YellowFever
New member
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Indications that the market is slowing down a bit?
- Thread starter YellowFever
- Start date
Long ago I remember when this was IHB and the site basically detailed how crazy the market was in Irvine and how none of it was sustainable. Full of housing bears and zero hedgers. That was 12 years ago or so. I'm pretty sure every house ever festured on IHB is like 2x-3x today.
Buy now or be priced out forever.
Buy now or be priced out forever.
Perspective
Well-known member
ZeroHedge is extreme entertainment for folks who believe they think differently and are smarter than the crowd. If you want the quality of your life, and decisions, to improve, breaking this habit will serve you well.
zubs
Well-known member
ZH has been accused of being a Russian shill site by one of it's ex writers. If you read it keep that in mind.
Here is ZH denial of it:http://www.zerohedge.com/news/2016-04-29/full-story-behind-bloombergs-attempt-unmask-zero-hedge
So not only is it a bear blog, it seems Russia leaning.
like John Stewart's affinity for Democrats.
Here is ZH denial of it:http://www.zerohedge.com/news/2016-04-29/full-story-behind-bloombergs-attempt-unmask-zero-hedge
So not only is it a bear blog, it seems Russia leaning.
like John Stewart's affinity for Democrats.
I've been reading IHB for a long time. Many of the housing market fundamental Larry talked about in the IHB are theoretical sound. However, Irvine's housing market is sort of like those high tech stocks, fundamentals sometimes just don't really apply.
From my limited observation, here are a few things IHB missed or didn't account for regarding to Irvine housing after the housing bubble:
1. Interest rate drop by half, drop from mid 6% down to around 3.5% for 30 year fixed.
2. Investor buying frenzy. Investors of all type, individual, corporation, hedge funds snap up homes in the hundreds.
3. Misinterpret Irvine's household income. Income for the potential home buyers are more relevant than those of retiree, young single apartment renters, and college students. Irvine's average income is around $80k-$90k but I'm guessing the average household income of those new home buyers are twice of that.
4. FCB! There are significant increase of wealthy immigrants buying up properties after the housing bubble.
Now Irvine's home price are at all time high and we are facing numbers of head wind in the near terms, what will continue to fuel the price appreciation in the long run?
I'm not very sure but here's some potential factors that will be positive for the home prices.
1. Inflation. All these years of Federal stimulus, cheap money might finally catch up to us.
2. Demographics. There's a significant increase in the population of 30-39 age group, prime age for household formation and first time home buying, starting now and won't peak until 2028. The demand for housing will increase significantly in the next decades due to increase of population.
3. Low inventory. Currently there's already a shortage of starter/low end homes, both existing or new builds nation wide. Builder just don't build many low end homes due to low profitability. And in Irvine, we are at the beginning of the end of new home constructions. In just about 10 more years, no more new builds. Entry level existing home in Irvine will be in even higher demands than today.
From my limited observation, here are a few things IHB missed or didn't account for regarding to Irvine housing after the housing bubble:
1. Interest rate drop by half, drop from mid 6% down to around 3.5% for 30 year fixed.
2. Investor buying frenzy. Investors of all type, individual, corporation, hedge funds snap up homes in the hundreds.
3. Misinterpret Irvine's household income. Income for the potential home buyers are more relevant than those of retiree, young single apartment renters, and college students. Irvine's average income is around $80k-$90k but I'm guessing the average household income of those new home buyers are twice of that.
4. FCB! There are significant increase of wealthy immigrants buying up properties after the housing bubble.
Now Irvine's home price are at all time high and we are facing numbers of head wind in the near terms, what will continue to fuel the price appreciation in the long run?
I'm not very sure but here's some potential factors that will be positive for the home prices.
1. Inflation. All these years of Federal stimulus, cheap money might finally catch up to us.
2. Demographics. There's a significant increase in the population of 30-39 age group, prime age for household formation and first time home buying, starting now and won't peak until 2028. The demand for housing will increase significantly in the next decades due to increase of population.
3. Low inventory. Currently there's already a shortage of starter/low end homes, both existing or new builds nation wide. Builder just don't build many low end homes due to low profitability. And in Irvine, we are at the beginning of the end of new home constructions. In just about 10 more years, no more new builds. Entry level existing home in Irvine will be in even higher demands than today.
YellowFever
New member
.
Yeah, builder need to build more entry level homes but definitely not the 1 bedroom product.
Housing inventory is at 18 years low. The demands are still very strong, only lack of inventory and high prices keep the sales down.
http://www.cnbc.com/2017/03/23/this-is-whats-behind-the-severe-housing-drought.html
Housing inventory is at 18 years low. The demands are still very strong, only lack of inventory and high prices keep the sales down.
http://www.cnbc.com/2017/03/23/this-is-whats-behind-the-severe-housing-drought.html