All Forum Posts by: Billy Smith

Home sales will drop, the housing shortage could become the worst in U.S. history, and home values will shrink in some cities. That’s the 2020 forecast from realtor.com, which holds one of the largest databases of housing statistics available.

Sales of existing homes will fall 1.8% from 2019, according to the forecast. Home prices will flatten nationally, increasing just 0.8% annually, but prices will fall in a quarter of the 100 largest metropolitan markets, including Chicago, Dallas, Las Vegas, Miami, St. Louis, Detroit and San Francisco.

It is a seemingly contrary assessment, given the current strength of the economy and of homebuyer demand, but the dynamics of this housing market are unlike any other — the result of a housing crash unlike any other.

“Real estate fundamentals remain entangled in a lattice of continuing demand, tight supply and disciplined financial underwriting,” said George Ratiu, senior economist at realtor.com. “Accordingly, 2020 will prove to be the most challenging year for buyers, not because of what they can afford but rather what they can’t find.”

It’s all about supply. The inventory of homes for sale has been falling steadily for several years and is at its lowest on the lowest end of the market. That caused prices to overheat, weakening affordability. The 2020 forecast offers no relief, in fact just the opposite. As demand heats up in the spring, driven by the growing number of millennials entering the market, the supply of homes for sale could hit its lowest in history. The situation will only be exacerbated by the baby boom generation, which, according to the forecast, will have little incentive to sell, given weaker home prices.

“While millennials share many similar traits with prior generations, they have been marked by a delay in major life milestones, including starting a family and purchasing a home,” said Ratiu. “Millennials not only purchased a higher-priced first home but faced with growing families, many of them skipped the traditional starter home and moved straight to a mid-priced, trade-up home.”

That dynamic will continue in 2020 and added pressure on the middle range of the market. Millennials will dominate the housing market, accounting for 50% of all mortgages by spring, according to the forecast. Just short of 5 million millennials will turn 30, which is when many people buy their first home, and the oldest will turn 39, generally when family dynamics kick in and people move to larger homes in the suburbs.

Single-family construction will increase in 2020, up 6% annually, according to the forecast, but that will not alleviate the supply crunch. Part of that is due to the very slow recovery of the nation’s homebuilders, who began rebuilding their businesses after the historic housing crash mostly in the move-up and luxury markets.

On the bright side, builders are well-positioned to increase profits thanks to the shortage of existing homes for sale.

“We believe homebuilders are poised to enter 2020 with some of the strongest supply/demand fundamentals we’ve seen in the 10-year housing recovery to date,” Raymond James housing analyst Buck Horne wrote in an October note to investors. “Homebuyers responded convincingly to lower mortgage rates this summer, leading to a re-acceleration of home price appreciation across most markets.”

Sellers, however, have yet to meet the incremental demand with additional new supply in most markets, Horne noted.

More homeowners are staying longer, according to real estate brokerage Redfin, which analyzed Census data. The typical American homeowner has spent 13 years in their home, up from eight years in 2010, as more households are choosing to age in place.

The supply of entry-level homes is also well below historical levels because during the foreclosure crisis, investors bought millions of distressed properties and turned them into rentals. The bulk of these properties were on the lower end of the price spectrum. The expectation was that as home prices recovered, investors would sell the homes, pocket the profits and return the housing supply to its previous level. That did not happen. The single-family rental market was so strong that investors held the homes, built large-scale, multicity service and maintenance platforms and created a new asset class for even bigger investors to fuel.

“The supply of rental properties has risen in tandem with demand, while new residential construction has lagged, placing the rental market in a good position to offer alternatives for buyers priced out of their markets,” said Ratiu. “However, the affordability challenge will continue to cast a shado

https://www.cnbc.com/2019/12/04/harsh-housing-forecast-for-2020-especially-in-these-big-cities.html

Tip toe into a small rental ,grab a realtor and jump in .I would never mention how much money you have, keep that to yourself .

Landing a dream job is difficult you need to take some form of income tell you get that part  figured out .

Blue collar jobs are yelling for help take you pick Google what looks good .

Experience  is the catch 22 so expect to make less tell you are are worth more .

I must chine on always buy combo smoke/Co2 alarms .

Must issues of alarms going off all the time is too close to the stove.

That brings up if you had a proper stove  vent hood to the out side that would cut down on alarms going off all the time .

Set your alarm close to the kitchen but not too close  so if the stove has issues the alarm will go off quick .

Check out KCMO 

https://www.biggerpockets.com/forums/706/topics/589985-invest-rental-property-in-kansas-city-mo

Had partner who did get scammed caught it froze the wire transfer.

The title company has their email hacked.

Some folks are getting scammed and not being made whole by the title company

I say send overnight check no more wire transfer tell they get a hold on it.

I would do a 30 always pay off early make it a 12 year  .Some of folks do not have the ability to  manage money  to pay off early .

Inspect the panel see if it is up to code ,you will need a code person to check off on the work .

If he /she flunks it find why and fix  the issue ,might be a fine in there you will need to bite the bullet get this behind you .

I have moved houses when I was young man in the early 80s.

The houses we bought were dirt cheap so moving them made sense most of the time.

You may need to pull permits to move power lines and whatever the house may hit while moving it.

I would make sure all is good having a bad experience could mean they are the problem not the agent.

You will need lots of permits hooking up sewers, electrical etc. that gets pricey really quick.

Have some knowledge person check the wiring, plumbing, look for lead paint, asbestos.

The drywall will crack up big time.

Check for liens might get a lawyer to help.

Knob and tube are not safe because the heat form the electrical current over 100 years breaks down everything becomes brittle /FIRE Hazard!

With no ground then that can be a shocking surprise and it does not feel good around water it can kill.

With State Farm they will inspect the electrical panel they then say fix it or no coverage.

Some flippers will cobble together old wire with new using junction boxes to try to sneak around an inspection then play dumb if they get caught.