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Joined: Sep 2021
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Campfire Tracker
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Campfire Tracker
Joined: Sep 2021
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Like everything else, it is market driven. The North and West Coast are seeing stagnation, many areas of the South continue to see huge demand and bidding wars on home sales.
If you live in a Blue State, the market is soft. If you live in a Red State, then strong demand continues.
Si Vis Pacem, Para Bellum
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Joined: Feb 2016
Posts: 17,841
Campfire Ranger
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Campfire Ranger
Joined: Feb 2016
Posts: 17,841 |
My house is a dump LOL, worth more than I paod but not a whole lot.
New neighbors suck so Id like to move.
Aint paying what others asking, still too high.
Wait and pick up a place out of town
When it crashes.
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Joined: Dec 2013
Posts: 44,875 Likes: 38
Campfire 'Bwana
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Campfire 'Bwana
Joined: Dec 2013
Posts: 44,875 Likes: 38 |
Jeff, zillow's buy model was terrible. That's why they're in the crunch they are. They were trying to use CA style algorithms to make buy decisions from the Ivory Tower. That doesn't work everywhere, IMHO.
Yes, that's what they are saying, good story, probably true. But I think they'd have their finger on the pulse of the market better than any of us and they are dumping 7,000 houses, so there is that. You gotta figure they are looking out for themselves. The money invested in those homes isn't theirs, it's investor money, it's hedgefund money. If the market takes a big downward swing in the next 6 to 8 months they'll come out looking like heros for dumping the inventory now. It'll be as if they predicted the fall and saved their investors a ton of cash. Time will tell.. I think they were also trying to run rehabs from the Ivory Tower, which you and I both know is fool's ploy.
Slaves get what they need. Free men get what they want. Rehabilitation is way overrated. Orwell wasn't wrong. GOA member disappointed NRA member 24HCF SEARCH
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Joined: May 2006
Posts: 808
Campfire Regular
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Campfire Regular
Joined: May 2006
Posts: 808 |
Guys, no one will have much buying power soon. These shutdowns , stimulus packs and incentives need to be paid for and the only way that is done by taxation and inflation. Coupled with what appears to be open slather by business leaders across the 1st world to allow all sorts of market manipulation without limit( price gouging, monopolisation, artificial shortages) the average person is going to want to have as much of his life consolidated, simplified and debt free as possible.
In my industry, international logistics the big players now completely control the market and shipping costs between two continents for a 40ft sea container have jumped from $800 to $10,000. over 1000% inflation...
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Joined: Dec 2013
Posts: 44,875 Likes: 38
Campfire 'Bwana
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Campfire 'Bwana
Joined: Dec 2013
Posts: 44,875 Likes: 38 |
Jeff, zillow's buy model was terrible. That's why they're in the crunch they are. They were trying to use CA style algorithms to make buy decisions from the Ivory Tower. That doesn't work everywhere, IMHO.
Yes, that's what they are saying, good story, probably true. But I think they'd have their finger on the pulse of the market better than any of us and they are dumping 7,000 houses, so there is that. You gotta figure they are looking out for themselves. The money invested in those homes isn't theirs, it's investor money, it's hedgefund money. If the market takes a big downward swing in the next 6 to 8 months they'll come out looking like heros for dumping the inventory now. It'll be as if they predicted the fall and saved their investors a ton of cash. Time will tell.. I think they were also trying to run rehabs from the Ivory Tower, which you and I both know is fool's ploy. Just got this email from the Dade Real Estate Investor's Association. This guy is a well known investor and real estate mentor in the area. He has a closer finger on the pulse and supports what I was saying above. ========== Zillow®, I Hate to Say I Told You so, But I Did… I have been receiving emails and phone calls about the recent financial disclosures that Zillow® has made public. These investors are thinking that the market is suddenly dying and Zillow’s® financial problems are indicative of the beginning of a market collapse. I think it was late 2018 or 2019 when investors started contacting me about the next great obstacle to doing wholesale deals. It went like this, “Now Zillow® is buying homes and there will be no deals left!” I mostly brushed it off as an excuse to not be making offers and I still know I was right. Blackstone had been buying properties for years and had been successful so why not Zillow®? But the whole encounter did peak my interest and since Zillow® is a public company it was easy to deep dive into what they were doing and how it was working. At that time, they had a very successful business model of supplying data to the public and charging for advertising. When I did my monthly presentations at DREIA I started to mention how this Mega Giant had diversified into mortgages, rentals and all sorts of additional income sources to offer to people who bought their acquisitions. As I understood their new business model, they would buy properties either listed or from investors, rehab them and rent or resell them. This model wasn’t new, I first saw it in 2008 – 2009 when national lenders were foreclosing on so many SFH’s that they decided to start rehabbing them and retailing these properties. If you are curious why the lenders’ business model changed, it was probably because they saw the national statistic that the Fed publishes saying that investors buy homes and resell at an average profit of $49,000+ (in 2008 - 2009). Of course, these resale figures don’t include the costs to carry the properties, do the rehabs and resell them! The result was the national banks were in and out of the rehab game in about one year and licking their wounds from countless losses on most of the properties. The banks learned their lesson and very, very rarely get involved these days in fixing any of their foreclosures. Every Quarter when Zillow® reported their earnings, I would deep dive into their SEC Disclosure to see where they were making or losing money. The first thing I noticed was while other iBuyers raised private capital to fund their purchases, Zillow® borrowed their funding. At the year-end, I believe it was 2019, I showed that each property (SFH) that they rehabbed and sold amounted to a LOSS of $56,000 – that’s for EACH property! The combination of over-paying for properties, poor and expensive rehabs, and the cost to carry the properties is what killed their profit margin. I just heard that they took a $302 million write-off which may have included other issues. In summary, forget about iBuyers and hedge funds being your competition. I blame the management for getting into the investor mindset and being guided by someone who didn’t understand the investor-rehabber-sales cycle. They were constant buyers but of full value properties that can be listed, relisted quickly or held as long-term rentals. PS – they have been paying full market value and have been the driving force in the rapid rise in SFH prices. Gee, I wonder what will happen when interest rates rise and their buying slows or stops? I guess that in the coming months I may be publishing another article entitled, “I told you so” once again. Frankly, your only competition resides between your ears and saying that the institutional buyers are killing the market is an excuse. If you aren’t making offers daily, you are destined to out-think yourself and the market. DISCLOSURE and DISCLAIMER – this article represents only my opinion and doesn’t reflect anyone else’s whatsoever and it is possible that I could be totally wrong in my assessment of their financial predicaments. I suggest you “fact check” anything in this article by reading the SEC Disclosures available online for Zillow®. I wish you limitless success in all you do, Dave Dinkel
Slaves get what they need. Free men get what they want. Rehabilitation is way overrated. Orwell wasn't wrong. GOA member disappointed NRA member 24HCF SEARCH
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Joined: Jan 2010
Posts: 23,590 Likes: 3
Campfire Ranger
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Campfire Ranger
Joined: Jan 2010
Posts: 23,590 Likes: 3 |
I get itchy feet to move but the uncertainty and overall pain of packing up 20 years of schit demotivates me pretty quickly. I'll do something in the next few years. I just don't know what yet, wife and I both agree it won't be here.
have you paid your dues, can you moan the blues, can you bend them guitar strings
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Joined: Feb 2003
Posts: 10,434 Likes: 7
Campfire Outfitter
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Campfire Outfitter
Joined: Feb 2003
Posts: 10,434 Likes: 7 |
There is nothing noble in being superior to your fellow man; true nobility is being superior to your former self. -Ernest Hemingway The man who makes no mistakes does not usually make anything.-- Edward John Phelps
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Joined: Jan 2012
Posts: 26,719 Likes: 13
Campfire Ranger
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Campfire Ranger
Joined: Jan 2012
Posts: 26,719 Likes: 13 |
3rd and especially 4th qtr earnings may be very disappointing in many sectors[not just RE].
FJB & FJT
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Joined: Dec 2008
Posts: 8,347 Likes: 3
Campfire Outfitter
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Campfire Outfitter
Joined: Dec 2008
Posts: 8,347 Likes: 3 |
Things will correct at some point, but with the fed's foot on the accelerator it's not going to happen anytime soon. Interest rates drive real estate prices.
"Life is tough, even tougher if your stupid" John Wayne
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Joined: May 2014
Posts: 5,881 Likes: 3
Campfire Tracker
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Campfire Tracker
Joined: May 2014
Posts: 5,881 Likes: 3 |
My house is a dump LOL, worth more than I paod but not a whole lot.
New neighbors suck so Id like to move.
Aint paying what others asking, still too high.
Wait and pick up a place out of town
When it crashes. Might be hard to sell a dump in a crash.
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Joined: Nov 2002
Posts: 18,485 Likes: 2
Campfire Ranger
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Campfire Ranger
Joined: Nov 2002
Posts: 18,485 Likes: 2 |
Still nuts around here. When we moved in 2018 the house sold for $430k (purchased in 2013 for $260k). Just saw it sold again last month for $710k, which was $15k more than the asking price.
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Joined: Nov 2015
Posts: 5,771 Likes: 5
Campfire Tracker
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Campfire Tracker
Joined: Nov 2015
Posts: 5,771 Likes: 5 |
Zillow had our house listed, and we never knew it until a neighbor ask about it, and why we were selling. Had to call Zillow and raise he'll to get it off their site! Bunch of fuggn crooks.
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Joined: Jan 2010
Posts: 23,590 Likes: 3
Campfire Ranger
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Campfire Ranger
Joined: Jan 2010
Posts: 23,590 Likes: 3 |
Wasn't Zillow buying homes from people and storing them in inventory to sell later? I think they about went belly up doing that.
have you paid your dues, can you moan the blues, can you bend them guitar strings
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Joined: Sep 2016
Posts: 1,313
Campfire Regular
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Campfire Regular
Joined: Sep 2016
Posts: 1,313 |
I think it's unreasonable here. Taking the 50% income for the county, assuming a 20% down payment and 3% interest rate, a buyer could afford $450K or so of house. Basically all you can get for that is something in a gang infested area, or a trailer.
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Joined: Feb 2003
Posts: 10,434 Likes: 7
Campfire Outfitter
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Campfire Outfitter
Joined: Feb 2003
Posts: 10,434 Likes: 7 |
How many homes did BlackRock buy? At most, investors purchased another 39,000 single homes in the back half of 2020
My neighbor works for a hedge fund. They pride themselves in how many billionaires they create. He said Blackrock is buying more homes than his firm.
There is nothing noble in being superior to your fellow man; true nobility is being superior to your former self. -Ernest Hemingway The man who makes no mistakes does not usually make anything.-- Edward John Phelps
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Joined: Jun 2020
Posts: 10,266 Likes: 13
Campfire Outfitter
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Campfire Outfitter
Joined: Jun 2020
Posts: 10,266 Likes: 13 |
I think it's unreasonable here. Taking the 50% income for the county, assuming a 20% down payment and 3% interest rate, a buyer could afford $450K or so of house. Basically all you can get for that is something in a gang infested area, or a trailer. I’d wager that most aren’t putting 20% down but as long as the government keeps pumping money into the system while keeping interest rates dirt cheap I’d expect the housing market to stay on fire. The governments between a rock and a hard spot but doesn’t seem to care. It’s going to be interesting to see what happens and when.
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Joined: Nov 2008
Posts: 16,610
Campfire Ranger
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Campfire Ranger
Joined: Nov 2008
Posts: 16,610 |
Things will correct at some point, but with the fed's foot on the accelerator it's not going to happen anytime soon. Interest rates drive real estate prices. Interest rates are adjusted with inflation. The FED won't ignore that much longer.
"Hey jackass, get your government off my freedom." MOLON LABE
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Joined: Dec 2013
Posts: 44,875 Likes: 38
Campfire 'Bwana
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Campfire 'Bwana
Joined: Dec 2013
Posts: 44,875 Likes: 38 |
There are some signs that could be viewed as a early warning. Zillow is dumping their inventory, Bloomberg reported Monday that Zillow is looking to sell about 7,000 homes, and is seeking roughly $2.8 billion for the houses.This is the homes they have purchased to re-hab and re-sell. They are also laying off 2000 employees. Some articles claim they are wholesaling them off in bulk lots. Zillows saying they just couldn't turn a profit with their house flipping business so they are stepping down. The way I see it with over 5,000 employees they should have a damn good idea of how things are going. They also should have been able to stay in the green flippin houses if the rest of us could. It's just not what they are saying, I wouldn't be saying the sky is about to fall either if I had 7,000 houses to unload. Regardless of what is said or being speculated, they are dumping their entire inventory no matter how you slice it. Time will tell. I started unloading every thing I acquired after the 2007 crash 18 months ago. Maybe a little premature but I did fine and I'm beyond it. Zillow to shutter home buying busin...oyees as its big real estate bet faltersRed-hot US housing market begins to coolJeff, did you read my responses to you about zillow in the other thread? They (zillow) screwed up.
Slaves get what they need. Free men get what they want. Rehabilitation is way overrated. Orwell wasn't wrong. GOA member disappointed NRA member 24HCF SEARCH
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Joined: Dec 2008
Posts: 8,347 Likes: 3
Campfire Outfitter
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Campfire Outfitter
Joined: Dec 2008
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Things will correct at some point, but with the fed's foot on the accelerator it's not going to happen anytime soon. Interest rates drive real estate prices. Interest rates are adjusted with inflation. The FED won't ignore that much longer. Inflation screws the people but fixes a lot the feds problems . I think they let it rip.
"Life is tough, even tougher if your stupid" John Wayne
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Joined: Feb 2003
Posts: 10,434 Likes: 7
Campfire Outfitter
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Campfire Outfitter
Joined: Feb 2003
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Inflation screws the people but fixes a lot the feds problems . I think they let it rip.
Ancient Romans struggled with inflation
There is nothing noble in being superior to your fellow man; true nobility is being superior to your former self. -Ernest Hemingway The man who makes no mistakes does not usually make anything.-- Edward John Phelps
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