good, fuk this market

That’s called a “wholetail” deal or basically getting a retail deal (Little to no work needed, paint and carpet only) at a wholesale price

Even if it sells at 600k the investor likely has little to nothing into it so it’ll be a nice low risk profit for him in that example

Not bad, they should've built it closer to the trees instead of so far out. Any idea if they're even gonna keep the trees? I hate new development neighborhoods.

$4000 rent shouldn't be hard if your employer is paying the COL.

Like I've said a million times, landlords can only charge what the market will bear. If you're in a market like a lot of Canada and a lot of major cities in the US and overpaid significantly for your rental property, you might take a hit because you can't just charge whatever will cover your costs if you want to have renters. If your place is 20% more expensive than another place down the block, guess which one is getting rented?

And yes, being a landlord is a major PITA depending on the tenants - and even if you vet them properly, things can change. A lot of people can't be bothered assuming the risks and headaches.

Not gonna argue with you there. It is a major PITA.

As to your initial point, yeah people who did that made horrible business decisions.

If you are buying a rental property -- unless you are some huge REIT -- in a hyper inflated market you are a moron.

Yup the house has a two-level walkout to a full acre that extends to the tree line, which is the start of a nature reserve. It's an estate neighbourhood, so every lot is huge like this

Could put all kinds of stuff on the land between the house and the trees


Spoiler!

they just go under contract on a different house. It doesn’t add much inventory or any at all.

I track this chit weekly. People back out of contracts every single day. Once the summer markets ends, inventory will recede again.

Interests rates are the wildcard but even in the worst markets certain people have to buy and sell

The argument isn’t that backouts are new, it’s the percentage at which they’re occurring.

Since you track it, what is considered an average backout percentage?

6.9%

Hmm I was thinking it was 4.20%

What does it even matter when companies are coming in paying cash for houses at such a rate that for the 1st time in history, the rising interest rates might not even have an effect on the housing market.

I'm going to assume its three things:

-Lots of fear/uncertainly in where the market is heading. So people aren't ready to close.
-The belief that there will be a massive crash and they'll get a better deal.
-Interest rate hikes mean people can no longer afford the same houses they've been looking at/shopping for. I know someone during low rates who was approved for a 300K loan. Now they are ready to close but due to interest rate hikes they are only approved for a 200K loan. Nothing has changed financially for them. But with the higher interest rates their budget has been slashed by 100K.


I will say if interest rates spike massively and you are able to scoop up a nice house at a 50% discount or so. And interest rates drop in the future, you can always refinance at the lower rate. Having got a steep discount on a home and eventually getting that 30 year mortgage at a lower rate.


Personally I think interest rates have been too low which made the market go crazy. I'm just curious to see what happens when they hit 8-10%. Sure, home prices will drop. But the amount of house you'll be able to afford will be reduced dramatically. Unless you have a large down-payment or are a cash buyer good luck.

Even a 1% change in rate has such a massive impact on monthly payments

The fed will be going up 100 bps this month and probably 75 bps in August. When the fed increases by 75 bps, average interest rates went from 3.5% to 6-6.8%.

We’ll be at 10-11% mortgage rates by the end of the year.

Good point mentioning the bottom took a long time. There was a smaller national housing slump in the early 90s and it took I think 3 years for prices to bottom out. It's probably safe to say prices will be going down for a minimum of 2 years from now. All depends on how fast prices do go down. Whereas one of my neighbors got 10% above asking price last year my other neighbor trying to sell right now can't sell after a huge drop in asking price.

Renties gonna rent

Imagine sharing a wall with some random asshoel in 2022 lmao