All Forum Posts by: Richard Foxx

My house is worth 200k more than pre-COVID, but that's sustainable?

New York people have already relocated, Millenials didn't have the $$$ to cover a $1000 expense but that's reason for property values to increase YOY?

Laughable,  but it's going to be fun being right 

Ps. I am in a Default Organization that had a private conference recently,  and there was no shortage of mortgage servicers in attendance.  (The rest is covered by a NDA so that is all I can disclose)

Also had mortgage insurance/PMI companies there, you can guess "Why"

Cheers!

When house prices outpace incomes, reversion to the mean happens 

Everything else is simply Noise or the RE Industrial Complex trying to sustain the narrative. 

I made 23k last month brokering mortgages,  and income from my RE Brokerage on top of that. 

But I'm older and wiser, so not buying boats/Benzs/etc this time 

The Demand side doesn't care about Supply, when Buyer Sentiment changes  , and it already has,  inventory is guaranteed 

I'd love things to keep on rolling. But eventually you run out of suckers to buy 500k houses

Cheers!

Any stats prior to 1971 are irrelevant.  That's when we came off the Gold Standard and the Fed has been messing with the money supply ever since. 

I got popcorn and $$$ for this train wreck. 

5000 evictions scheduled for this weekend in Tampa Bay alone.

How many frustrated landlords are going to List ASAP?

All the smart ones. We're about to get more inventory than we need. 

Edit - it should be noted that we didn't really see a constant up and down cycle every 12-14 years, until we went off the gold standard in the 1970s. 

Great read is Milton Friedman's "Money Mischief"  which goes all the way back to Roman times for inflation and debasing of currency. 

Also - Stocks had quite a rocky ride in the 50's, 60's and 70's, all the way to the dot-com bust in 2000, which was the lead in to the real estate runup to 2007, rates were held too low for too long. Subprime was a sideshow, derivatives were the real timebomb, read Liar's Poker and The Big Short.

Apologies that my opinion doesn't fit the current media and public narrative, I don't follow the Herd.

When I started in 1995, it was the bottom of the last cycle, happens every 12-14 years, previous to Subprime it was the S&L crisis

Very well documented if you do a bit of research.  

I remember my processor telling me "stated income is illegal"  when I showed her lender programs, in 1995. Because it existed prior and pooped up again around 95, though limited in scope, it grew quickly.

"

The first major housing bubble in US history occurred in 1837, coinciding with a stock market that also peaked right around the time housing prices did. Once both stock and housing prices crashed, banks got super-cautious with their lending (sound familiar?) and held on to their reserves of cash, silver, and gold.

Speaking of gold, though, the 1849 Gold Rush put more of this into circulation, which again drove up housing prices and caused yet another bubble. Railroad stocks drove the boom-bust cycle of the 1850s, but the Civil War put most economic speculation on ice for the duration.

The Reconstruction era saw yet more booming and busting, culminating in the crash of 1879. Things picked up again in the Gilded Age 90s, and then again in the Roaring 20s, which ended in the worst stock market crash since…well, ever.

Needless to say, home values were on the low side throughout the Great Depression years and didn’t pick up much until Johnny came marching home from WWII. The 1970s and 1990s saw further ups and downs, but the nation’s most notorious real estate bubble of modern times started blowing up in 2002."

I've been in the biz since 1995, rode out 2007-2008, and was a Fannie Mae Broker for REO's.

What most people are missing is rather obvious - DEMAND will disappear at some point, and then inventory grows, and prices drop. Everyone can't buy a 500k house, ain't gonna happen.

The 2nd point - the whole "this time is different" because of no Subprime, etc, is flawed, when we were listing REO's right up until 2019, at LEAST 50% were people with good loans, who strategically defaulted.

Not subprime at all.  

They hired attorneys and lived for free, then bought in their spouses name and bailed near the end. 

Having to prove a transaction wasn't a "Buy and Bail" was actually a loan underwriting requirement for Fannie/Freddie loans at one point, it was that common. I'm saying this as a caution to those who think subprime caused everything - in reality, subprime was the catalyst (ie, COVID today) and as the equity disappeared, people defaulted in droves, as soon as it became Socially Acceptable to do so.

COVID essentially just gave everyone a free pass to default, and not be embarrassed. 

4th qtr 2021 is the concensus, among those I still talk to regularly in the Default Servicing space(I used to own a mortgage lender/servicer company, back in2007, got out with my skin but barely. Still have a lot of banking connections.)

Evictions start July 1st, buckle up and enjoy the show.  

You can most definitely talk direct to his attorney, even if he did hire him formally, you're a party to the lawsuit.  Would be funny to run up some attorney time @$300/hr and the tenant is responsible.  Just assume everything is being recorded by the attorney(it won't be) and act accordingly on the phone. 

I have established LLC credit, but did have to personally sign for the first loan. LLC's - these flow right to you with zero tax effect, unless you designate it as a "S" corp for taxes, dunno where the idea of a K1 is coming from, never came up with me, and I've had 10+ in operation over the last 25 years. LLC's are "disregarded entities" if it's a single-member LLC, for tax purposes.

Is the premium membership worth it?  (no Property Onion sales pitches please if you work for them, thx)