Housing prices up almost 20% in a year
- Thread starter Saltwater60
- Start date
Blimey
.450/400 Nitro Ex
Ryan homes has a new dev in victor ny i got an email about. Smallest houses are three bed two car and starting in high 400’s. That is a shocking price for a 2000 square foot new build Ryan home 25 min out of the city on the highway. In 2017 the same house was a touch under $300k in a much better location by Ryan homes. I did see another builder advertising a 2200 4 bed for $465 new construction, though.
I’m not convinced this is a huge bubble. If inflation stays these prices may never come down. In some areas people are taking their remote incomes and bailing out of the stupid cities like nyc.
Ryan homes are shit. They are the cheapest of the cheap when it comes to new home builders.
This is part of the plan.
spat
.700 Nitro Express
We moved into our place a year ago last week.
The C of O was issued at the beginning of last March.
It's probably worth at least 50% more than we paid now.
No way we could afford to build it now, if you could even find people to do the work now.
Truebeliever
6.5 Creedmoor
Here are some of the reasons for the super increase in housing on certain markets.
One, Baby boomers retiring. They are retiring and moving south or to AZ type places. They have the money from the sale of their NY or CA priced homes.
Two, investment companies like Blackrock are buying properties like crazy . They turn them into rentals while having the property as an inflation hedge.
Three, housing building slowed or stop during covid shutdowns. Less housing was available.
When will the bubble burst? When interest rates on mortgages go up. But if the NY/NJ is any indication of what will happen, it will just be some air out of the tire and not a true burst in the truly hot markets
One, Baby boomers retiring. They are retiring and moving south or to AZ type places. They have the money from the sale of their NY or CA priced homes.
Two, investment companies like Blackrock are buying properties like crazy . They turn them into rentals while having the property as an inflation hedge.
Three, housing building slowed or stop during covid shutdowns. Less housing was available.
When will the bubble burst? When interest rates on mortgages go up. But if the NY/NJ is any indication of what will happen, it will just be some air out of the tire and not a true burst in the truly hot markets
This is all infalted by the powerful. Nothing more and nothing less.
spat
.700 Nitro Express
Some markets, like down here, will remain hotter than hell.
As for others, lets just say I'm happy I'm not invested in commercial real estate in NYC.
Once people started working from home, and liking it. Once companies realized their employees were still productive that way. Thise companies realized just how much money they had been wasting on office space they simply do not need.
livingston
20×102mm Vulcan
Work from home because of the fuel and cost of auto ownership as a whole. ... I can see if one has trouble finding workers .. Working from home as a big perk ....
spat
.700 Nitro Express
To say nothing of the hours.
When I used to have to go into the office, it was a 45min drive each way.
That's 7.5 hours a week I was dedicating to work that my employer was not receiving any benefit from.
work from home gave me a significant effective raise in the form of gas and car wear and at the same time effectively cut the hours I had to work, giving me almost the equivalent of another day off a week.
And it didn't cost my employer a cent In fact, they can stick someone else in my old cube and it will save them money.
They keep thinking this. They don't realize just how wrong they are.
If we own nothing, if we are constantly beholden to the elite for rent, food, etc., if there is no future left for us other than misery and slavery, certain historical truths will reoccur.
96coal449
.308 Win
Most definite.
Blood will be spilled. Most Americans are unaware and far from prepared.
Saltwater60
.950 JDJ
Keep in mind that $465K is zero upgrades and zero plan changes. That house is more like $525K not the price quoted.
The reason they’re I’ll come down is the boomers will die off and there will be extra homes. The birth rate has dropped and there are a glut of 60+year olds out there. They have to drop. This prices are truly unsustainable. If you have a 20% increase year over year in around 4 years the home price will double. That’s unsustainable and simply can’t be done.
I’m literally on a spending freeze. I bought $80 in fish for my aquarium and $20 in fishing lures in a month or so. I’m buying nothing extra.
My wife did say she wants to do the pond waterfall and some plants to spruce up the area where we removed the tree though. I’m fine with that since I like that stuff.
Saltwater60
.950 JDJ
Work from home is becoming more and more common. My wife’s job is hiring and it’s a work from home position. Her out of date with the times boss said sell it on a work from home position because a few people applied and want higher salary ranges than what is being offered. The HR chick came right out and said the work from home pitch isn’t a perk anymore as almost all positions are offering that now in this job class.
All true...
Interesting is this... Those homes, the homes you really want, practical, having all those amenities you want and can use, plenty of space for your use, etc., always seem at the edge of your finger tips, just out of reach, or just a tad beyond what we would feel as being reasonable!
It is by design!
I just toured a bunch of new construction communities, and totally can see houses that were 300k a year ago, now in the 4-500k range! Private sale of property in those communities being pumped up 1-2x their value, but they're desirable lots. Those houses will all the bells and whistles, easily into the 5-600k range (land included) that make you shake your head! And yes, all 2k-2.8k sqft homes, .5 acre lots. And the person showing the home fully acknowledging the fact that all these prices are crazy, but is what the market is supporting! Bottom line, as noted above, there's a crush of relocation occuring for a multitude of reasons. Baby Boomer retirement, remote work, etc...
Risk assessment in regard to valuation has a lot more to do with the risk tolerance of the person than it does the market... If you make the move and it's affordable, most of these places are not going to see the extreme tax burden jumps like you see here in the NE because their Gov't (state, local) really don't provide much services. But amazingly, the roadways are all well kept and everything is clean! How the fuck do they do that when we are some of the highest taxed municipalities in the country and our roads look like shit! Anyways... Risk tolerance is a personal thing, but real estate "over time" just doesn't go down...
That's why I'm not worrying about a thing! And yeah, even if I have to take a note on a portion of the homesale price. Rates are still ridiculously cheap... Anything under 6% is a steal because you'll be able to make that in ROI in the markets so, it's a wash. But I'll tell you this, heading into the final chapter of my life, I'm not willing to settle! I'm going and getting what the fuck I want, and I don't really give a shit that it costs maybe a little too much to my liking! Ok, no worries! The kids get to keep or sell it off, my wife is well provided for should I expire first, so she'll be able to keep it or do what she wants should that happen. But I want space, I want a well established community with all the amenities I want, what I want... that 3 car garage with a lift, epoxied floors, etc., etc... And if I build it myself, or pay someone that 20% bump to do it, well ok, not worrying about the small stuff!
Trick is this... When your bell tolls and it's time to go, the balance sheet should ring $0.00... nothing left on the table! There are NO U-HAULS following the hearse to the graveyard! So what the hell is there to worry about?
Lmao!
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There have been two major real estate recessions that I can recall. First was in the northeast around 1991 and predominantly in the NJ/NYC area. The second was in 2008 and impacted a few markets like FL, CA and Vegas. In both cases prices were run up significantly in the years before with cheap loans and the expectation that prices always go one way - up.
Those two bubbles didn't impact prices in many other areas. Specifically Rochester NY saw very slow but steady incremental increases over those time periods. The current bubble is different in that it affects almost every geography (including Rochester). This is a direct result of the government printing and pumping trillions into the economy.
I don't know how much longer this can go on. I expect prices to plateau and then start to decline as the economy enters a recession and people begin to default. I was thinking of selling my house and potentially relocating but those plans are on hold. I am betting that in a few years things will be different.
Those two bubbles didn't impact prices in many other areas. Specifically Rochester NY saw very slow but steady incremental increases over those time periods. The current bubble is different in that it affects almost every geography (including Rochester). This is a direct result of the government printing and pumping trillions into the economy.
I don't know how much longer this can go on. I expect prices to plateau and then start to decline as the economy enters a recession and people begin to default. I was thinking of selling my house and potentially relocating but those plans are on hold. I am betting that in a few years things will be different.
Saltwater60
.950 JDJ
I agree. Just wait until they start collecting student loans again if they do. All those people that had deferred loans for all those years spent that money on buying a house or a car.
I also agree a recession is coming and it can’t come fast enough for me. I want it so I can buy a cheap car or two.
Saltwater60
.950 JDJ
This economist sees a drop in mortgage and refinancing applications and predicts a down turn in demand for houses. Makes sense with the cost of everything going up people deciding to stay put
www.marketwatch.com
‘The housing market is in the early stages of a substantial downshift': Home sales may drop 25% by the end of summer, according to this analyst
The expected drop in home sales could bring relief to renters over time.
www.marketwatch.com
Blimey
.450/400 Nitro Ex
20% YoY several in a row for sure it cannot be sustained, but my area has appreciated so slowly that a one-time bump even of 50% can probably be absorbed. In much of the country it's still inconceivable to buy a new four-bedroom build for half a million. 20 min east of Rochester there is another ryan neighborhood building such homes for the mid 300's. When they started the dev a couple years ago it was houses in the high 200's but now that they are actually putting them in the ground it's higher.
Blimey
.450/400 Nitro Ex
I agree. They still use 2X4 framing, which I don't believe anybody else does. Their foundations look good though: almost invariably poured 8' walls and they use the same drain system as all the other builders do (I walk around new developments).
Saltwater60
.950 JDJ
Then you have morons like this. Let me waive all my inspection rights then bitch I have to do repairs I can’t afford because I spent too much. Oh wait I have to pay back those student loans uh oh now o can’t afford this place. When the market goes bust and prices drop they will be upside down and .gov will bail them out, again.
Blimey
.450/400 Nitro Ex
I never understood why people would waive inspections. At the least I would, as a buyer, commit to getting one within 72 hours or something.
I see mortgage rates are skyrocketing.
MothMan
.338 Win Mag
Maybe it will the 40 something stressed out state employee that drops first, leaving a big mortage for their spouse to enjoy. Just sayin. 
Saltwater60
.950 JDJ
Yes they are. Prices have dropped for the first time in years as a result.
1075tech
.338 Win Mag
One new construction house I looked at has come down 30k in the past 2 months.
How much margin is built into these?
I told my realtor to let me know when they are willing to come down another 20
How much margin is built into these?
I told my realtor to let me know when they are willing to come down another 20
Saltwater60
.950 JDJ
sounds like 25% profit is common. Rates are climbing so balance that into it as well so maybe $10,000 now and locking in the interest rate might save you money.
How Much Profit Does a Builder Make on a New Home?
If you are wondering what the gross and net profit margin a home builder keeps for themselves is, here is a detailed overview of the same.
www.cohesivehomes.com
96coal449
.308 Win
Some do to save money. They are financially strapped while trying to buy a home.
Some are in the field of working on homes and know what they are getting into.
Saltwater60
.950 JDJ
Right now people are doing it because it’s more attractive to the seller and they have 15 other offers for the house. The sellers don’t want to have to deal with it if they don’t have to. I’ve heard this from multiple people buying and selling homes in my area. Some really stupid people doing it too.
I could do my own home inspection, but I paid for one last time because there were a few things I wanted done and it was leverage for me. It worked and I got the two things repaired I really wanted done. A chimney cap in place on a 45’ tall roof/chimney and the foundation repointed because I was moving in late November and I didn’t want it sitting all winter and I had tons of inside work to do. I had no time to repoint and I hate heights. It more than laid for itself.
96coal449
.308 Win
Sometimes it's good.
Saltwater60
.950 JDJ
I’ve been saying it for a bit here, but seeing more and more that the market will crash. Make wise choices and don’t get caught with your paints down. The crash will come, interest rates will climb and a recession will hit. Don’t get into a mortgage you can’t afford.