How Long Do You Think It Will Be?

[Randolph Kinney]

Nashville-area rent down for first time in 7 years as housing market retracts
Aug. 26, 2018

Apartment rents in the Nashville area dropped in July after nearly seven years of continuous upward growth, and the for-sale housing market's sizzling post-recession prosperity chilled.

The slowdown is a welcome relief to renters and buyers weary of the seemingly boundless boom that has outpaced wages and rapidly inflated home prices to nearly double their 2012 values.

The downtrend is likely a market correction mirrored in cities across the nation, rather than the beginning of an economic slump.

https://www.tennessean.com/story/ne...e-7-years-housing-market-retracts/1056816002/

 

[Randolph Kinney]

Housing market could see shift to buyers market by 2020, according to report

Zillow says recent data suggest the balance may be starting to tilt back toward buyers. Home growth is slowing in more than half the nation’s 35 largest metros and price cuts are common.

Even in San Diego, where the cost of living is well above average, 20 percent of listings saw a price cut in June.

Three out of four economists surveyed say the national housing marked could see a shift to a buyer’s market by 2020.

Those same economists say the Midwest will be the first to see the shift, beginning as early as 2019, followed by the Northeast, South and West in 2020.

https://www.10news.com/news/making-...-to-buyers-market-by-2020-according-to-report

 

[Randolph Kinney]

You'd be better off renting than buying in many markets

Two separate studies are suggesting that many people may be better off renting than buying a home… or may not have a choice.

New analysis by realtor.com finds that the monthly costs of buying a home have risen 14% in the past year compared to an increase in rent of just 4%.

It also highlights that just 41% of the US population lives in a county where a median-household income can afford a median-priced home.

In July 2018, the median monthly cost to buy a home was $1,647, compared to the average cost to rent a home at $1,267.

"Even setting aside big upfront expenses like a down payment, rising month-by-month costs are likely keeping many people from purchasing," said Danielle Hale, chief economist at realtor.com.

While generating wealth is not everyone’s purpose for buying their own home, if it is then there may be better options according to another new study.

Florida Atlantic University and Florida International University faculty’s latest national Beracha, Hardin & Johnson Buy vs. Rent (BH&J) Index compares the wealth gained from rising equity for homeowners against those who rent a similar home and reinvest all the money they would have spent on ownership.

It found that in 16 of the 23 cities analyzed more wealth would be generated over a set period of time from renting and reinvesting rather than owning a home.

The last time the majority crossed into rent territory was in 1999 and since 2010 ownership has been in favor.

The index is based on averages and within a market there would be winners and losers but the index gives an indication of changing conditions compared to historic data.

Currently, Atlanta, Dallas, Denver, Honolulu, Houston, Kansas City, Los Angeles, Miami, Minneapolis, Philadelphia, Pittsburgh, Portland, San Diego, San Francisco, Seattle and St. Louis, are all in rent territory and all will be experiencing downward pressure on the demand for ownership.

https://www.mpamag.com/market-updat...nting-than-buying-in-many-markets-110170.aspx

No doubt about it, markets are peaking. With rising interest rates and monthly cost, it is more expensive in many major population areas to buy than people can afford.

 

[Randolph Kinney]

I told you so ...

 

[Joe Flacco]

I told you so ...

 

[Riick]

Going back to the original question, when, how long...
In late 2004 I took a job as a Staff Reviewer at an excellent salary, plus bonuses.
I figured the market would crash in 12-18 months, I'd be laid-off, nice cash payoff + unemployment insurance to boot.
The downturn and layoff didn't happen until the summer of '07, over a year past my best/worst case.
The Country didn't see/believe the poop was hitting the fan it until 2008.
Remember:
"The Market Can Remain Irrational Longer Than You Can Remain Solvent" - John Maynard Keynes