Reply to When do you think housing prices will drop (or never)?

Forum Index » Real Estate

Reply to "When do you think housing prices will drop (or never)?"

Subject:

Emoticons





More smilies

Text Color: Font: Close Marks

[quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous]We bought a 1.3mil house in close in McLean in early 2019, we refinanced at 2.75 and our mortgage is $5400. Per Redfin our home is now worth 1.6mil, I am not convinced at the appreciation. I think it will go down at least 100k.

Today, If someone were to buy 1.3 mil house at 6.4% at 25% down the payment comes to around $7500.00 and at 1.6m monthly payment is around $9200. I am not convinced that there are lots of people out there with the capacity to pay between 7500 -9500 a month in mortgage payment. I think this pool is limited and will shrink further due to rising interest rates.

FWIW, our HHI is 750k and I would never pay mortgage above $6000/month. Maybe I am an outlier but numbers don’t support the argument that prices will hold, I think they will come down 10% at least even in close in areas and that’s okay because the increase was beyond crazy.[/quote]

And at the other end of the market, we needed a mortgage under $2000 and bought a very small older place to get that. With interest rates that literally isn't possible right now. [/quote]

PS to be clear I think two trends we are seeing will go further. 
1) Prices will decline somewhat. It's happening already. It's going to make it hard for people to move up from their current homes or sell.

2) [b]More properties will be bought as investments and rented out - my neighborhood is seeing this already, most 2021 sales are now AirBnBs.[/b] This makes it even harder for low and middle income people to buy by decreasing supply and keeping prices higher than they would be in a purely residential market. [/quote]

This is happening because people don’t want to sell into this market and they think they can wait out high interest rates. As a result, the AirBnB market is saturated and owners aren’t seeing the returns they were during Covid. At some point the investors that bought rental property based on Covid income are going to have to sell.

https://www.wsj.com/articles/the-housing-slowdown-is-wreaking-havoc-on-the-short-term-rental-market-11670518837?reflink=integratedwebview_share

[/quote]

Options

	Disable HTML in this message
	Disable BB Code in this message
	Disable smilies in this message

Review message

Search Recent Topics Hottest Topics