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Gravy Train

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Everything posted by Gravy Train

  1. Agreed and rates falling back into the 5s or upper 4s kinda cements this new standard of pricing. Not a hot take. I considered what mechanics are needed to drive a more significant price correction across the country and it would take someone like a Blackstone or Invitation Homes to falter and turn over nearly all their inventory at once... or, another 2008-like financial crisis with a significant uptick in foreclosures, and that's not good for anyone, especially those who realize it just offers a better buying opportunity for other investors who had liquidity parked in places with less exposure. But high property values fucks over everyone paying property tax and insurance, even those who don't need to sell, as the things that go into Escrow must be supplanted with additional income, and that's clearly not happening. @gmr548: inflated price and/or mortgage terms keeps people from doing fun things with their homes, while others defer maintenance because so much of their income is locked into a monthly payment. Have a look at some listings now, realizing what that kind of money could have purchased just two years ago.
  2. No, I completely get that, which is why in my very first post, I mentioned "I'm sidelined like the rest," either unwilling or not budgeted for the $200K premium in price escalation over just two years' time. Nothing about these properties justifies their price, but there's usually another buyer who needs that home more than you do. That's not a justification of value to me, it's just a bubble that hasn't deflated yet. Really, very few people are eager to jump into this historic affordability crunch, which is why this market is wiped out and we're in stalemate. Wages will never come close to match, so "wanting this house more than the next guy" comes down to sometimes really unsound financial decisions or more creative ways to improve income. With Texas' property tax structure, we're lucky this is a nondisclosure state. But really, a $40K decrease in price is far more valuable to the buyer than $50K in concessions at closing.
  3. Realtor: We have three offers already at $550, $589, $590, would you like to entertain any of them? Client: I'm just going to hold out for an offer near $700. But our listing is already 68 days old, I'm concerned nobody is taking this seriously anymore Realtor: Should I share feedback from the last showings? The first couple noted your HVAC system is 14 years old, the second couple shared concern of the rotting fence, the third stated they'd like to finance some home improvement funds to redo the kitchen. None are able to qualify for loan amounts that exceed $630, as we're unsure your home will appraise for anything more than $550. Client: Well isn't that convenient? It's not like their appraisals from 2006 protected lenders from 2012 valuations, did they?!
  4. Yes, where mortgage origination activity has been reduced by over 75% and the cost to purchase dramatically outpaces current rents, it's logical to expect greater price volatility. Should the cost to rent remain competitive (or become more aggressive as more units come online), this will pressure those investors who bought at the peak of the market. Time to close often dictates listing price where an experienced agent should offer guidance to achieve the best outcome of both variables.
  5. The concept makes plenty of sense to me when price appreciation unhinges from local economic fundamentals of wage growth and current construction costs. Moody's finds that current pricing among nearly all markets in the U.S. is overvalued. If "the price is the price," realtors wouldn't be playing games like delisting, then relisting (with a marginal change in price) just to reset the DoM indicator. This has become more of a trend with flip inventory in attempt to secure a seller's desired margin.
  6. Agents suggest price based on local comps and how quickly the owner needs to close. Appraisers, well, who the fuck knows what they do, they're just telling buyers exactly how much they're overpaying for the address. This shouldn't be a "new norm" because only 4% of the U.S. SFH inventory turned in 2020 and 4.6% of the market transacted in 2021. It's as if the small portion of the market that needs a new car is getting caught at the dealer paying $15K, $20K on ADM (very much a Covid-era thing) and instead of telling the dealership to fuck off for MSRP, they just shrug their shoulders and assume a bigger loan because the 4-square box made their monthly payment palatable at a 72-month term.
  7. Some made a healthy windfall along the way and are now impacted by the market fallout. But you know what would fix that problem sooner? Deeper corrections on listing/contract pricing, and the power to do so is in their hands. We shouldn't be fighting listings priced like it's 2021 in an era of 6.xx% rates and further erosion of consumer confidence. These shanties don't justify the 40% premiums appended in just a 30-month dwell. I'd be writing offers like it's 2019.
  8. An abundance of cheap capital and [forecasted] better returns than other equities and REITs. It feels grimy to me, that wholsale investors shouldn't be able to leverage housing as an speculative asset, especially when their activity drives up standard living costs for all, playing tax haven shell games on inventory the next generation should be able to purchase to for their budding families and financial security.
  9. Agreed on the norm of the benchmark rate and perhaps that'll tamper further price escalation. Stating the instant affordability issue was due to supply is a lazy take, however.. It wasn't a supply issue when AirBnB inventory shot off like a rocket and institutional investors scooped up 40% of sold inventory between 2020-2022, repurposing them into perpetual rentals, completely locking out the starter home category, and iBuyers became a norm with "cash" to secure the offer. Price was fueled by Fed policy and the demand side, which is difficult to justify for those who actually homestead their property: https://www.bloomberg.com/news/articles/2022-07-07/new-fed-paper-finds-surging-home-prices-driven-by-demand-not-supply?srnd=premium#xj4y7vzkg&leadSource=reddit_wall https://www.federalreserve.gov/econres/feds/files/2022041pap.pdf
  10. How do property taxes work? Affordability is eroded not only by mortgage rates, but by all basis costs. "Cheap" mortgage is relative if we don't return to said benchmark rates and pre-Covid pricing. Few are covering that spread in income, so perhaps we should just wait a while longer. Eric Bramlett's Austin metro numbers:
  11. I'm sidelined like most of the market, either locked in by a sweet 2021-era mortgage or locked out of the price category that was budgeted in 2019, but escalated by some $200K in 2022, even in markets where the demand side shouldn't drive such appreciation, like that lake house in West Hillfuck, TX. That "buyer demand" wasn't borne of new buyers (e.g. the tail end of the Millennial generation suddenly able to afford their first home), it was due to Fed policy and a massive opportunity for the institutional and mom-and-pop investor to scoop up anything and everything on the market for leverage. With most buyers today constrained by 2019-era affordability measures, a price correction might fix that supply problem. Right now, it's seller-buyer-stalemate. I should study for those six weeks or whatever joke it takes to get with TREC just so I can write lowball offers all day every day.
  12. I knew I'd put my shit on blast with that reply last night but I'm sour grapes on the health of the current market and the sudden valuation hikes of $200K+ for the same SFH that should never have seen such price appreciation for nothing other than hotter buying demand fueled by too-cheap capital, landlording as a revenue stream, and an asset class to park liquidity. I want to upgrade my home and/or buy a lake house, but feel sidelined for years until the health of the market is restored and right now, price isn't moving down as fast as it should to reflect affordability with lost transactional volume. Like it's 2008 all over again, I can point to mortgage brokers for gaming the system and appraisers for sticking their thumb tacks on the new valuations, practically working for the realtor. Here we are in April where FHFA increased Fannie and Freddie SFH loan limits up to $1,089,300 in HCOL locations and $726,200 in the rest of the country. Fannie took it one step further in their decision to waive property appraisal for lending: https://selling-guide.fanniemae.com/Selling-Guide/Doing-Business-with-Fannie-Mae/Subpart-A2-Lender-Contract/Chapter-A2-2-Contractual-Representations-and-Warranties/1645976621/A2-2-06-Representations-and-Warranties-on-Property-Value-03-01-2023.htm Appraisers are a meaningless barrier of entry to home ownership and certainly haven't stopped buyers from making poor financial decisions, nor of their realtors from discouraging zesty offers, to the detriment of eating their own lunches. And being residents of Texas, we all pay significantly greater property tax on the purported valuations.
  13. We can fix that... with a very real (2018-2019-era) price correction, but sidelined inventory locked into too-sweet 3% rates, questionable appraisals, and the racket of the NAR driving price agenda for bigger commissions aren't helping. Let it burn.
  14. ...so like 22 routers and a couple Nexus switches? 😆 Good job, Russia, now you all get to deploy Huawei or some bootleg Sonicwall or whatever remains on the black market with unknown firmwares.
  15. Seems like the ideal warhead type to counter embedded trenches but that also implies a healthy air fleet to deliver such munitions.
  16. Apparently people hate their experiences at dealerships so much that they don't want to deal with the hassle of returning every 2-3 years for a lease schedule, which snarls the used car market. Since January 2020, around the time dealerships started playing shell games with dwindling inventory, lease originations have dropped 40% and aren't coming back. Of course, their buying power has dramatically decreased over that same short period, with rising vehicle prices and finance rates, which might never be reversed. https://jalopnik.com/people-aren-t-leasing-cars-and-it-s-killing-the-used-m-1850018655
  17. Harkening to the very title of this thread, we learn Russia's petty bitchassedness went so far as to torture Ukrainian PoWs captured from Snake Island, desperately searching for the warfighter who told the Moskva to go fuck themselves.
  18. There used to be an Austin area ticket broker who posted on TOS, don't know if he made it over here. Austin, Dallas, Houston, doesn't matter... If you know one or someone posts here, shoot me a PM, I'm looking into a couple events coming up.
  19. They're becoming too busy-looking for me. Mercedes are on a whole other level of busy gimmicky interiors but BMW is starting to throw more textures and random polyagonal shapes in than Lexus ever had.
  20. Passing by the shopping cart full of Russian Standard Vodka marked down for 50% within the entry of my local Spec's has been awkward. Shit's been there for months.
  21. Sounds like you also need an effective CTO or VP of Technology, if you wanna shoot me a PM
  22. I thought they're basic pre-programmed, GLONASS-guided drones that aren't very precise with course-correction or final approaches. Many of their cheaper cruise missiles work the same but add heat signature logic into guidance, which is why they've been so prolific with power infrastructure and civilian residences.
  23. Thanks, he's unsure how often he can get away but that most of his client-development opportunities are in Texas, and there's a chance he's visiting Austin over this current trip. Crowdsourcing scarce medical supplies or Starlink terminals seems high on the priority list still.
  24. I nearly forgot about an important impression Kostiantyn noted in our dialogue last night-- that most Ukrainians who fled Europe for safety at the start of the war share the desire to return, rebuild and settle as quickly as peace is restored. Many of his software engineers relocated to Romania temporarily, which seemed like an easier route to exit the country in the early days of conflict, but none have the desire to permanently settle there. We share confidence that the rebuilding effort will be epic and that this fight for their independence will permanently reduce the liklihood of corrpution returning to local offices, that they all realize how poorly prepared they were in 2014, and it's served as a lesson for their culture.
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