Moody's says Home prices will fall 20% soon

[Anonymous]

Why is being an economist a profession anymore. Just troll on DCUM and you can find several.

Is this statement true, I think not!

[Anonymous]

Well, the two houses in my neighborhood that have closed in the past month went for 25% MORE than what we bought our house for last summer, so I suppose you could be accurate. Prices could go back down to where they were last summer.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Between 1900 and 2000 real estate appreciated at about the rate of inflation, maybe add < 1%. Not true for 2000-2022. But I expect after some time goes by, we will look back and say "Hey, from 1900 to 2050, real estate appreciated by about the rate of inflation, maybe add < 1%""

good. hopefully we will start building more too. things like the 'missing middle' movement and navy yard development are starting to make a difference

There is no “middle middle” or “housing crisis” only an entitlement mentality crisis. People can’t find housing only because they are not willing to live where they can afford. This is all a ruse by developers, building companies and real estate agents to make money.

[Anonymous]

Anonymous wrote:Well, the two houses in my neighborhood that have closed in the past month went for 25% MORE than what we bought our house for last summer, so I suppose you could be accurate. Prices could go back down to where they were last summer.

This thread began a year and a half ago so is definitely wrong.

[Anonymous]

“Nominal prices (inflation adjusted)” is a contradiction. “Inflation adjusted” are real prices. Which can and likely will fall.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Well, the two houses in my neighborhood that have closed in the past month went for 25% MORE than what we bought our house for last summer, so I suppose you could be accurate. Prices could go back down to where they were last summer.

This thread began a year and a half ago so is definitely wrong.

Haha. I remember this thread. Thanks for bumping.

Told you so, OP.

[Anonymous]

OP was so wrong. Thanks god I didn’t listen.

[Anonymous]

I doubt it will happen even if it did meaningless.

Homes sold in 2019 for one million bloated up to 1.5 million falling in value 20 percent to 1.2 million yawn

[Anonymous]

That prediction didn't age well, did it?

[Anonymous]

Anonymous wrote:I believe it. Prices aren’t sustainable with 6% interest rates.

Hahahahahahaha

[Anonymous]

Looking back this seems like an insane prediction given the increase in the money supply and government spending.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I believe it. Prices aren’t sustainable with 6% interest rates.

Hahahahahahaha

8 percent was normal for a very long time

[Anonymous]

Anonymous wrote:That prediction didn't age well, did it?

It aged as well as the buying shark thread.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Twenty percent? In this area?

Regardless of “real value” I don’t think investors who can pay cash, homebuyers who don’t need large mortgages, or even regular old 20% down homebuyers would wait until prices around the DMV dropped 20 percent before purchasing real estate. I think that if prices dropped 10%, tops, they will assume it’s being sold at a discount if you’re thinking long-term.

Affordability for anyone taking out a mortgage has sunk - with monthly payments basically doubling. I agree with you on cash buyers but what percent of the market is that really?

Investors bought 24% of all single family homes last year.

https://www.pewtrusts.org/en/research-and-analysis/blogs/stateline/2022/07/22/investors-bought-a-quarter-of-homes-sold-last-year-driving-up-rents

And obviously if the market tanks further that is only going to increase. So I think that cash buyers are a portion of buyers significant enough to move the needle as far as housing prices go, even in markets where you're not getting fire sale prices.

You would think there would be more investor activity if the market tanks but in my experience they panic and try to limit their losses. There were no investors in sight when we were buying in 2010. It’s counterintuitive but people usually join the bandwagon when it’s the worst possible time - 2006 and again in 2021-2022.

Oh duh. That is a good point. They do do that.

PP here again. But 20%? That just seems crazy that people would let a south Arlington house that sold for 1M this year get down to 800K. I don't think I'm a particularly good investor but even with a mortgage I'd be tempted to buy a house at that kind of discount.

$1M borrowed at 3.5% = $4490
$750K borrowed at 6% = $4479

This down market has some legs, imho. Prices have not really adjusted yet to reality.

This is the math that many people on this site don’t seem to get (or prefer to ignore). Prices were clearly artificially propped up by INSANELY low rates.

If buyers are anything like me, they bought up with their low interest rates. We looked at houses that we never would have looked at when interest rates were 4-5%. If we were looking at houses now, we'd just be looking at different houses and different neighborhoods than we ended up buying in.

[Anonymous]

Anonymous wrote:

Anonymous wrote:That prediction didn't age well, did it?

It aged as well as the buying shark thread.

I wonder how the shark made out this last year and a half. Miss that guy