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Forum » Will rising interest rates crash this RE market?
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Thread: Will rising interest rates crash this RE market?

post 1659213173 04-06-2022, 11:46 AM
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Will rising interest rates crash this RE market?

Every leading industry expert says no. Housing will continue to increase in price because reasons. Some popular reasons:

Millenial demand

Gen Z Demand

Boomer retirement demand

Of course, this ignores the fact that population increase is a continual linear function and the marked increase in price of 2020 was a non linear movement. We can clearly ascertain characteristically that market prices are forced from conditions starting in 2020....correlating massively with low fed interest rates and covid panic....nevermind the obvious fact that the recent 2% increase in mortgage rates correlates to a 25% increase in payment...Prices can't go down! Demand is magic and sticky!

But 10/10 experts agree! BTW, they work in industry so they're experts and are objective/unbiased! They don't need supporting data, they're on the frontlines!

https://www.google.com/search?q=hous...hrome&ie=UTF-8
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post 1659213423 04-06-2022, 11:49 AM
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Endgoal here is to make everyone born after 1990 renters
post 1659213613 04-06-2022, 11:51 AM
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Remember that rising rates only affect us plebs and the tribe investment firms aren’t affected one bit
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post 1659213653 04-06-2022, 11:52 AM
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Originally Posted By OffwhiteBrah⏩
Endgoal here is to make everyone born after 1990 renters
but its the individuals themselves driving the prices up

I've not seen any evidence to suggest large firms are buying more RE than normal. I keep asking for data and it never manifests.
Originally Posted By ThatGuy950⏩
Remember that rising rates only affect us plebs and the tribe investment firms aren’t affected one bit
two factors count against that perspective:

1) they still borrow and if bonds yield similar than RE they'll take the bonds as they're lower volatility. Bonds are raising rates with fed.

2) I'm not sure they're that much of the market.
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post 1659213703 04-06-2022, 11:54 AM
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Originally Posted By rectifryer⏩
but its the individuals themselves driving the prices up

I've not seen any evidence to suggest large firms are buying more RE than normal. I keep asking for data and it never manifests.
read an article the other day discussing percent of RE bought by investment firmst and it was up a little bit over normal but it wasn't much. Didn't even appear to be statistically significant to me.
post 1659213743 04-06-2022, 11:54 AM
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Originally Posted By Retoaded⏩
read an article the other day discussing percent of RE bought by investment firmst and it was up a little bit over normal but it wasn't much. Didn't even appear to be statistically significant to me.
yeah but appearances and statistics can be deceiving, so I'm certainly open to hearing the case.

I've seen invitation homes come in locally and buy every other house for a few months then stop. Its like they were 50 % of local sales for a two months of the year, so about 8% overall. That seems to excite the market mind you but only for a short time. They've since stopped.
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post 1659213883 04-06-2022, 11:56 AM
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What states have the lowest property tax so that I can scoop up some land and hold it?
post 1659213973 04-06-2022, 11:57 AM
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Originally Posted By rectifryer⏩
but its the individuals themselves driving the prices up

I've not seen any evidence to suggest large firms are buying more RE than normal. I keep asking for data and it never manifests.



two factors count against that perspective:

1) they still borrow and if bonds yield similar than RE they'll take the bonds as they're lower volatility. Bonds are raising rates with fed.

2) I'm not sure they're that much of the market.
I have to agree with point 2 actually, at least to a degree. I think some of that has been overstated lately, definitely don’t trust the media, it’s a distraction and misdirection, at least somewhat
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post 1659214133 04-06-2022, 11:59 AM
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Originally Posted By rectifryer⏩
but its the individuals themselves driving the prices up

I've not seen any evidence to suggest large firms are buying more RE than normal. I keep asking for data and it never manifests.



two factors count against that perspective:

1) they still borrow and if bonds yield similar than RE they'll take the bonds as they're lower volatility. Bonds are raising rates with fed.

2) I'm not sure they're that much of the market.
https://www.washingtonpost.com/busin...rce=reddit.com
https://www.redfin.com/news/investor...hases-q3-2021/
post 1659214243 04-06-2022, 12:01 PM
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No chit real estate “experts” will say that, their profession depends on fear mongering the population to get them to buy now

It would be like going to a barbershop and asking if you need a haircut
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post 1659214333 04-06-2022, 12:02 PM
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Originally Posted By OffwhiteBrah⏩
https://www.washingtonpost.com/busin...rce=reddit.com
https://www.redfin.com/news/investor...hases-q3-2021/
That redfin article has good info.

The Wapo article just isolates black zip codes so they can write another article about racism.
post 1659214683 04-06-2022, 12:07 PM
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Regardless, there are going to be many more poorcels thus many more home invasions in the future. If you own a home but not a gun, you're literally a retard SRS
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post 1659214953 04-06-2022, 12:11 PM
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Originally Posted By OffwhiteBrah⏩
Endgoal here is to make everyone born after 1990 renters
this, keeps people poor
Cobra Kai Crew

srs
post 1659215023 04-06-2022, 12:12 PM
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Originally Posted By OffwhiteBrah⏩
https://www.washingtonpost.com/busin...rce=reddit.com
https://www.redfin.com/news/investor...hases-q3-2021/
Up 16% of sales just from 18% doesn't seem like that big of a deal especially considering they halved their spending in 2020. Overall, 18% is still crazy, no doubt but I don't think its the largest component of demand. I think they will stop buying homes as it becomes less attractive to do so compared with bond yields.
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post 1659215123 04-06-2022, 12:14 PM
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Originally Posted By rectifryer⏩
Up 16% of sales just from 18% doesn't seem like that big of a deal especially considering they halved their spending in 2020. Overall, 18% is still crazy, no doubt but I don't think its the largest component of demand. I think they will stop buying homes as it becomes less attractive to do so compared with bond yields.
16 to 18 was just in a quarter. Looks like its basically doubled in a couple years tho.
post 1659215803 04-06-2022, 12:26 PM
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I imagine that areas where prices have skyrocketed are at risk, this stuff can be highly localized. Real estate in my home base has declined in price since 2014 and is just now starting to pick up again.
post 1659217063 04-06-2022, 12:47 PM
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Normal fed interest rate increases won’t impact the market significantly. What could impact it is:
-significant unemployment
-large and rapid interest rate increases independent of the fed (ala the GFC)

However even these will be offset by investors getting back into the market and the overall economic recovery
post 1659217263 04-06-2022, 12:51 PM
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Let's see: we have skyrocketing inflation that is outpacing wage growth for most, houses on the market that are ridiculously overvalued, and rising interest rates making these overvalued houses even more unattractive. Plus I have been reading that construction on new properties is outpacing projected demand, so yeah, all signs point to a correction coming in the housing market.
post 1659218093 04-06-2022, 01:03 PM
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Originally Posted By semenreleaser⏩
Let's see: we have skyrocketing inflation that is outpacing wage growth for most, houses on the market that are ridiculously overvalued, and rising interest rates making these overvalued houses even more unattractive. Plus I have been reading that construction on new properties is outpacing projected demand, so yeah, all signs point to a correction coming in the housing market.
It should have corrected long ago but the ****git fed printing more money than ever before, and buying MBS really fuked it

GreatReset.mov
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post 1659218433 04-06-2022, 01:07 PM
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I think it will as people wil need larger down-payments to buy
post 1659219493 04-06-2022, 01:25 PM
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Originally Posted By semenreleaser⏩
Let's see: we have skyrocketing inflation that is outpacing wage growth for most, houses on the market that are ridiculously overvalued, and rising interest rates making these overvalued houses even more unattractive. Plus I have been reading that construction on new properties is outpacing projected demand, so yeah, all signs point to a correction coming in the housing market.
this is how i feel

there is no way this market remains the way it is

people are not making more money than 2 years ago
Future P.A in progress
We're all gonna make it

sleep tight pupper
post 1659219523 04-06-2022, 01:25 PM
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Originally Posted By ThatGuy950⏩
It should have corrected long ago but the ****git fed printing more money than ever before, and buying MBS really fuked it

GreatReset.mov
thats over now

even blackrock was like, hey wait a cottdamn second

the fed would have straight up kept printing till the gov't dissolved. They only stopped at the request of a single wall street firm.
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post 1659233713 04-06-2022, 06:54 PM
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There isn't going to be a crash, but houses are going to get pretty cheap compared to how things have been the last couple years. Anybody who needs to sell will end up taking a haircut beginning in a few months.
post 1659234513 04-06-2022, 07:13 PM
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I started looking a year ago but I’m not gonna buy any time soon. Prices don’t make sense. Can’t afford it either.
post 1659234673 04-06-2022, 07:15 PM
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At this point I think the only way it really crashes is if we have a real pandemic that kills off all the boomers
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post 1659234913 04-06-2022, 07:19 PM
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60% is that magic number, boyos....
Everything I post is satire.
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post 1659235053 04-06-2022, 07:22 PM
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I think it's perfectly reasonable for people to upgrade to a bigger house once every two years. Lol if you aren't flipping your gainz to a 10k sq ft house for a family of four.
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