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Matt J

SWGB
May 9, 2007
22,717
2,852
Low interest rates are the primary driver, and we likely won’t see a large change in those for a while. As long as money is cheap to borrow, consumers are going to buy property. Couple that with the pandemic coming to an end, you’ll see more inventory and more buyers enter the market. (It’s a good time to be a real-estate agent!)

I’d say the current boom will continue for a while. For rates to increase, you need strong economic growth and as a side effect inflation. If we see things start to heat up the FED will start to raise rates, and that in turn will cool the housing market. Those increases take years to play out, so we have a long way to go on rates before they become prohibitive to home purchasing.

Also I would ignore current chatter about inflation rising right now, that’s largely a result of lack of production caused by a workforce that’s still sitting at home waiting on the end of the pandemic. I’d bet we’ll hear about rising wages too, as producers get more aggressive in trying to find workers. Overall though this should mellow out over the next year or so as people continue to get vaccinated and Covid fades away.

It’s a good time to buy, build, and especially refinancing an existing loan. If you buy now you may be purchasing at a higher price point, but waiting on a major downturn could take years, and lower rates mean you’ll end up spending less anyway compared to what you might spend when rates are higher.

That's just a drawn out way of saying, "now's the time to buy".
 

redfisher

Beach Fanatic
Sep 11, 2005
430
27
Where is Shelly?
Wow, I haven't heard that name in a long time. Where is Shelly?

We are definitely in a bubble. It was June '05 when the last one started to burst and its just a question of timing. Maybe a year or two. I don't think it matters, cash buyers or not, because its never the last catalyst that causes it. There will be something new and unforeseen and it will burst.

Anybody who can look at the ECAR numbers and think its sustainable wasn't around in '05
 

Matt J

SWGB
May 9, 2007
22,717
2,852
Apparently someone dropped the California model here. Just heard of a listing this weekend for a decent neighborhood with no real amenities other than limited bay access for a million bucks. I think it's going to get more insane before long.
 

Poppaj

SoWal Insider
Oct 9, 2015
8,683
3,970
Apparently someone dropped the California model here. Just heard of a listing this weekend for a decent neighborhood with no real amenities other than limited bay access for a million bucks. I think it's going to get more insane before long.
Read or saw a story recently where a family in a hot market sold their home and were now looking for another. They are now finding it difficult to stay in their city with their budget. The wife said they took the first offer for their home which was eight percent above list.
Here’s the good part. She was prepared for her home to sell above asking, but not prepared to do the same when buying another. Why do people not realize they are selling and buying in the same market?
They now had to travel forty minutes away from their city before they found what they could afford.
At the end they were still renting a place and searching while prices continue to rise. I believe it was Austin, TX.
 

Lake View Too

SoWal Insider
Nov 16, 2008
7,181
3,725
Eastern Lake
Read or saw a story recently where a family in a hot market sold their home and were now looking for another. They are now finding it difficult to stay in their city with their budget. The wife said they took the first offer for their home which was eight percent above list.
Here’s the good part. She was prepared for her home to sell above asking, but not prepared to do the same when buying another. Why do people not realize they are selling and buying in the same market?
They now had to travel forty minutes away from their city before they found what they could afford.
At the end they were still renting a place and searching while prices continue to rise. I believe it was Austin, TX.
So, in effect, this is just general inflation but at an accelerated speed. Same thing with lumber prices and cars. Everything just going up, but faster.
 

Poppaj

SoWal Insider
Oct 9, 2015
8,683
3,970
So, in effect, this is just general inflation but at an accelerated speed. Same thing with lumber prices and cars. Everything just going up, but faster.
There will be a point where it will be best to just have patience and let the bubble burst. For me it was luck not any special insight on my part.
Back in the mid 2000’s my neighborhood was all new construction when the home next door sold pre-construction for $215 sf. Eighteen months later the builder sold to me for $118 sf with closing costs paid.
 

James Bentwood

Beach Fanatic
Feb 24, 2005
1,332
449
I'm thinking we'll have a soft pop once pent up demand is met and builders frantically ramping up inventory end up overbuilding a bit. Inflation and rising rates will help cool things and the frenzy that leads to overpaying will end.

I also think some people are going to come out of this better than ever and some will have made bad moves and end up house poor. The good news is that lenders are careful from2008 and the pandemic and are vetting borrowers so long term trouble in the mortgage market should be avoided.

Having said all that, SoWal has passed the point of no return with a high growth rate that will continue for decades. Freeport to I-10 is set to boom, as well as Panama City Beach north along 79 to I-10.
 

blindrid

Beach Comber
Aug 17, 2018
37
11
64
Santa Rosa Beach
Markets will slow, maybe not crash. I believe RE market is a bit of a fairy tale as I’ve seen houses sell over value and that has to catch up as well as the current admin driving us further in debt. I personally have put two cash offers with no contingencies in the past few weeks getting beat by way over market bids being financed. It has to end.
 

Poppaj

SoWal Insider
Oct 9, 2015
8,683
3,970
Markets will slow, maybe not crash. I believe RE market is a bit of a fairy tale as I’ve seen houses sell over value and that has to catch up as well as the current admin driving us further in debt. I personally have put two cash offers with no contingencies in the past few weeks getting beat by way over market bids being financed. It has to end.
Since you opened this door how much whining did you do when the previous admin raised the debt from 19+ trillion to 28 trillion?
 
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