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It's pretty obvious we are headed for a massive housing and RE bust that will make 2007/2008 look easy.
7% rates are way too high on the average $350K home. Housing prices are coming down in some areas. In other desirable areas with low inventory it's not as relevant and many are paying cash. But I foresee prices dropping severely and trillions of dollars in value evaporating leaving owners and banks upside down in a way we've never seen before.
Location: East of Seattle since 1992, 615' Elevation, Zone 8b - originally from SF Bay Area
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Here where the median home price is already down 22.5% from last year, but that's still at $1.5 million. There have been very few homes on the market in the last few months but they have still sold within 2-3 weeks. There is a new development of 35 homes starting at $2 million, all but 10 are sold. I think the big difference now is that most people can hold off selling until interest rates go down, but if they do sell there are still people that can pay cash or afford the payment at 7%.
It's pretty obvious we are headed for a massive housing and RE bust that will make 2007/2008 look easy.
No, it is not obvious at all.
Quote:
Originally Posted by rkcarguy
But I foresee prices dropping severely and trillions of dollars in value evaporating leaving owners and banks upside down in a way we've never seen before.
It's pretty obvious we are headed for a massive housing and RE bust that will make 2007/2008 look easy.
7% rates are way too high on the average $350K home.
How many of the 160,000+ housing markets in the US have an average price of $350,000?
It's pretty obvious we are headed for a massive housing and RE bust that will make 2007/2008 look easy.
7% rates are way too high on the average $350K home. Housing prices are coming down in some areas. In other desirable areas with low inventory it's not as relevant and many are paying cash. But I foresee prices dropping severely and trillions of dollars in value evaporating leaving owners and banks upside down in a way we've never seen before.
Prices will go down....bust?...worse than 2007/08?
No, IMO.
There is a dearth of inventory.
IMO, prices are too high anyway in general....and yes, I do own.
Anecdotally, I live in a very hot market where prices have risen around 60% since 2019. Prices are starting to come down, with several nearby houses recently reduced by $5-$10k. The house down the street went to sale pending after only a couple weeks on the market but then that sign came down. A friend who used to be a realtor and still has access to the MLS said the buyer's financing had fallen through.
I personally can't imagine buying my house today for 60% more money at nearly double the interest rate.
Anecdotally, I live in a very hot market where prices have risen around 60% since 2019. Prices are starting to come down, with several nearby houses recently reduced by $5-$10k. The house down the street went to sale pending after only a couple weeks on the market but then that sign came down. A friend who used to be a realtor and still has access to the MLS said the buyer's financing had fallen through.
I personally can't imagine buying my house today for 60% more money at nearly double the interest rate.
Thank you. In 2008 we saw this, people hugely upside down walked away from their homes. And, rates and prices were not as high as they are now. Financing falls through on sale after sale...the bank losses coupled with far fewer mortgages being inked is going to add up. I'm not saying the market isn't silly, normalization of prices is needed, but 7% is just too high, gonna kill the housing market and the banks.
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