Housing crash deniers ???

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Housing crash deniers ???

Greg R.
Investor · Dallas, TX · Member since 2016 · 887 posts · 1k+ votes

Unfortunately I've been away for a few months while taking care of some personal matters, so I haven't been able to keep up on discussions. 

However, several months ago there were ample amount of folks here insisting that a market crash/ correction was impossible and that prices would only continue to increase.

Curious if there are still people out there who feel this way? If so, I'd love to see some data that supports your view that the market isn't going to crash/ correct. 

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Greg ScottPro Member
Rental Property Investor · SE Michigan · Member since 2014 · 4k+ posts · 6k+ votes
4y

The market may correct, but I firmly believe there won't be a crash.  The reason is simple, equity.

Before 2008 people with no income could get liars loans and buy much more real estate than they could afford.  We heard stories of cleaning ladies buying multiple million dollar homes.  When home prices starting falling, the whole thing collapses like a house of cards because nobody had any equity.  They couldn't sell and get out.  We had cascading foreclosures creating a downward spiral.

Recently, prices have been surging.  Given the laws passed after the Great Recession, appraisals and lending is highly restricted.  Appraisals have not been keeping up with prices and lenders won't lend above appraised value.  We sold a house in 2021 and in one day had 20 offers.  Several of them had acceleration clauses stating they would pay more than anyone else up to $X.  Both of them waived any financing contingency because they KNEW the house wouldn't appraise for what they were offering.  They had to make up the difference with cash.  Those people have a ton of equity in their homes.  If they had to sell, they might take a haircut, but they aren't going to get foreclosed. 

There is no  house of cards here to come tumbling down.

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  • Carlos Ptriawan
    Member since 2019 · 7k+ posts · 4k+ votes
    4y

     other than it appears history can repeat itself..  At least to a certain extent I highly doubt one year ago anyone could have imagine rates jumping up 4% in 4 months time. 


    The rate of Fed interest rate hike is the FASTEST in the history of the Fed :) 

    and that's where 100% of BP prediction is wrong, it's much worse. 

    But no point even looking back at 2006.   There's no such thing as  "interest rate of 6% is normal".  

    In 2006 cap rate in CA is still 7-9%, now it's 2-3%.
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  • Ben Einspahr
    House Hacking Specialist · Denver, CO · Member since 2016 · 411 posts · 396 votes
    4y
    Quote from @Greg R.:
    Quote from @Ben Einspahr:
    Quote from @Greg R.:
    Quote from @Ben Einspahr:

    @Greg R.

    My simple answer is economics 101. Supply vs demand. Recession, very possible. Crash, not likely.

    How does a shortage of new construction negate 7% rates, hyper inflation, and people not being able to afford what's out there? My point has been around interest rates and overall market conditions. If the economy was strong, not experiencing hyper inflation, and interest rates were in the 3s-4s we'd be having a different conversation. 

    @Greg R. 

    Well a couple things to note on your response. Looking at todays current market conditions on a 5 year time line, yes it does not look good. But if you look historically, 30+ years, its not as bad as you are saying it is. To back my point, here is some data.

    Housing affordability is at its average when looking at 30 year timeline 


    Interest rates are still below 40'ish year average. Slide is a little out dated as the are closer to 6.75 right now



    And if you think today is not good time to buy a house (rental property) because inflation rates are really high, historically speaking, that is not true. Real estate is one of the strongest hedge against inflation.

    We have just been spoiled with low inflation. If you would like the resources I am pulling this information, would be happy to send you. 

    Best of luck.

    Ben 

    Ben, have you considered nominal interest rates as opposed to real interest rates? How about the CPI? 
    A lot of people like to cite a time in the 80's when rates were were through the roof... but what was the circumstance around those rates? At one point in 1980 interest rates reached 13%, way higher than today. However, inflation was raging at 15%, making the nominal rate -2%. Take today's rates, let's just call it 6.75%. Inflation is currently at 8.25, making the nominal rate -1.5. When looking at the nominal rate, rates are higher right now than what they were in the 80's when the real rate was at 13%. 

    When looking at housing affordability, we need to look at the CPI. Homes were much more affordable in the past compared to what they are now.




     What are your real estate goals?

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  • Greg R.
    OP
    Investor · Dallas, TX · Member since 2016 · 887 posts · 1k+ votes
    4y
    Quote from @James Hamling:

     The point, and why the CORRECT and ACCURATE statements that mortgage rates today are closer to normal then what they were, is because all the years rates were in this area, did everything collapse? No, that's the point. 

    @James Hamling what is your definition of "normal" rates?

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  • Michael Wooldridge
    Member since 2022 · 485 posts · 216 votes
    4y

    I don't know. I can't understand why we would try and argue interest rates like this is normal. It's not, not with median housing values compared against median income. Which for anybody comparing to 1980 have you looked at median income vs median house cost?.

    So I do think thats a pretty poor argument for James to make.

    That said with wages up (people should look at wage growth last 3 years) , compounded with inflation,  and a drop back down to 5% - 5.5%, even 6%,   rates I do think it's sustainable to keep values up. But it's one of those things you mix all the items in and see how it balances out - none of us know. Much of it depends on the global and fed, how bad the recession is etc... 

    For now with rates vs housing cost, It's still going to be an East vs West thing. Also with so many people moving to remote work I do wonder about housing values long term in California - they might be due for some normalization and with remote work distribution in a new one it's hard to predict that outcome. As much as enterprises and CEOs say they want folks back in the office I can promise you the f500 is looking at cancelling as many leases as possible. The cost savings is huge. So expect that trend to continue. 

    Finally, tech has spread to newer cities the last decade like Austin, Dallas, SLC, etc...  With remote work that will continue especially with tech talent shortage (it's still rough) and tech firms drove up north Cali prices in a big way. 

    Lay offs are expected to be sort of hit or miss. Some industries will grow some will shrink - it's reasonable to think we could see mixed pockets in housing also 


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  • Greg R.
    OP
    Investor · Dallas, TX · Member since 2016 · 887 posts · 1k+ votes
    4y
    Quote from @Michael Wooldridge:
    So I do think thats a pretty poor argument for James to make.

     Please let him make it. I want to see the answer. 

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  • John Carbone
    Realtor · Gatlinburg · Member since 2020 · 1k+ posts · 957 votes
    4y
    Quote from @Greg R.:
    Quote from @Michael Wooldridge:
    So I do think thats a pretty poor argument for James to make.

     Please let him make it. I want to see the answer. 


    @James Hamling is too busy fantasizing about nuclear weapons being deployed.
     

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  • Jonathan Feliciano
    Accountant · Miami, FL · Member since 2020 · 89 posts · 57 votes
    4y

    @Greg R.

    Hi Greg. I’m not an expert when it comes to the real estate market, but, given the rise in housing prices and rents, I feel something is gonna give soon. It may not be a “crash”; maybe more so a “correction.” Just my opinion on the matter. Take it with a grain of salt. :)

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  • John Carbone
    Realtor · Gatlinburg · Member since 2020 · 1k+ posts · 957 votes
    4y
    Quote from @Carlos Ptriawan:

    Interest rates are still below 40'ish year average. Slide is a little out dated as the are closer to 6.75 right now

    Hahahaha dude when we're paying the mortgage NOW I don't care about what's the rate my grandpa got 50 years ago LOL LOL

    I could also say today's rate is cheaper than 1928 :) 

    Perhaps some of you guys are either too much money or ignorant about the risk. 


    [ this is one reason I stopped asking in BP for investment advice and use other rationale-investor QP level board to discuss the economy ]

    Please PM me this other board you speak of. My background is in financial risk analysis, I need to get away from realtors trying to sell a product here

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  • Carlos Ptriawan
    Member since 2019 · 7k+ posts · 4k+ votes
    4y
    Quote from @John Carbone:
    Quote from @Greg R.:
    Quote from @Michael Wooldridge:
    So I do think thats a pretty poor argument for James to make.

     Please let him make it. I want to see the answer. 


    @James Hamling is too busy fantasizing about nuclear weapons being deployed.
     


     after the Saudi is cutting OPEC production today :) LOL

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  • Michael Wooldridge
    Member since 2022 · 485 posts · 216 votes
    4y
    Quote from @John Carbone:
    Quote from @Carlos Ptriawan:

    Interest rates are still below 40'ish year average. Slide is a little out dated as the are closer to 6.75 right now

    Hahahaha dude when we're paying the mortgage NOW I don't care about what's the rate my grandpa got 50 years ago LOL LOL

    I could also say today's rate is cheaper than 1928 :) 

    Perhaps some of you guys are either too much money or ignorant about the risk. 


    [ this is one reason I stopped asking in BP for investment advice and use other rationale-investor QP level board to discuss the economy ]

    Please PM me this other board you speak of. My background is in financial risk analysis, I need to get away from realtors trying to sell a product here


     Well that does explain why you are so conservative (negative) in your outlook then. 

    And yeah he lost me big time on Ukraine. there is no way that works out positively period not for a decade plus. After a whole hell of a lot of pain.

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  • John Carbone
    Realtor · Gatlinburg · Member since 2020 · 1k+ posts · 957 votes
    4y
    Quote from @Michael Wooldridge:
    Quote from @John Carbone:
    Quote from @Carlos Ptriawan:

    Interest rates are still below 40'ish year average. Slide is a little out dated as the are closer to 6.75 right now

    Hahahaha dude when we're paying the mortgage NOW I don't care about what's the rate my grandpa got 50 years ago LOL LOL

    I could also say today's rate is cheaper than 1928 :) 

    Perhaps some of you guys are either too much money or ignorant about the risk. 


    [ this is one reason I stopped asking in BP for investment advice and use other rationale-investor QP level board to discuss the economy ]

    Please PM me this other board you speak of. My background is in financial risk analysis, I need to get away from realtors trying to sell a product here


     Well that does explain why you are so conservative (negative) in your outlook then. 

    And yeah he lost me big time on Ukraine. there is no way that works out positively period not for a decade plus. After a whole hell of a lot of pain.

    I was extremely bullish on housing during Covid due to the extreme easing policies. I bought 3 properties during this time. When they change the rules of the game on a dime, the math forces me to adjust to a new reality. 
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  • Michael Wooldridge
    Member since 2022 · 485 posts · 216 votes
    4y
    Quote from @John Carbone:
    Quote from @Michael Wooldridge:
    Quote from @John Carbone:
    Quote from @Carlos Ptriawan:

    Interest rates are still below 40'ish year average. Slide is a little out dated as the are closer to 6.75 right now

    Hahahaha dude when we're paying the mortgage NOW I don't care about what's the rate my grandpa got 50 years ago LOL LOL

    I could also say today's rate is cheaper than 1928 :) 

    Perhaps some of you guys are either too much money or ignorant about the risk. 


    [ this is one reason I stopped asking in BP for investment advice and use other rationale-investor QP level board to discuss the economy ]

    Please PM me this other board you speak of. My background is in financial risk analysis, I need to get away from realtors trying to sell a product here


     Well that does explain why you are so conservative (negative) in your outlook then. 

    And yeah he lost me big time on Ukraine. there is no way that works out positively period not for a decade plus. After a whole hell of a lot of pain.

    I was extremely bullish on housing during Covid due to the extreme easing policies. I bought 3 properties during this time. When they change the rules of the game on a dime, the math forces me to adjust to a new reality. 

    Ehh if you can cash flow good who cares what rates are. Not like we should be planning on selling quickly anyway. 
     

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  • John Carbone
    Realtor · Gatlinburg · Member since 2020 · 1k+ posts · 957 votes
    4y
    Quote from @Michael Wooldridge:
    Quote from @John Carbone:
    Quote from @Michael Wooldridge:
    Quote from @John Carbone:
    Quote from @Carlos Ptriawan:

    Interest rates are still below 40'ish year average. Slide is a little out dated as the are closer to 6.75 right now

    Hahahaha dude when we're paying the mortgage NOW I don't care about what's the rate my grandpa got 50 years ago LOL LOL

    I could also say today's rate is cheaper than 1928 :) 

    Perhaps some of you guys are either too much money or ignorant about the risk. 


    [ this is one reason I stopped asking in BP for investment advice and use other rationale-investor QP level board to discuss the economy ]

    Please PM me this other board you speak of. My background is in financial risk analysis, I need to get away from realtors trying to sell a product here


     Well that does explain why you are so conservative (negative) in your outlook then. 

    And yeah he lost me big time on Ukraine. there is no way that works out positively period not for a decade plus. After a whole hell of a lot of pain.

    I was extremely bullish on housing during Covid due to the extreme easing policies. I bought 3 properties during this time. When they change the rules of the game on a dime, the math forces me to adjust to a new reality. 

    Ehh if you can cash flow good who cares what rates are. Not like we should be planning on selling quickly anyway. 
     

    I personally don’t care about equity, I only care about the cash flow, which as you say is all that matters. The problem with high rates, without prices dropping, it compresses roi for properties. For example, the 3 I bought during Covid, if I bought them now at current rates for same price, they would be making substantially less profit. In my market, 99 percent of listings right now will not “cash flow” at current rates and prices. 
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  • Carlos Ptriawan
    Member since 2019 · 7k+ posts · 4k+ votes
    4y
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  • Michael Wooldridge
    Member since 2022 · 485 posts · 216 votes
    4y

    I personally don’t care about equity, I only care about the cash flow, which as you say is all that matters. The problem with high rates, without prices dropping, it compresses roi for properties. For example, the 3 I bought during Covid, if I bought them now at current rates for same price, they would be making substantially less profit. In my market, 99 percent of listings right now will not “cash flow” at current rates and prices. 

    @John Carbone I mean I want appreciation but it's secondary for me - although I've switched to some more expensive rentals for better long term appreciation (and more cash flow per property even if spend is high).  Area and cash flow matter for me, I still am buying (bit more picky) because I hate the cash in bank. I have to factor in that loss. Might be worth looking out of area. I finally did that. I lose some to property management but the right market nets met good cash flow regardless.

    @Carlos Ptriawan interesting pic. Matches what I've expected. Frankly the south hasn't grown as much as I expected with Texas but it's tough to say. Where is the original source? Would love to see how they split regions. I.e. Florida + Texas should have the south higher.

    The interesting piece about it though the extreme lift on the wst compared to say 2006 - shows that we aren't likely to have a national downturn as much as expected or at least as the west will experience. That's a big difference there... 

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  • Bruce WoodruffPro Member
    Contractor/Investor/Consultant · San Diego / Phoenix · Member since 2021 · 12k+ posts · 15k+ votes
    4y
    Quote from @Michael Wooldridge:
    True that^^^ The money is all that matters.....interest rates are largely irrelevant IMHO...
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  • Chris John
    Member since 2020 · 671 posts · 937 votes
    4y

    I mean, appreciation is nice so that you can refinance and buy more...

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  • Michael Wooldridge
    Member since 2022 · 485 posts · 216 votes
    4y
    Quote from @Chris John:

    I mean, appreciation is nice so that you can refinance and buy more...


     Appreciation is always good of course. It’s safe to say appreciation will also be lower next few years regardless of where you are.

    That said it’s a fair point. For those that are house hacking / building the whole thing from the ground up it’s a little bit different needs & goals. 

    My properties all minimum 25% down if not closer to 40% on some of the 15 years - so goals and needs are different. Although I switched property sizes/values to gain more in the appreciation also recently long term.

    but not turning it down of course but with appreciation being slower, cash flow is going to be king next few years. Even in the PE world cash flow has taken a jump in priority over grabbing market share than worrying about profitability. 




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  • Greg R.
    OP
    Investor · Dallas, TX · Member since 2016 · 887 posts · 1k+ votes
    4y
    Quote from @Michael Wooldridge:
    Quote from @John Carbone:
    Quote from @Michael Wooldridge:
    Quote from @John Carbone:
    Quote from @Carlos Ptriawan:

    Ehh if you can cash flow good who cares what rates are. Not like we should be planning on selling quickly anyway. 

    Cash flow is certainly good, but my strategy is starting to evolve and I'm beginning to be less focused on cash flow and more focused on appreciation. I'll always have cash flowing properties in my portfolio, but I'm seeing more wealth building strategies that are not focused on cash flow. Thanks @Joe Villeneuve

    But to your point, I agree. I really don't care what the rates are when it's time to buy. My reasoning for focusing on rates right now is because that's what's going to drive prices down. Once the prices get where I want them, I'm getting in, I don't care if the rates are 10%. 

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  • Michael Wooldridge
    Member since 2022 · 485 posts · 216 votes
    4y
    Quote from @Greg R.:
    Quote from @Michael Wooldridge:
    Quote from @John Carbone:
    Quote from @Michael Wooldridge:
    Quote from @John Carbone:
    Quote from @Carlos Ptriawan:

    Ehh if you can cash flow good who cares what rates are. Not like we should be planning on selling quickly anyway. 

    Cash flow is certainly good, but my strategy is starting to evolve and I'm beginning to be less focused on cash flow and more focused on appreciation. I'll always have cash flowing properties in my portfolio, but I'm seeing more wealth building strategies that are not focused on cash flow. Thanks @Joe Villeneuve

    But to your point, I agree. I really don't care what the rates are when it's time to buy. My reasoning for focusing on rates right now is because that's what's going to drive prices down. Once the prices get where I want them, I'm getting in, I don't care if the rates are 10%. 

     Appreciation depends on the long term goals of course. I will say I’ve switched to more expensive properties ot net more appreciation, also higher cash flow per property which is less management long term.

    But even at 38 any way I slice the numbers. Financially speaking I can’t see the value in selling off the properties and dropping everything into funds and living off interest. For example if all my properties are 100% paid off at 70 (depending on various personal cash flow plans). even paying myself, and an accountant/manager/family member - the extra cash flow (not going to properties) nets up very good for creating it’s own funds down the road.

    Now all that said, I  haven’t explore long term trusts and inheritance laws yet. So I need to look at that. but frankly I’m not sure I ever want to sell if I can keep the management down/managed through hires. 
     

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  • Greg R.
    OP
    Investor · Dallas, TX · Member since 2016 · 887 posts · 1k+ votes
    4y
    Quote from @Chris John:

    I mean, appreciation is nice so that you can refinance and buy more...

    Appreciation isn't just nice, it's necessary if you want to grow at a good pace. Take away the last couple years and a lot of the high cash flowing mid-west properties generally appreciated very little making it difficult to scale. In places like CA (for example), you can gain a tremendous amount of equity quickly - and not during a bubble either - in regular times. 

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  • Greg R.
    OP
    Investor · Dallas, TX · Member since 2016 · 887 posts · 1k+ votes
    4y
    Quote from @Michael Wooldridge:
    Quote from @Greg R.:
    Quote from @Michael Wooldridge:
    Quote from @John Carbone:
    Quote from @Michael Wooldridge:
    Quote from @John Carbone:
    Quote from @Carlos Ptriawan:

    Ehh if you can cash flow good who cares what rates are. Not like we should be planning on selling quickly anyway. 

    Cash flow is certainly good, but my strategy is starting to evolve and I'm beginning to be less focused on cash flow and more focused on appreciation. I'll always have cash flowing properties in my portfolio, but I'm seeing more wealth building strategies that are not focused on cash flow. Thanks @Joe Villeneuve

    But to your point, I agree. I really don't care what the rates are when it's time to buy. My reasoning for focusing on rates right now is because that's what's going to drive prices down. Once the prices get where I want them, I'm getting in, I don't care if the rates are 10%. 


     Appreciation depends on the long term goals of course. I will say I’ve switched to more expensive properties ot net more appreciation, also higher cash flow per property which is less management long term.

    But even at 38 anyway I slice the numbers. Financially speaking I can’t see the value in selling off the properties and dropping everything into funds and living off interest. For example if all my properties are 100% paid off at 70 (depending on various personal cash flow plans). even paying myself, and an accountant/manager/family member - the extra cash flow (not going to properties) nets up very good for creating it’s own funds down the road.

    Now all that said haven’t explore long term trusts and inheritance. So I need to look at that. but frankly I’m not sure I ever want to sell if I can keep the management down/managed through hires. 

    Definitely good to plan for retirement. I strongly doubt that SSN will be a thing when you and I would be able to draw from it. 
    And I agree about the higher priced/ move valuable properties. When they appreciate, the return will be much more significant compared to the less valuable properties. 
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  • Michael Wooldridge
    Member since 2022 · 485 posts · 216 votes
    4y
    Quote from @Greg R.:
    And I agree about the higher priced/ move valuable properties. When they appreciate, the return will be much more significant compared to the less valuable properties. 
    So I’m planning for retirement approx 55 :). sort of depends on a few factors could be early a few years or later like 58. I make a good living but have a very high stress job so I want out one day but not just with my income replaced but more and the ability to grow the business. So sometime in my 50’s I’m out or on to like a 20 hour a week advisory gig. 

    I’m sure SS will be around. Probably reduced payout something like 28% less which is fine. It’s good car money in my book. But I’ve never been counting on it. 
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  • Carlos Ptriawan
    Member since 2019 · 7k+ posts · 4k+ votes
    4y
    Quote from @Michael Wooldridge:

    I personally don’t care about equity, I only care about the cash flow, which as you say is all that matters. The problem with high rates, without prices dropping, it compresses roi for properties. For example, the 3 I bought during Covid, if I bought them now at current rates for same price, they would be making substantially less profit. In my market, 99 percent of listings right now will not “cash flow” at current rates and prices. 

    @John Carbone I mean I want appreciation but it's secondary for me - although I've switched to some more expensive rentals for better long term appreciation (and more cash flow per property even if spend is high).  Area and cash flow matter for me, I still am buying (bit more picky) because I hate the cash in bank. I have to factor in that loss. Might be worth looking out of area. I finally did that. I lose some to property management but the right market nets met good cash flow regardless.

    @Carlos Ptriawan interesting pic. Matches what I've expected. Frankly the south hasn't grown as much as I expected with Texas but it's tough to say. Where is the original source? Would love to see how they split regions. I.e. Florida + Texas should have the south higher.

    The interesting piece about it though the extreme lift on the wst compared to say 2006 - shows that we aren't likely to have a national downturn as much as expected or at least as the west will experience. That's a big difference there... 

    This is more interesting.
    Michael take a look at this chart from JPM. So the biggest increase in August inflation is actually coming from OER (New Owner Purchase Mortgage).
    And look at the chart on the right.

    So there's chicken and bull problem here : for the  inflation to go down, the CPI could go down primarily ONLY if housing price is adjusted
    Lower !!!

    So if we expect west coast homes to drop in value to JAN 2021 pricing (10-15%) then the CPI may go down, then the Fed may reduce rate  LOL.

    If we follow "Fed calculation", it seems Greg's scenario is making more sense now, the faster the crash/price adjustment , the better would be 
    For inflation/fed.




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  • Michael Wooldridge
    Member since 2022 · 485 posts · 216 votes
    4y
    Quote from @Carlos Ptriawan:
    Quote from @Michael Wooldridge:

    I personally don’t care about equity, I only care about the cash flow, which as you say is all that matters. The problem with high rates, without prices dropping, it compresses roi for properties. For example, the 3 I bought during Covid, if I bought them now at current rates for same price, they would be making substantially less profit. In my market, 99 percent of listings right now will not “cash flow” at current rates and prices. 

    @John Carbone I mean I want appreciation but it's secondary for me - although I've switched to some more expensive rentals for better long term appreciation (and more cash flow per property even if spend is high).  Area and cash flow matter for me, I still am buying (bit more picky) because I hate the cash in bank. I have to factor in that loss. Might be worth looking out of area. I finally did that. I lose some to property management but the right market nets met good cash flow regardless.

    @Carlos Ptriawan interesting pic. Matches what I've expected. Frankly the south hasn't grown as much as I expected with Texas but it's tough to say. Where is the original source? Would love to see how they split regions. I.e. Florida + Texas should have the south higher.

    The interesting piece about it though the extreme lift on the wst compared to say 2006 - shows that we aren't likely to have a national downturn as much as expected or at least as the west will experience. That's a big difference there... 

    This is more interesting.
    Michael take a look at this chart from JPM. So the biggest increase in August inflation is actually coming from OER (New Owner Purchase Mortgage).
    And look at the chart on the right.

    So there's chicken and bull problem here : for the  inflation to go down, the CPI could go down primarily ONLY if housing price is adjusted
    Lower !!!

    So if we expect west coast homes to drop in value to JAN 2021 pricing (10-15%) then the CPI may go down, then the Fed may reduce rate  LOL.

    If we follow "Fed calculation", it seems Greg's scenario is making more sense now, the faster the crash/price adjustment , the better would be 
    For inflation/fed.




    Honestly, I can't say I'm surprised. I mentioned my first property I now rent was an FHA. I bought it nothing down and moved in 2010. Fast forward to the last 2 I bought in that complex - we were all cash offers and fast closes but took loans out of course. Those properties rented in hours (with huge price hikes). They are cash flow in machines for investors. BUT they are blocking out first time buyers. I've moved on to bigger properties with more cash flow but candidly they are guarunteed rental, low risk to appreciation but not as much appreciation - and great cash flow so it's an investor dreams.

    Frankly first time buyers got pushed out by all the investors. I suspect when things took a turn for the worse they jumped back in. Which I think will continue because even at higher rates it’s affordable on the low end of market. 

    But yes at this point inflation is primarily being driven by properties. Hopefully with rent hikes finally being fully prices in + rate hikes we should see it lower. but the reason why fed wants job losses is to hurt the ability to buy. With all the wage hikes and low employment participation rates - people are just having no issues making decent money rihgt now. 

    What I think the fed is being a little blind to or not hoping is not realizing how much unemployment it would take to shift things. Especially when compared globally to economic impact. there is no soft landing in that scenario. So they are walking a tight rope. 

    That said fed seemed ot indicate they might slow on rates. So next Fed meeting will be interesting. 

    @Carlos Ptriawan do you have bigger pictures and/or links to the source? hard to see. 

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