Wednesday, May 05, 2021

I sure hope everyone doesn't decide to sell at once.

Janet Yellen's Flip-Flop And What She's Really Telling Us. 

"The Fed is boxed into a corner. Powell knows it. Yellen knows it..."

I'm hoping that Trumps' plan was to spend all the money he could, so the other side couldn't. Having said that - I am none too happy with the demand he has pulled forward. The government is always juicing shit, and Trump juiced what he knew. Real Estate.

I rather love articles right now saying how this time is different. We've been underbuilding since the housing crisis, so there is no way housing prices can fall. We aren't in a bubble they write confidently. Prices are just going to keep accelerating.

I am the queen of "population increases will eat this supply up"! All through the housing recession I wrote article after article about this. Having said that - don't listen to journalists. They can't do math. Which is also why they can't learn to code BTW. 

Source.  Hit the max button as the link back doesn't.

This is the historical chart for house price appreciation. You don't want to be those people who bought where that pink arrow is. Unless you are fond of buying high and selling low.

Housing basically hit a peak in Spring of 2019 and was somewhat languishing. It picked up a bit in the winter of 2019, but it wasn't until March of 2020 that things became super accelerated. And it has been absolutely gob stopping. Housing prices up almost 18% in Nevada despite almost no one working.

And if you didn't believe housing prices hadn't fully recovered before 2020 - you should read this article I ran across a couple of days ago.

‘Zombie’ Mortgages Come Back to Haunt Property Owners after Great Recession.

As I understand it - people who defaulted on their second mortgages in the housing crisis are now back on the hook. In all the previous years, it was unprofitable to go after them. Buuuuuuut! Since we are now in a housing boom (said in the most sarcastic way) they are. I don't know how many people this affects, but wow.

Now, I have been lucky in the pandemic. I already had a long time renter. But the stories I'm starting to read about other people send shivers down my spine. For small landlords, sure the bank isn't foreclosing on them - but those people count on rent money to survive!

Last week my property manager sent out an email saying "We have also seen a change in resident mentality. With the eviction moratorium and other COVID-19 related tenant protections in place, some residents feel that paying rent is more like a favor and less like an obligation."

I have already started to see an increase in multifamily properties. Which is unusual. But these landlords have to be just wrecked. Dealing with the bank and tenants. And the government trying to make it so you are bankrupted. I know they just overturned the eviction moratorium, so maybe now we get to see what reality looks like. Those people who bought at the pink arrow above are probably going to be shocked at just the return to the mean prices. 

I should go back through my posts because if I recall correctly things were sitting on market for about 3-4 months before the pandemic hit, with price REDUCTIONS. Then all of a sudden they were going 300k over asking. Cause everyone thinks that's normal.

Finally, the reason I titled the article this way is because - housing prices are very good. If I haven't been working I can still sell my place and find relief. I'm sure this is on a lot of people's mind. And already I'm noticing a lot of inventory coming on. 

My bet is that when all that money printing fades we are going to be back in a much worse situation. Today they starting talking about the debt ceiling and I was like - THERE IS A CEILING?!? Cha.

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