I think the bubble is popping.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Mortgage applications sink to their lowest level since before the pandemic hit

https://www.cnbc.com/2021/07/07/mortgage-applications-sink-to-lowest-level-since-before-pandemic.html

Falling mortgage rates didn’t spur demand.

RedFin data shows major slowdown of houses sold in the last month or so while inventory increased.

Which is good, all the pandemic did was move up peoples timelines to move from the city to the burbs. They did it all at once hence the scramble. That demand has been satiated to a large part. You aren’t seeing investors buying multiple homes or other nonsense like in 2005.

Redfin data also indicates that suburban buyers are very stretched. In Bethesda and Arlington zip codes I checked, down payments are only averaging about 10%. In DC it’s a different story. All of the high demand and competitive neighborhoods have at minimum 20% average down payment and many, like CCDC are 30%+. Suburbs look to be maxed out.

With interest rates this low down payment percentage seems like a strange method of determining who "has money" or not. Who is to say someone putting down 10% is doing it because that's all the money they have or because they decided to keep their money in a market that has averaged 40% returns in the preceding 12 months?

I'm not in the market for a house right now, but if I was, I'd be putting the bare minimum down for a competitive offer. You can always pay off your mortgage early, but you can't recoup lost opportunity cost in the market.

[Anonymous]

Bubble most definitely not popping in DC. A house in North Cleveland Park went under contract last week for allegedly $400,000 over asking.

[Anonymous]

Prices are going crazy in desirable parts of DC. Look at places like CCDC, CP, and AU Park. Houses that went for 1mm 2 years ago are consistently going for 1.3-1.5.

[Anonymous]

Lumber down 60% from highs...

[Anonymous]

Anonymous wrote:Lumber down 60% from highs...

The problem is that although lumber is down, the trades are charging a ton so labor is up massively. The reason being that supply and demand is such that they can turn down jobs.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Lumber down 60% from highs...

The problem is that although lumber is down, the trades are charging a ton so labor is up massively. The reason being that supply and demand is such that they can turn down jobs.

And that will normalize quickly as well. Either they will come down in price, or new entrants will come in at a lower price to grab their business.

Cycle of life.

[Anonymous]

Anonymous wrote:The only people who think there will not be a steep market correction are real estate professionals and people who just bought houses.

The market slows at the height of the summer every year. I firmly believe a market correction is in the near future regardless.

If by "steep market correction" you mean a drastic DROP in prices, I think you're deluding yourself. I've heard that same argument so many times over the past 20 years I've lost count. Now if you're talking about prices levelling out to be somewhat flat, that I could buy. But inevitably, they will start rising again down the road.

[Anonymous]

Anonymous wrote:

Anonymous wrote:The only people who think there will not be a steep market correction are real estate professionals and people who just bought houses.

The market slows at the height of the summer every year. I firmly believe a market correction is in the near future regardless.

If by "steep market correction" you mean a drastic DROP in prices, I think you're deluding yourself. I've heard that same argument so many times over the past 20 years I've lost count. Now if you're talking about prices levelling out to be somewhat flat, that I could buy. But inevitably, they will start rising again down the road.

Maybe. If the argument for higher prices is lower interest rates, well, there is a zero bound to interest rates, and we're almost at it. Not much room to fall anymore.

And there is no other argument.

Hence...

[Anonymous]

Anonymous wrote:Prices are going crazy in desirable parts of DC. Look at places like CCDC, CP, and AU Park. Houses that went for 1mm 2 years ago are consistently going for 1.3-1.5.

So true! CCDC house values are amazing right now. There’s no inventory for starter homes. I checked and there’s two parcels of land that are not huge and priced at 1.1 and 1.3 million.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Lumber down 60% from highs...

The problem is that although lumber is down, the trades are charging a ton so labor is up massively. The reason being that supply and demand is such that they can turn down jobs.

And that will normalize quickly as well. Either they will come down in price, or new entrants will come in at a lower price to grab their business.

Cycle of life.

I hope you’re right. Have had a piece of land in CCDC and have wanted to do a custom build and right as I’m ready to pull the trigger prices have exploded. Your jaws would drop at what the top tier builders are quoting per square foot today.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Prices are going crazy in desirable parts of DC. Look at places like CCDC, CP, and AU Park. Houses that went for 1mm 2 years ago are consistently going for 1.3-1.5.

So true! CCDC house values are amazing right now. There’s no inventory for starter homes. I checked and there’s two parcels of land that are not huge and priced at 1.1 and 1.3 million.

Even rentals there’s no inventory. I have 3 sfh rentals in CCDC that have been in the family for ages and two of them came available over the last 5 months. I had more than 100 applications between the two of them to sift through…

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Lumber down 60% from highs...

The problem is that although lumber is down, the trades are charging a ton so labor is up massively. The reason being that supply and demand is such that they can turn down jobs.

And that will normalize quickly as well. Either they will come down in price, or new entrants will come in at a lower price to grab their business.

Cycle of life.

I hope you’re right. Have had a piece of land in CCDC and have wanted to do a custom build and right as I’m ready to pull the trigger prices have exploded. Your jaws would drop at what the top tier builders are quoting per square foot today.

Top tier builders have and always will quote "jaw dropping" prices for custom builds. That's not going to change.

What will change is this insanity in raw material costs, handymen trying to screw you over for simple tasks (like building a deck), tract housing/standard new builds etc etc. That will normalize.

[Anonymous]

The only popping you hear is the champagne corks at the local Long & Foster office. The DC real estate market will continue to experience lower inventory and higher prices. "Wait until 2022 when the market falls 40%"- not happening. The potential runaway inflation will drive prices higher and higher.

[Anonymous]

whoever above posted the harry dent "the crash is coming the crash is coming" should take a look at his historical performance....


Launched in June 1999, AIM Dent Demographics Fund had significant first year gains. Its subsequent performance was lackluster, however, and in July 2005, it was merged into another AIM offering.

His 2011 book goes on to suggest consumer spending will begin to plummet in 2012 with the Dow bottoming out somewhere between 3,000 and 5,600 in 2014. (average in 2014 was over 16000)



In 2012 the "Dent Tactical Advantage ETF," symbol DENT, was de-listed having consistently under-performed the market for three years while at the same time charging an egregiously high 1.65% management fee.


In 2012, he began writing weekly articles for the free investment newsletter Survive & prosper, now known as: Economy & Markets, which offers investment advice guided by his belief that a major economic crash is inevitable and that it will drop the DOW all the way to 3,300. As of early 2013, he has amended his predictions slightly to an expectation that the financial crash will begin between the end of 2013 and the first half of 2014. (the dow hasn't been below 10,000 since 2009)


In 2013, Dent predicted the market would crash again in the Summer of 2013 and would take a further year and a half to recover.

In 2014, while promoting his book The Demographic Cliff in Australia, he predicted a major Australian housing market correction beginning in 2014 after an even bigger one in China. (housing has gone up 40% n austrlia and 99% in China)

He also predicted that the price of gold would fall to USD$700 an ounce, and has since revised this prediction to 2017. (Gold hasn't dropped below 800 since 2006)


On December 10, 2016, Dent predicted that the Dow Jones Industrial average could fall 17,000 points as a result of Donald Trump's election win. Less than two weeks later, Dent reversed his opinion and thinks there is short term growth for the US stock market, but demographic forces will keep the economic growth stagnant in the longer term. (this...did not happen).

[Anonymous]

Anonymous wrote:Bubble most definitely not popping in DC. A house in North Cleveland Park went under contract last week for allegedly $400,000 over asking.

Was it the one on Albemarle?