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27 minutes ago, The Z Machine said:

Plenty of vacant houses here in Baltimore!  Make this city full again. 

But then you would have to live in Baltimore. 

Movement has been out of cities with so many more people able to work from anywhere now and the chaos in many cities due to COVID, civil unrest and rising crime. 

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I’m officially a homeowner. Just closed.  2.75%, 15 years.  🥳

Just made my last mortgage payment yesterday!!!  I am free and clear!

If you guys would allow me to vent... I need to vent a bit... I could vent to other LO's who all know it and they just smile and nod (somehow that doesn't really feel like venting) or my wife but with

2 minutes ago, Capella said:

:lmao: what

There has been an exodus out of many large US cities. From talking to people making these decisions and talking to other lenders, these are the reasons people are citing. Also cited is going from high to low tax areas, affordability/standard of living and in sometimes weather depending on the city. 

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2 hours ago, stbugs said:

I just don’t get it. I don’t think there is a house in my neighborhood for sale but I’ve heard about other closer neighborhoods going crazy.

 

It's nuts and finally hit close to home.

One neighbor sold his house a few months ago for about 30% more than he paid 4 years ago, my other neighbor just listed his house Wednesday, which took 18 months to sell 3 years ago, for $150k more ($450k), $140/sq ft, and he's had a parade of potential buyers. It helps that our school district is great, our neighborhood is fairly small and cost around $20 less per ft² than comparable neighborhoods

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14 minutes ago, Chadstroma said:

There has been an exodus out of many large US cities. From talking to people making these decisions and talking to other lenders, these are the reasons people are citing. Also cited is going from high to low tax areas, affordability/standard of living and in sometimes weather depending on the city. 

Show me any quantitative data that shows people are leaving big cities due to social protests or riots. That’s patently absurd. 

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4 hours ago, stbugs said:

I just don’t get it. I don’t think there is a house in my neighborhood for sale but I’ve heard about other closer neighborhoods going crazy.

I know the stock market and crypto markets have created a lot of wealth but why the sudden gotta move and pay a load of cash? I know people were moving from cities during the pandemic but why all of a sudden some sort of gold rush now?

Reminds me of 2000-2005 when house prices exploded and then crashed. I don’t see how this ends well once the lumber shortage goes away and builders start actually making new houses.

They've been making new houses for the last six years now and can't catch up.

The US is 4 millions homes short of what is needed. This isn't going to correct until this is fixed.

Think of it like the foreclosure problem in reverse. It took the worst markets like FLA, Vegas, etc five years to correct from that. It could take five years to correct from this.

I'm up to three dozen legit reasons why people are moving right now.

Edited by Getzlaf15
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In the Bay Area, people are leaving San Francisco and other metropolitan/downtown areas for everything from nearby suburbs to the nearby mountains (Tahoe) to out-of-state locations. If you live in San Francisco, you likely live in an apartment or condo, and the thought of living there while changing to WFH is probably not that attractive. Just not a lot of square footage, and if you're in a relationship, it's even tighter. Not a lot of homes in SF, and those that are there are coin. There's also a ton of money here. Salesforce, Uber, AIRBNB, Snowflake, etc. has made a lot of millionaires able to put giant down payments on homes, if not pay all cash. What was $800/sf two years ago is now going for $1,200/sf. It's insane. And the impact is not localized. COVID, along with the Bay Area economy, has impacted all of northern California and probably southern too. 

My friends - personal and work - and I talk about what's going on pretty frequently. We think we're in the midst of a cultural change. I'm not convinced age groups will embrace whatever they embraced two years ago. 

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2 minutes ago, Getzlaf15 said:

They've been making new houses for the last six years now and can't catch up.

The US is 4 millions homes short of what is needed. This isn't going to correct until this is fixed.

Think of it like the foreclosure problem in reverse. It took the worst markets like FLA, Vegas, etc to correct from that. It could take five years to correct from this.

I'm up to three dozen legit reasons why people are moving right now.

Many people prefer houses but apartments with good living, walkable areas are the solution here. We've been getting more of those but not enough. 

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5 hours ago, Capella said:

Our market is so heated I can’t help but wonder about selling and just renting a place for a few years to see if this cools off (my wife would murder me and never allow this). Our place is is worth 150-175k more than what we paid for it 2 years ago. A house went on the market Friday and was gone Saturday by noon. 

I have a client looking to upgrade.  Last August, his comps on his home were at $290. Last week, they were at $410.

I sold my home 10 days ago. It appraised at $415, 25 months ago. Got $670.  Sold a rental 3 weeks ago that I had 2.5 years.  Paid $252, sold for $455.

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Just now, -OZ- said:

Many people prefer houses but apartments with good living, walkable areas are the solution here. We've been getting more of those but not enough. 

About five years, they started building 200-400 unit complexes again here in the Boise area. They are fully rented before they are even finished.  The rental market is slightly worse than the housing market IMO.

Even heard this affecting car sales. Not enough used cars for sale. I some places, they are going higher than new cars. Just crazy. 

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4 minutes ago, Getzlaf15 said:

I have a client looking to upgrade.  Last August, his comps on his home were at $290. Last week, they were at $410.

Sheesh 

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1 minute ago, Capella said:

Sheesh 

These place have gone up so much, I now have three old buyers looking to upgrade and use their equity as a huge down and leave $50k out for trips and fixing up new place.

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2 minutes ago, Getzlaf15 said:

These place have gone up so much, I now have three old buyers looking to upgrade and use their equity as a huge down and leave $50k out for trips and fixing up new place.

The thought has crossed my mind but we have enough house I guess. 

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10 minutes ago, DEADHEAD said:

 

My friends - personal and work - and I talk about what's going on pretty frequently. We think we're in the midst of a cultural change. I'm not convinced age groups will embrace whatever they embraced two years ago. 

I think you're right on this. With WFH going up from 25% before COvid to 42% now and rising, people are choosing where they want to live. Be it family, affordability, lifestyle or all of the above. 

Baby boomers are down sizing into smaller places. Boomers are dying and leaving generational wealth to their kids.

There are so many forces all at once happening.  This is not a bubble. This is supply and demand.  A bubble is wild speculation. That's what happened in 2006 when inventory was 10-15x higher than now.

And Cap, the loans now are super strict.  Underwriters have 1/3 of their files audited these days. I just spent a week doing stupid stuff (5 items) for the underwiter that had notjing to do with my ability to pay, and everything to do with him keeping his job if audited.

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1 minute ago, Capella said:

So what happens say 5 years from now when (if??) things settle down? Prices revert backward some or is this the new baseline?

IMO, new baseline like the early 80's did.

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19 minutes ago, Getzlaf15 said:

I have a client looking to upgrade.  Last August, his comps on his home were at $290. Last week, they were at $410.

I sold my home 10 days ago. It appraised at $415, 25 months ago. Got $670.  Sold a rental 3 weeks ago that I had 2.5 years.  Paid $252, sold for $455.

Wow, that's some serious appreciation. 

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18 minutes ago, Getzlaf15 said:

Even heard this affecting car sales. Not enough used cars for sale. I some places, they are going higher than new cars. Just crazy. 

That's due to both demand (lots of stimmybux) and supply (IC chip shortages) and plant shutdowns.

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1 minute ago, The Z Machine said:

Wait till we start seeing 40 year mortgages with these new prices.

$300k loan, 30 years, 3.25 is $1306.  40 years is $1118.   

Not sure I'd pay extra 10 years for only  $188 off.  But maybe we will see more of them.  Interesting.

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I built my house in 2007. All-in for about $160,000. Family land so that was free.

Refinanced twice, last time was a few years ago. House appraised for $280k. Last year we got an open line of credit (which we haven’t used due to lumber prices) and the house appraised for $250k ( the guy was an idiot but I didn’t care because it appraised for more than enough). Now comps near me are in the 450 to 500k range. Pretty sure I could get more. The problem is where would I go? Can’t build because costs are stupid high, can’t upgrade because prices are stupid high. 
 

I feel like I should be cashing out but have no options currently besides renting, and that market is over saturated too.

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5 minutes ago, Cold Dead Hands said:

I built my house in 2007. All-in for about $160,000. Family land so that was free.

Refinanced twice, last time was a few years ago. House appraised for $280k. Last year we got an open line of credit (which we haven’t used due to lumber prices) and the house appraised for $250k ( the guy was an idiot but I didn’t care because it appraised for more than enough). Now comps near me are in the 450 to 500k range. Pretty sure I could get more. The problem is where would I go? Can’t build because costs are stupid high, can’t upgrade because prices are stupid high. 
 

I feel like I should be cashing out but have no options currently besides renting, and that market is over saturated too.

Likely the #1 reason for lack of inventory is people don't feel comfortable in finding a new place that works for them. So they just stay put.

Builders here refuse to accept contingent offers because they can.

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13 minutes ago, Getzlaf15 said:

$300k loan, 30 years, 3.25 is $1306.  40 years is $1118.   

Not sure I'd pay extra 10 years for only  $188 off.  But maybe we will see more of them.  Interesting.

That's not the equivalent. What's the principle for the $1306 at 40 years?

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11 minutes ago, Cold Dead Hands said:

I feel like I should be cashing out but have no options currently besides renting, and that market is over saturated too.

Yup. That's where most people are too I bet.  But rents have gone down in historically expensive markets, while sales prices have gone up.

Another phenomenon might be that areas that had seen huge gains in the last 10 years (think SF, NYC) aren't seeing the same increases as areas that didn't see those gains (think Nashville, Charlotte, etc.)

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4 minutes ago, The Z Machine said:

Yup. That's where most people are too I bet.  But rents have gone down in historically expensive markets, while sales prices have gone up.

Another phenomenon might be that areas that had seen huge gains in the last 10 years (think SF, NYC) aren't seeing the same increases as areas that didn't see those gains (think Nashville, Charlotte, etc.)

I was all set to build a two car garage addition with a second floor master bedroom, but costs skyrocketed. One year ago I priced everything out with me doing the majority of the work for $40k. Got the line of credit and prices went up, I figured I would wait for it to stabilize. Now? Prices out at $74k, and that was with significant design changes. #### that noise.

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1 hour ago, Capella said:

Show me any quantitative data that shows people are leaving big cities due to social protests or riots. That’s patently absurd. 

I am not going to go this direction. 

I am telling you what I am hearing and getting from other lenders that actually deal with people. 

You can disagree. You can research it and show me I am wrong. You can take your agenda and run with it from there. I don't care.

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1 hour ago, culdeus said:

Building materials are insane right now.  Makes a used home a lot more affordable than a new one.  That's one of a few reasons

Yeah, but we are seeing $150-200k price increases on houses where materials might cause a $30-50k increase.

55 minutes ago, Chadstroma said:

Inventory. Everything is tied to Inventory. Very little new construction and very few people are selling.

If everyone is still working from home and inventory is really low why are people this insane to bid way over what the house was worth 6 months ago? I just don’t get it. How many people truly “need” to move? I’ve been looking at lake houses recently and they’ve jumped as well, more so lately than early in the pandemic. I’m just going to wait for a few years and see if it implodes. Hopefully, won’t hurt my house value too much but I do think people will be migrating back and I do think prices will drop. It feels so much like the last housing crisis in terms of the appreciation being well above normal. Not the same bad loans but this time it’s IMHO temporary material/inventory shortages due to COVID.

It will be interesting. Unless you are downsizing or moving to a place that’s not going crazy, it almost doesn’t matter because the next house would have jumped as well.

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45 minutes ago, Capella said:

So what happens say 5 years from now when (if??) things settle down? Prices revert backward some or is this the new baseline?

It all depends on supply and demand. But rising interest rates will put a brake on things. We were certainly going that direction and things settled back with lower rates. The trajectory should be higher rates though and that will diminish purchasing power. On the other end, higher inflation will make those dollars worth less. There are a lot of factors that push and pull on all this. 

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41 minutes ago, The Z Machine said:

Wait till we start seeing 40 year mortgages with these new prices.

Unlikely to be a big factor. They are by definition outside the QM box (qualified mortgage) so the rates would be significantly higher over conventional and govies. That also means higher down % requirements. Finally, I am not sure there would be much investor appetite for them.

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2 minutes ago, stbugs said:

Yeah, but we are seeing $150-200k price increases on houses where materials might cause a $30-50k increase.

If everyone is still working from home and inventory is really low why are people this insane to bid way over what the house was worth 6 months ago? I just don’t get it. How many people truly “need” to move? I’ve been looking at lake houses recently and they’ve jumped as well, more so lately than early in the pandemic. I’m just going to wait for a few years and see if it implodes. Hopefully, won’t hurt my house value too much but I do think people will be migrating back and I do think prices will drop. It feels so much like the last housing crisis in terms of the appreciation being well above normal. Not the same bad loans but this time it’s IMHO temporary material/inventory shortages due to COVID.

It will be interesting. Unless you are downsizing or moving to a place that’s not going crazy, it almost doesn’t matter because the next house would have jumped as well.

There are a lot of people that need to move.  Most likely job loss and/or new employment. 

It's like a sno-globe out there right now and I think the shaking is finally starting to slowing down, but not yet stopped.

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32 minutes ago, Cold Dead Hands said:

I built my house in 2007. All-in for about $160,000. Family land so that was free.

Refinanced twice, last time was a few years ago. House appraised for $280k. Last year we got an open line of credit (which we haven’t used due to lumber prices) and the house appraised for $250k ( the guy was an idiot but I didn’t care because it appraised for more than enough). Now comps near me are in the 450 to 500k range. Pretty sure I could get more. The problem is where would I go? Can’t build because costs are stupid high, can’t upgrade because prices are stupid high. 
 

I feel like I should be cashing out but have no options currently besides renting, and that market is over saturated too.

And this sums up why people are not selling 

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7 minutes ago, Getzlaf15 said:

$350,500

So that would mean a 16.7% increase in price if people move to a 40 year note.

For what it's worth, if prices continue to rise like this without commensurate salary increases, lots of places will price out working families and those without generational wealth.

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6 minutes ago, stbugs said:

Yeah, but we are seeing $150-200k price increases on houses where materials might cause a $30-50k increase.

If everyone is still working from home and inventory is really low why are people this insane to bid way over what the house was worth 6 months ago? I just don’t get it. How many people truly “need” to move? I’ve been looking at lake houses recently and they’ve jumped as well, more so lately than early in the pandemic. I’m just going to wait for a few years and see if it implodes. Hopefully, won’t hurt my house value too much but I do think people will be migrating back and I do think prices will drop. It feels so much like the last housing crisis in terms of the appreciation being well above normal. Not the same bad loans but this time it’s IMHO temporary material/inventory shortages due to COVID.

It will be interesting. Unless you are downsizing or moving to a place that’s not going crazy, it almost doesn’t matter because the next house would have jumped as well.

Because they put 10 offers on other houses and got blown out by others. 

There is a tik tok that perfectly describes markets right now. 

I posted it in my credit score FB group...

https://www.facebook.com/watch/?v=366364668023681

 

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Just now, Chadstroma said:

Because they put 10 offers on other houses and got blown out by others. 

There is a tik tok that perfectly describes markets right now. 

I posted it in my credit score FB group...

https://www.facebook.com/watch/?v=366364668023681

 

I've heard so many crazy buyer stories the last few months.

Buyers are fatigued and burned out. I've heard many times of them coming in $50k over on a $350k home and losing 5-10 times.  So they just buck up, wait to the last second to offer, and come in $70-100k over.

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26 minutes ago, Chadstroma said:

I am not going to go this direction. 

I am telling you what I am hearing and getting from other lenders that actually deal with people. 

You can disagree. You can research it and show me I am wrong. You can take your agenda and run with it from there. I don't care.

So you want me to prove a negative? That doesn’t even make sense. 
 

I have no agenda at all. You’re the one who dropped that nonsense in your post with nothing but anecdotal statements to back it up. 
 

But I’ll drop it after this as it’s a waste of time. 

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Just now, Capella said:

So you want me to prove a negative? That doesn’t even make sense. 
 

I have no agenda at all. You’re the one who dropped that nonsense in your post with nothing but anecdotal statements to back it up. 

Normally, I give anecdotal evidence an eye roll and move on. I think in this case anecdotes that originate from actual sellers/buyers to actual lenders/realtors is valid data. People move out of urban areas for a lot of reasons, many times each individual was influenced by many factors. So, yes, they may be leaving for QoL, costs, taxes, jobs as the primary factor, but I would have to think that those other things are a back of the mind factor as well.

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24 minutes ago, Chadstroma said:

I am not going to go this direction. 

I am telling you what I am hearing and getting from other lenders that actually deal with people. 

You can disagree. You can research it and show me I am wrong. You can take your agenda and run with it from there. I don't care.

 

3 minutes ago, Capella said:

So you want me to prove a negative? That doesn’t even make sense. 
 

I have no agenda at all. You’re the one who dropped that nonsense in your post with nothing but anecdotal statements to back it up. 

Gentlemen...why don't we move on to a topic we can agree about such as why the lack of appreciation of my Amazon stock is preventing me from being able to afford a home.

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Just now, BassNBrew said:

 

Gentlemen...why don't we move on to a topic we can agree about such as why the lack of appreciation of my Amazon stock is preventing me from being able to afford a home.

Yea, moving on. 

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6 minutes ago, Capella said:

I’m actually moving because it’s too boring here. 

Amazon will due that to you. Most boring stock ever.

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9 minutes ago, BassNBrew said:

 

Gentlemen...why don't we move on to a topic we can agree about such as why the lack of appreciation of my Amazon stock is preventing me from being able to afford a home.

Really my only laggard is my UWM stock right now but U am still long hold on it. 

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