Where the market is - Buyer Offers

Raw materials some double and tripples in price. I know the supply chains and disruption occur since the trade war began under prez T,,,but at 200 % plus for lumbers, the basic building block for homes, that has to be suck big time for home buyers. We still very much rely on too many things from foreign country for many, many basic materials. This will drive not only homes cost, building cost, and many everydays items cost higher. I was NOT suprise by the move up. The only questions is. if we continue to live like Japan economy, will we last as long? They have been running and printing since 1990, with over 230 % GDP debt per year today. WOWZER, that's a long time and still going. I assume we will have the same trajectory.
 
Is there any alternative to Japan?? I don?t think so.  Once people get used to all of the freebies it?s tough to turn off the spigots. When the masses keep voting to get free stuff it?s a done deal. The government is a black belt at expanding and doesn?t know the meaning of contraction
 
Compressed-Village said:
Raw materials some double and tripples in price. I know the supply chains and disruption occur since the trade war began under prez T,,,but at 200 % plus for lumbers, the basic building block for homes, that has to be suck big time for home buyers. We still very much rely on too many things from foreign country for many, many basic materials. This will drive not only homes cost, building cost, and many everydays items cost higher. I was NOT suprise by the move up. The only questions is. if we continue to live like Japan economy, will we last as long? They have been running and printing since 1990, with over 230 % GDP debt per year today. WOWZER, that's a long time and still going. I assume we will have the same trajectory.
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Did you say that previously?
I think I was the only one on TI that talked about the farm subsidies in the billions or trillions. (Government giving money to farmers for not selling)
US tax cuts for business drove up the deficit like a crack add it. The top business still not paying fed income taxes. Plus the trade war negated the tax break.

 
qwerty said:
Is there any alternative to Japan?? I don?t think so.  Once people get used to all of the freebies it?s tough to turn off the spigots. When the masses keep voting to get free stuff it?s a done deal. The government is a black belt at expanding and doesn?t know the meaning of contraction
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The "Alternative", is when price reaches too high, an unpayable amount, which we will get there, it will stop and stagnate. Even if the FED able and willing to print more, the buying power is meaningless, since you cant buy much with the money that given out. Its like going to a buffet line. You can stuff all you want and after several plates you will slow down and stop. You got no more room for stuff. It gotta give one way or the other. Either, barf up or you know what....That inflation genie has broken out of the bottle.
 
Compressed-Village said:
Raw materials some double and tripples in price. I know the supply chains and disruption occur since the trade war began under prez T,,,but at 200 % plus for lumbers, the basic building block for homes, that has to be suck big time for home buyers. We still very much rely on too many things from foreign country for many, many basic materials. This will drive not only homes cost, building cost, and many everydays items cost higher. I was NOT suprise by the move up. The only questions is. if we continue to live like Japan economy, will we last as long? They have been running and printing since 1990, with over 230 % GDP debt per year today. WOWZER, that's a long time and still going. I assume we will have the same trajectory.
Click to expand...

No worries, the shortage of lumber (and therefore price increase) is caused by the pandemic and therefore is only temporary. Why? As the price of lumber actually dropped from 2018 to before the pandemic. After the economy opens, and production catches up, the lumber price will drop. 
 
talkirvine said:
Compressed-Village said:
Raw materials some double and tripples in price. I know the supply chains and disruption occur since the trade war began under prez T,,,but at 200 % plus for lumbers, the basic building block for homes, that has to be suck big time for home buyers. We still very much rely on too many things from foreign country for many, many basic materials. This will drive not only homes cost, building cost, and many everydays items cost higher. I was NOT suprise by the move up. The only questions is. if we continue to live like Japan economy, will we last as long? They have been running and printing since 1990, with over 230 % GDP debt per year today. WOWZER, that's a long time and still going. I assume we will have the same trajectory.
Click to expand...

No worries, the shortage of lumber (and therefore price increase) is caused by the pandemic and therefore is only temporary. How do I know? As the price of lumber actually dropped from 2018 to before the pandemic. After the economy opens, and production catches up, the lumber price will drop.
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Japan actually went through decades of depreciation, not inflation. Probably not the base case study if you're trying to demonstrate asset inflation.

The only things we are possibly tracking Japan, in terms of fiscal & monetary policy,  would be negative interest rate and blowing through the national debt.

Given the fact that we're already recovering, negative interest rate is unlikely to happen anytime soon.

So that leaves the national debt.

Japan has proven econ experts & conventional econ wisdom wrong for years by demonstrating that a large economy (#3 in the world) can sustain a high level of national debt even with virtually no GDP growth.  (over 250% debt to GDP ratio, negative GDP growth in the past decade)

This is on top of Japan having been on a steady population decline since 1998 & having one of the world's oldest population.

We don't have anywhere close to any of the above problems in the US.

Some people are freaking out over our national debt level, but the truth is we're barely over 100% debt to GDP ratio.

I think some proper context (Japan) should calm the anxiety.

Even though Japan has done QEs like we did, they spent a lot of their debt investing in infrastructures and its people. This is something we didn't do with our QEs.

If you look up various infrastructure scores and education scores, Japan has consistently ranked top in the developed world.

Their train and high speed rail systems are so top notch that approx. 85% of commuters in  Japan goes to work by Train. ( vs less than 5% in north America)

Austerity is unpopular and politically difficult. So yes, we're more likely to follow Japan's trajectory when it comes to the national debt.

Can we sustain Japan level of debt without investing in infrastructures, education etc is a valid question.

But to draw that parallel we are becoming Japan's economy is pre-mature. We have actual GDP growth, population growth, and the USD is still the global reserve currency.



 
we are in debt crisis due to the tax reform by trump and the Republican controllers Congress. Why are Republicans in Congress so concerned about the debt. The reformed Tax Bill that automatically put us in debt.
 
Put in an offer significantly over asking for 167 Stellar. List price $800k. Agent said they received 25 offers and are not countering any. Accepted top offer significantly over $900k.
 
USCTrojanCPA said:
Made an offer on this home earlier this morning for a buyer (the home got put on hold because they were only showing the home Fri-Sun).
https://www.redfin.com/CA/Irvine/65-Autumn-Sage-92618/home/45376607
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The seller ended up accepting our strong offer and not sending out best & final counters despite there being 5 other offers on the table.  I have worked with the listing agent on a few other very smooth transactions in the past few years so I'm sure that helped my client's offer as well.
 
Cares said:
Put in an offer significantly over asking for 167 Stellar. List price $800k. Agent said they received 25 offers and are not countering any. Accepted top offer significantly over $900k.
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Two level 3bd detached condo listed at $800k, way under $500/sf?  That was under listed to get things done quickly.
 
USCTrojanCPA said:
USCTrojanCPA said:
Made an offer on this home earlier this morning for a buyer (the home got put on hold because they were only showing the home Fri-Sun).
https://www.redfin.com/CA/Irvine/65-Autumn-Sage-92618/home/45376607
Click to expand...

The seller ended up accepting our strong offer and not sending out best & final counters despite there being 5 other offers on the table.  I have worked with the listing agent on a few other very smooth transactions in the past few years so I'm sure that helped my client's offer as well.
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Congrats. My buyers were interested in this home but this was definitely out of their budget even at list price. These are the buyers that are hoping to find homes below list price  :(
 
I'd say it depends more on the on the buyer than the Agent. There are some buyers who want to see 1,000 homes and write 1,000 unrealistic offers. A good Agent spots them somewhere between the 10th and 15th offer that's presented and failed. At that time the difficult "I don't see us working out.... it's not you, it's me" kind of break up conversation happens.

There are some buyers who want to see 100 homes and write 100 solid offers but continue to get beat out by cash or other factors. The good Agents usually keep these buyers and continue to write offers for them. These kind of buyers will eventually be successful, close a home, and refer a wide number of friends and family who often yield even more quality referrals. This buyer may have taken 100 offers to succeed, but their referral might only take 1 or 2 to be successfully under contract to buy/sell.

Good Agents don't see a buyer for what it is right here and now in front of them, but look down the line behind the present buyer towards their long term referral potential.

My .02c
 
Looks like The New Home Company, at least in NorCal doesn't want to go the route of bidding for new releases. Curious to see if it is a company wide policy or just local.
 

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