a lot of their homes over the last 2 years because contrary to what people think, they only care about yield.

There will never be any price correction big enough to fix what all the doomer videos and pundits keep yapping about. Never ever never. Period.

Building materials, labor cost, insurance cost, and land prices are only increasing. Depending on your area, there maybe be a small 5-10% cut... in my area prices are still up + 5-10% over LY.

These same moron real estate doomers have been posting about the huge mortgage rate cut that has been just around the corner for the last 5 years. Rates are not going down either.

People no longer go to college to get educated... they want to hang out, get high, post on social media, study their gender and expect the government or their parents to take care of them forever. This also explains the declining US birth rate over the last 50 years.

Most people 20-30 years old are too dumb to support themself... how can they support a family and/or pay for a house?

This is why you also see these same doomer talking heads pushing how wonderful renting is... you can throw your money down a shit hole for 30 years and have shit to show for it.

Blackrock and Black-Stone (same company) have also continued to buy a lot of homes over the last 2 years as well.

 

[BABMusic]

They can also afford to weather the storm and own more.

Sure, that's true. I guess it will depend on how much money they are losing and if the area they are holding is an area that they believe will stay in strong demand. I know Blackrock was letting go of lots of homes in Texas last year. Not sure about right now.

 

[BABMusic]

There will never be any price correction big enough to fix what all the doomer videos and pundits keep yapping about. Never ever never. Period.

Building materials, labor cost, insurance cost, and land prices are only increasing. Depending on your area, there maybe be a small 5-10% cut... in my area prices are still up + 5-10% over LY.

These same moron real estate doomers have been posting about the huge mortgage rate cut that has been just around the corner for the last 5 years. Rates are not going down either.

People no longer go to college to get educated... they want to hang out, get high, post on social media, study their gender and expect the government or their parents to take care of them forever. This also explains the declining US birth rate over the last 50 years.

Most people 20-30 years old are too dumb to support themself... how can they support a family and/or pay for a house?

This is why you also see these same doomer talking heads pushing how wonderful renting is... you can throw your money down a shit hole for 30 years and have shit to show for it.

Blackrock and Black-Stone (same company) have also continued to buy a lot of homes over the last 2 years as well.

I am not saying I disagree with you on most of this, and I actually think you could be right. The only thing I'll add though is that, building materials and labor costs were actually much higher during the last crash than what homes sold for. Just for fun, I looked at the price history of my mother's home that she bought in 2021. She paid $279,000 for her 3-bedroom with a nice basement. That same house sold for $49,000 in 2011! I'm absolutely sure that it would have cost a lot more than $49,000 to build the same house in 2011. Probably would cost $150,000 minimum.

It also depends a lot on the area. Some areas have already gone down quite a bit, while others have not. I know for sure that the government does not want prices to fall, but does that mean they will be successful? I don't have the answer yet.

 

[BABMusic]

 

[lol]

I worked at a certain bank during the housing market crash around 2008. Adjustable rate pick a pay mortgages, stated income (borrowers lying about their income) and not having to prove your identity (borrowers using stolen SSN's). Hundreds of bank failures, insane amount of foreclosures etc. The bank that acquired the bank I was working at went under in about a year as they kept pumping out those shitty option ARM's. Crazy times.

 

[JackTripper]

The real estate market is lopsided and don’t assume everyone wants it fixed. It’s a zero-sum game. To make housing costs more affordable, existing owners will need to give up equity. Take away that equity and you take aware the wealth effect, which sustains the current economy.

 

[Geo]

Hundreds of bank failures, insane amount of foreclosures etc. The bank that acquired the bank I was working at went under in about a year as they kept pumping out those shitty option ARM's. Crazy times.

The American people are still holding that debt, it didn't just disappear.

 

[BABMusic]

The real estate market is lopsided and don’t assume everyone wants it fixed. It’s a zero-sum game. To make housing costs more affordable, existing owners will need to give up equity. Take away that equity and you take aware the wealth effect, which sustains the current economy.

That's true, and that's exactly why the current economy is not going to be sustained. Home prices might stay elevated for a while, but it won't last forever. People have to sell eventually. A lot of fake wealth is in people's equity.

 

[lol]

The American people are still holding that debt, it didn't just disappear.

Well, while the banks were definitely at fault for what happened, the borrowers were complicit in it as well. Working at that bank for as long as I did, going thru acquisitions which did get messy, gave me both perspectives. However the banks received government help while borrowers were left hanging. One of the most common questions I would get when people were applying for loan modifications was “Where’s the bail out for the American people?!?” Twas a good question, however don’t forget the massive amount of fraud committed by people who were using stolen socials to acquire homes. The amount of loans I forwarded to fraud was insane. Changing the social on file to an ITIN was an immediate red flag and subject to fraud review. It was out of my hands once it went to the fraud department and I have no clue if anything came of it.

I forgot to also mention borrowers lying about their income in order to obtain properties they could not afford from the get go. Making the minimum payment on an option ARM meant deferred interest which resulted in the principal balance ballooning.

 

[BABMusic]

It's interesting that people somehow got this idea that home prices should be high. It started because of those low interest rates in the early 2000s and then continued until it didn't. The tech bubble of 2000 burst and then Wall Street wanted a new thing that could be the next bubble. Home prices were historically tied to the CPI for about 100 years and didn't go up or down much during that time. It's only in the last 25 years that we've seen these imbalances. A lot of people are going to be angry when they see a lot of their home equity evaporate.

 

[Geo]

Well, while the banks were definitely at fault for what happened, the borrowers were complicit in it as well. Working at that bank for as long as I did, going thru acquisitions which did get messy, gave me both perspectives. However the banks received government help while borrowers were left hanging. One of the most common questions I would get when people were applying for loan modifications was “Where’s the bail out for the American people?!?” Twas a good question, however don’t forget the massive amount of fraud committed by people who were using stolen socials to acquire homes. The amount of loans I forwarded to fraud was insane. Changing the social on file to an ITIN was an immediate red flag and subject to fraud review. It was out of my hands once it went to the fraud department and I have no clue if anything came of it.

I forgot to also mention borrowers lying about their income in order to obtain properties they could not afford from the get go. Making the minimum payment on an option ARM meant deferred interest which resulted in the principal balance ballooning.

That's pretty much when I knew we were cooked and started to buy gold and silver.

So, what do you think would have happened if we just let the crooks go bankrupt?

 

[Geo]

It's interesting that people somehow got this idea that home prices should be high. It started because of those low interest rates in the early 2000s and then continued until it didn't. The tech bubble of 2000 burst and then Wall Street wanted a new thing that could be the next bubble. Home prices were historically tied to the CPI for about 100 years and didn't go up or down much during that time. It's only in the last 25 years that we've seen these imbalances. A lot of people are going to be angry when they see a lot of their home equity evaporate.

Anytime the gobernment gets involved, shit goes south. We shouldn't have artificially lowered rates and just let the natural laws of the market dictate them.

But, the gobernment saw an opportunity to pay less on their debt and now we are worse off.

 

[lol]

That's pretty much when I knew we were cooked and started to buy gold and silver.

So, what do you think would have happened if we just let the crooks go bankrupt?

Unfortunately the couple who owned the bank I worked at, who had basically set the standard when it came to option ARM’s, knew exactly what they were doing and sold the bank before shit really hit the fan. The bank that acquired it, ended up taking the fall, which led to yet another acquisition. That new bank had to clean up the mess. Many banks did fail though. I believe it was 2009 where a record number of banks went under. But the “too big to fail” banks were practically rescued.

Then you had these so called “loan modification” companies try to capitalize on the whole thing. Even law firms! They would guarantee loan modifications while charging insane up front fees, and even more fees as the process went on. These companies and law firms were absolute scum, and many lawyers actually lost their license to practice due to their scummy tactics. They didn’t do anything that the borrower could not do themselves.

The whole situation was just completely fucked up in so many different ways. If anyone should have been severely punished for the housing crash, it was that particular couple who owned the bank I worked at. But they got away with it.

 

[lol]

One of the most painful moments I had working at that bank was when I worked in collections briefly. About 4 months or so. I had an outbound call and a woman answered. I asked for the borrower, who was her husband. She told me that he had committed suicide after receiving a notice of intent to foreclose in the mail. I was appalled and left completely speechless. I died on the inside. I posted out of the collections department and went to a different department that did administrative and various loan maintenance. One of the duties of that job was processing death certificates. I actually ended up getting a copy of that guy's death certificate and saw the cause of death. I died even more. I've never forgotten those moments and I still think about it sometimes to this day.

The bastards who owned and sold the bank passed away years back, but I hope they are burning in the fiery pits of hell where they belong.

 

[JackTripper]

Home prices might stay elevated for a while, but it won't last forever. People have to sell eventually. A lot of fake wealth is in people's equity.

The real estate market is comprised of hundreds, if not thousands, of regional markets. This may be true for some, particularly the "hot" markets that have seen huge runups in the last few years, but likely not most markets. That equity is here to stay.

 

[BABMusic]

The real estate market is comprised of hundreds, if not thousands, of regional markets. This may be true for some, particularly the "hot" markets that have seen huge runups in the last few years, but likely not most markets. That equity is here to stay.

Maybe in dollars, but in gold, houses have already gone down 50%. Some of the hot markets included Southern California, which has nowhere to go but down in terms of quality of life. I feel bad for anyone who bought a home in 2025 out there.

 

[Laputan Machine]

I don't think prices will come down, the government will just create some artificial way of inflating. IMO the entire thing is manufactured through various methods by the government. China is doing the same with theirs. The US and China are basically in a competition to see who can create the fakest GDP through phony real estate numbers.

 

[BABMusic]

They may try, but it won't work in the long run. You can't build a real economy based on the government buying housing bonds. Also, prices have been coming down since the beginning of 2025, at least where I live. They haven't crashed, but you can see it happening in slow motion.

Also, forgot to mention, China saw a HUGE drop in home prices over the last 2 years. Homes were down 40-60% in many city locations.

 

[JackTripper]

Maybe in dollars, but in gold, houses have already gone down 50%. Some of the hot markets included Southern California, which has nowhere to go but down in terms of quality of life. I feel bad for anyone who bought a home in 2025 out there.

Again, blanket statement and you are conflating a functional asset that provides shelter with an investment. I know someone that purchased a house in La Quinta in 2019, one of the hottest markets in S California, and since then the value of their house is up about 90%. Last year sellers in that market were settling for about 5-10% less than asking price. I am not seeing any downside to that scenario.