Housing Bubble?

[Joe Flacco]

Yes very mixed

Mixed how? What do you see ?

 

[shrubberyvaluation]

Mixed how? What do you see ?

Some increasing significantly with 10-20% over list price for subject and comps, some areas relatively stable.

 

[J Grant]

Imo, a housing bubble is not just about high prices. It is about Real estate that people can not afford - either to buy or to own.
Buying a house is one thing, and affording the payments, plus taxes and insurance and repairs, is another. Infrastructure rates are skyrocketing, houses, as they age, need repairs, and RE taxes have doubled in many areas. I see more houses showing delinquent taxes and more RE deals trading between LLC corporations and brokers to each other - the kind of thing that went on pre-bust the last cycle.

Clearly, there is a segment of well-heeled buyers who can afford the high prices and also those buying all cash.

But the market needs all kinds of buyers, and many are simply priced out of the market -esp considering all the costs, not just the prices .

Monthly condo fees here in Florida have almost doubled over the last 3 years.

 

[Terrel L. Shields]

Housing bubble? Prices haven't really gone up in past few years.
If it did in your area, I'll be worried.

NWA has remained steadily increasing at 4-5% annual. NE OK not so much.

he high end over $4 million homes are not increasing as much. Terrible.

Outside the NY and CA, where are there many 4 mil houses?

The problem is price. I am appraising 6 new construction - mix of 3 and 2 bed homes from 840 -1,100 SF. in a small rural town. They have built 4 and sold them all for $135,000 plus minus, 840 SF. Brand new, minisplit HA system, laminate vinyl floors, 1.5 bathrooms, DW, RO, MW, and REF as well. Metal roof, metal siding. The builder has 3 more under construction and now proposes six more that will be 3 bed and 2 bed models. The average DOM for the town is 107 days. The average for the houses sold is about 40 days. Most under contract within 10 days. A couple are pending.

These are utilitarian, livable, and most of all, affordable housing. Where else do you find a house under $150k that is new?

 

[Non Sequitur]

I agree with most of this article, and a few posts touched on this. IMO if we see a 2008 crash it will likely be caused by insurance and to a lesser extent property taxes:

"Insurance executives, economists, actuaries, and scientists have testified to the Senate Budget Committee that as underinsurability rises, property values in affected markets will decline, insurance unavailability will cause affected properties to become unmortgageable, and the “wide-scale decline in coastal and wildland-urban interface community property values would present a systemic risk to the U.S. economy, similar to what occurred in the 2007-2008 mortgage meltdown,” according to publicly available documents."

"The looming mortgage crisis will be worse than 2008, says Ted Tozer, former president of the government issuer, Ginnie Mae, from 2010 to 2017. “Underinsured foreclosures will dwarf the foreclosures during the housing crisis in low-wealth communities,” says the non-resident fellow at the Urban Institute’s Housing Finance Policy Center and board member for PennyMac Financial Services, a major U.S. correspondent lender and mortgage servicer."

Homeownership Is Underwater, Up In Flames, Or In The Wind

nationalmortgageprofessional.com

 

[TerryRohrer]

“wide-scale decline in coastal and wildland-urban interface community property values would present a systemic risk to the U.S. economy, similar to what occurred in the 2007-2008 mortgage meltdown,”

Unfortunately, government involvement in everyone's daily life ensure this outcome, which then insures further government actions to maintain power and secure future votes by protecting the losers, which further ensures that everyone will continue to take these risks which increase the systemic risks to all, etc, etc, etc. The only solution is to make a long term commitment to get government out of the social engineering and disaster exoneration business and let people make their own decisions and deal with the consequence of their own decisions. About as likely to happen as appraisers being in charge of the country during the next four years!

 

[Bobby Bucks]

I agree, but are current market conditions normal? While inventory is moving in my market it’s slow and I doubt could handle more new spec builds. What’s missing for the spec market is the trade up buyers, they aren’t buying right now.

The battle axes I talk to say the trade up buyers aren't' in a hurry to move anywhere. If they have a 3% mortgage, the keeping up with the Jones and envy won't work this cycle. No amount of graph and corruption from our elected leaders in DC appears to be on the way either. One thing is clear regarding potential bubbles, Doctor Horton, the nations largest Q5 builder is making more deals than on the lot financing shady used car dealers.

 

[alebrewer]

North Texas is still fairly strong, L/S ratios are getting a bit wider (maybe ~ 1-2%), and DOM crept up last January, but is holding fairly steady currently. New home inventory in D/FW has started to drop just a bit after a peak in October.

 

[Joe Flacco]

Metro area stats are masking pockets of significant weakness. We will see how the situation changes as it happens.

 

[Joe Flacco]

I don't know what will happen with insurance impact on value but it is probably good for areas without natural disasters and bad for places with risk of natural disasters. Look at the outer banks properties. Dirt cheap ocean front properties.