Housing about to Blowup
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quattroporte
New member
It was built in 2013, so it couldn't have been bought in 2012.
zubs
Well-known member
Irvine is back to the bubble prices of 2006, but it's been 7 years, and these past 7 years have seen extraordinary money printing, so once again let me point out that the $1 million home in 2006 and a $1 million home in 2013 is nominally the same, but really isn't.
If you take the $1million and put it into an an ultra safe investment say at 2%, after 7 years it would be $1,148,685.50.
If the official rate of inflation is 2%, then the $1,000,000 home in 2006 should be $1,148,685.50 to be equivalent today.
If you take the $1million and put it into an an ultra safe investment say at 2%, after 7 years it would be $1,148,685.50.
If the official rate of inflation is 2%, then the $1,000,000 home in 2006 should be $1,148,685.50 to be equivalent today.
morekaos
Well-known member
Cauldron of hawks emerges on Fed policy committee
http://www.cnbc.com/id/100978883
The hawkish position is still in the minority?a few hawks versus a number of doves. But there is now clearly a gang of hawks at the FOMC meeting. Or, as the bird people would say, we've got a cauldron of hawks at the Fed.
And...
Wells Fargo eliminates 2,300 mortgage jobs
http://www.cnbc.com/id/100979154
The company expects the pace of mortgage lending to slow for the remainder of the year as higher interest rates cut into the demand for refinancing.
Applications for U.S. home loans fell for a second straight week as higher interest rates reduced refinancing activity, an industry group reported Wednesday.
http://www.cnbc.com/id/100978883
The hawkish position is still in the minority?a few hawks versus a number of doves. But there is now clearly a gang of hawks at the FOMC meeting. Or, as the bird people would say, we've got a cauldron of hawks at the Fed.
And...
Wells Fargo eliminates 2,300 mortgage jobs
http://www.cnbc.com/id/100979154
The company expects the pace of mortgage lending to slow for the remainder of the year as higher interest rates cut into the demand for refinancing.
Applications for U.S. home loans fell for a second straight week as higher interest rates reduced refinancing activity, an industry group reported Wednesday.
morekaos
Well-known member
The dancers assemble at the edge of the floor....
http://finance.yahoo.com/news/us-home-sales-plunge-mortgage-140858412.html
US new-home sales plunge as mortgage rates rise
US new-home sales plummet 13.4 pct. in July to lowest level in 9 months as mortgage rates rise
WASHINGTON (AP) -- Americans cut back sharply in July on their purchases of new homes, a sign that higher mortgage rates may weigh on the housing recovery.
The Commerce Department said Friday that new-home sales dropped 13.4 percent to a seasonally adjusted annual rate of 394,000. That's the lowest pace in nine months. And it is down from an annual rate of 455,000 in June, which was revised sharply lower from a previously reported rate of 497,000.
New-home sales have risen 7 percent in the 12 months ending in July. The annual pace remains well below the 700,000 that is consistent with a healthy market.
http://finance.yahoo.com/news/us-home-sales-plunge-mortgage-140858412.html
US new-home sales plunge as mortgage rates rise
US new-home sales plummet 13.4 pct. in July to lowest level in 9 months as mortgage rates rise
WASHINGTON (AP) -- Americans cut back sharply in July on their purchases of new homes, a sign that higher mortgage rates may weigh on the housing recovery.
The Commerce Department said Friday that new-home sales dropped 13.4 percent to a seasonally adjusted annual rate of 394,000. That's the lowest pace in nine months. And it is down from an annual rate of 455,000 in June, which was revised sharply lower from a previously reported rate of 497,000.
New-home sales have risen 7 percent in the 12 months ending in July. The annual pace remains well below the 700,000 that is consistent with a healthy market.
Irvinecommuter
New member
shadax said:
Someone talked about the TIC having the perfect timing...they are transitioning out just when other builders are coming back in. Builders will just hold off on building if the market falls.
morekaos
Well-known member
morekaos said:
http://www.cnbc.com/id/100993579
Home sales suffer on higher rates: Realtors
Signed contracts to buy existing homes faltered in July, as home buyers faced significantly higher interest rates along with rising home prices. The pending home sales index from the National Association of Realtors fell 1.3 percent from June but is still 6.7 percent higher than July 2012. These contracts indicated lower home sales closings in August and September.
morekaos
Well-known member
Mr. Feldstein agrees with me...
US Interest Rates Will Continue to Rise
http://www.project-syndicate.org/commentary/the-sources-of-upward-pressure-on-us-interest-rates-by-martin-feldstein
CAMBRIDGE ? Six months ago, I wrote that long-term interest rates in the United States would rise, causing bond prices to fall by so much that an investor who owned ten-year Treasury bonds would lose more from the decline in the value of the bond than he would gain from the difference between the bonds? interest rate and the interest rates on short-term money funds or bank deposits.
That warning has already proved to be correct. The interest rate on ten-year Treasury bonds has risen almost a full percentage point since February, to 2.72%, implying a loss of nearly 10% in the price of the bond.
But what of the future? The recent rise in long-term interest rates is just the beginning of an increase that will punish investors who are seeking extra yield by betting on long-term bonds. Given the current expected inflation rate of 2%, the real rate on ten-year bonds is still less than 1%. Past experience implies that the real rate will rise to at least 2%, taking the total nominal interest rate to more than 4%, even if expected inflation remains at just 2%.
US Interest Rates Will Continue to Rise
http://www.project-syndicate.org/commentary/the-sources-of-upward-pressure-on-us-interest-rates-by-martin-feldstein
CAMBRIDGE ? Six months ago, I wrote that long-term interest rates in the United States would rise, causing bond prices to fall by so much that an investor who owned ten-year Treasury bonds would lose more from the decline in the value of the bond than he would gain from the difference between the bonds? interest rate and the interest rates on short-term money funds or bank deposits.
That warning has already proved to be correct. The interest rate on ten-year Treasury bonds has risen almost a full percentage point since February, to 2.72%, implying a loss of nearly 10% in the price of the bond.
But what of the future? The recent rise in long-term interest rates is just the beginning of an increase that will punish investors who are seeking extra yield by betting on long-term bonds. Given the current expected inflation rate of 2%, the real rate on ten-year bonds is still less than 1%. Past experience implies that the real rate will rise to at least 2%, taking the total nominal interest rate to more than 4%, even if expected inflation remains at just 2%.
homer_simpson
Well-known member
Well it makes sense.. High end home buyers rarely need loans...
sgip
Well-known member
Are you buying as an investment or as a place to live? If you're worried about losing value on a property - a very natural concern - that's only part of the bigger picture. If prices fall, will you get the house you want in the area you had hoped to live in, with a floor plan you prefer or will you have to duke it out with all cash buyers and investors who see a great deal? No one wants to invest in a dud, but it's so difficult to tell when the right time to buy is, so many buyers simply get analysis paralysis and do nothing as the market continues to shift away from them.
Buy when it makes sense to do so for your particular needs. If it's simply a case of ROI, I'd wait given how much uncertainty there seems to be in prices, inventory, and rates.
My .02c
Buy when it makes sense to do so for your particular needs. If it's simply a case of ROI, I'd wait given how much uncertainty there seems to be in prices, inventory, and rates.
My .02c
usctrojancpa
Well-known member
If you intend to live in the home for more than 3-5 years then I think it's fine to buy now. Currently the market is flat to slightly up (weak seller's market). Inventory levels have come down recently from the high 500s to 550 as of today with August having just under 250 closings.irv81 said:
Irvinecommuter
New member
Soylent Green Is People said:
In the end...it is about your life stage and what you can afford. If you can't realistic afford it, don't do it.
morekaos
Well-known member
Numbers, numbers, numbers...wadda ya gonna do?
Yep, it's another housing bubble
http://www.cnbc.com/id/101019905
Four months ago something troubling happened in the housing market. The home price affordability index tracked by the National Association of Realtors slipped below it's long-term trend line, marking a possible beginning of a housing bubble.
On Monday, we got the fourth month of home affordability data coming in below trend, which is a strong confirmation that the housing market is once again in a bubble. (The NAR index is published with a two-month delay, so the latest numbers are for July).
Yep, it's another housing bubble
http://www.cnbc.com/id/101019905
Four months ago something troubling happened in the housing market. The home price affordability index tracked by the National Association of Realtors slipped below it's long-term trend line, marking a possible beginning of a housing bubble.
On Monday, we got the fourth month of home affordability data coming in below trend, which is a strong confirmation that the housing market is once again in a bubble. (The NAR index is published with a two-month delay, so the latest numbers are for July).