Friday, September 20, 2019

Oh - things are getting serious now.

The consumer is going to roll over imminently.

You guys know I've been tapping the housing market a lot lately in regards to the price reductions. But it wasn't until last night when I was watching the old people news that I fully realised how bad things had gotten. I've been going through price history and seeing this house was marked down by 100 grand this house X amount. But I haven't been keeping track of percentage drops. Now this news is hitting the main stream media and it's kinda ugly. NO matter what you feel about prices, this will feed through to the consumer.

A town four cities over has seen prices drop by 14%. This is a very affluent town.

San Jose down by 9%.

The town next to me down by 9%.

Oakland down 9%.

And buyers have not rushed in to take advantage. Inventories are still rising. Now I don't expect a repeat of the Great Recession, as those circumstances were very unique and recessions never happen the same way twice. But price drops like this start affecting consumer behavior.

4 comments:

  1. "Now I don't expect a repeat of the Great Recession ..."

    Don't be so hasty with that, it's possible.

    Real estate would definitely be one of the first places where you'd expect a valuation slump to proceed, and this could happen without directly affecting spending habits for a large hunk of the economy.

    But I'd already warned you to panic now and avoid the rush: what you are also seeing involves a large number of Boomers wanting to cash out of their homes by selling them at greatly inflated values to the Millennials.

    Apparently the Millennials were raised as ready-made suckers for the predatory Boomers, which is probably why Gen X and Gen Z really, really hate them both.

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  2. "Apparently the Millennials were raised as ready-made suckers for the predatory Boomers, which is probably why Gen X and Gen Z really, really hate them both."

    I think we hate them both because Gen X is the only one working. We get stuck with the consequences of all their stupid ideas.

    " what you are also seeing involves a large number of Boomers wanting to cash out of their homes by selling them at greatly inflated values to the Millennials."

    That is not going to happen. I know you probably think that is wishful thinking on my part and that's okay. It's not for some desire to have them prop up the real estate market. There has just been a change in behavior when it comes to boomers. None of them want to go to old people homes. So they all have old people nannies now. They are all aging in place.

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  3. https://www.youtube.com/watch?v=ZthGh758pYY

    ReplyDelete
  4. she said,

    Millenials, The 'living in the basement' generation.

    “A Millenial is someone who looks like WTF, walks like Jane and smells like Cheetah.”

    ReplyDelete