Anonymous wrote:

Anonymous wrote:I just don’t get how prices will fall when supply is so low.

The demand has absolutely slowed down. People are losing their jobs especially tech. Along with being a Fed hub, DC is also a tech hub. And those who haven't lost their jobs aren't making any large purchases right now especially at 7% rates.

Not only tech.. Geico shutdown their entire offices in this area.

Anonymous wrote:I just don’t get how prices will fall when supply is so low.

Demand is even lower.

Anonymous wrote:We're looking (not urgent) and inventory is...fine really. Up from last year really. Prices are falling a bit. But they need to fall more to make up for the increase in payments were looking at due to rate increases (almost $1,500 a month on the ~1ms were looking at!).

We're hoping we find something in the spring and are not stressed about it.

This assumption doesn’t make sense to me. This implies you have the right to buy a certain size/location whatever of house. People who need to buy will just have to buy less house than before. Rates were artificially low

I think I agree with PP—I think inventory will be very tight because no one is going to move until they really have to. Lots of people with shaky marriages will stay out rather than give up that sweet sweet interest rate!
I don’t wonder if we will see a sharp increase in renters in SFH areas and/or people converting houses to duplexes. Both of those were really common pre-Ww2 when it was much tougher to get mortgages. That’s what my grandparents did. That sort of system makes a lot of sense in this sort of market I think.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:The headline is more alarming than the content. Most of the people surveyed say a 10-20% drop in housing prices. I would say we’ve already seen about a 10% drop in prices in the DMV, uneven across areas but if you look at all the price cuts prices even in desirable areas seem to me to be about 10% lower than they were say six months ago.

This, and for people who bought before 2019, this will basically only wipe out the steep increase in prices over the last couple years but will not touch the equity they built before that. Meaning you can still sell a house for a profit after owning it for 5-7 years at a minimum. The housing market can never sustain steep price increases for long.

The only people who should be freaking out right now are people who bought within the last two years and want or have to sell in the immediate future -- they may take a bath. Also, people who have been waiting for prices to return to 2010-2011 levels are in for a rude awakening -- even with rate increases, that is unlikely to happen because of inventory. Unlike in 2008/2009, this housing "crash" is not fueled by overbuilding housing stock in hot markets (back then, it was places like Las Vegas and Florida, where developers built thousands of new houses knowing they could sell them to people for little to no money down). We also aren't seeing rippling economic effects leading to mass layoffs. A slowdown in hiring, yes, and some targeted layoffs in some industries, but not the domino effect of the last time.

Yeah, like the poster on here who constantly talks about “reverting to the mean”. Gonna be waiting for that “revert to mean” forever, buddy. It’s not going to go down that low in this area. Unless they’re posting from Austin, TX or Boise, ID. Too many folks not wanting to sell and give up their 2.5-3.5% interest rate.

Blah Blah Blah...

Your friendly (non-conforming) realer here. Miss me guys? Sorry, was on the islands with the family.

It IS going to be a bloodbath. EVERYWHERE. Not just DC, NY, SF, LA or...name your favorite locale. It's gonna be everywhere. Why?

The current economy (including housing) is BUILT on low interest rates. It's a house of cards. If interest rates start going up (Holy shit! They did!) the entire house of cards comes down. EVERY single person here who says "nah...not in my neighborhood or...not in the DMV...or whatever" is in denial. However, there is no way to convince a person who is in denial that they are wrong.

Read between the lines, be smart, be prudent, and do NOT listen to the BS posted here (or in some of the similar online boards). 40 year trend lines don't break because Powell says so. They break because there's a seismic shift underway.

Decide accordingly.

Do you own a home?

I do, and the reason I think you're wrong is not because I think my neighborhood is special or something. It's because I own a home that I bought when interest rates are low, we can comfortably afford the mortgage with our current HHI, and that HHI is fairly recession proof because 70% of it is a mid-career government position that will never be laid off. Ever. Worst case scenario, we lose the 30% private sector income for some period of time, in which case we know we could still swing the market (again, low rate locked in) and we'd just buckle down in other areas to ride it out.

We were contemplating selling when rates went up, but now won't because prices are weird plus we don't want to have to buy at the higher rates now. So we'll sit tight and keep paying our mortgage. And so will all the many, many people like me. Will some people be forced to sell because they are moving or getting divorced or hate their schools or something? Sure (though at least some percentage of those people will just rent out their homes, which is something you see a lot of now). And there are others who will be forced to sell because they are over leveraged even at their low rates, and if they lose their jobs or their business takes a dive, they won't be able to afford their mortgage.

But if you actually think that's going to be the majority of the DMV, you are crazy. The vast majority of homeowners in this area look like me -- low rate, affordable mortgage, could move but don't have to, lots of job security, can stick it out for anywhere from 2 to 20 years.

You won't get a free fall in prices without either tons of people defaulting on mortgages or a massive sell off. Which won't happen unless the job market collapses. Which is next to impossible in this area because the market is built around an enormous amount of government employment, and buttressed by a ton of government contracting.

And you know what? If the feds start laying people off or the big government contracts, especially in defense, start drying up, it's an indication of a different kind of social/national collapse. The housing market would be the least of our worries in that situation. If you want to root for that, go ahead , I guess.

Anonymous wrote:

Anonymous wrote:The headline is more alarming than the content. Most of the people surveyed say a 10-20% drop in housing prices. I would say we’ve already seen about a 10% drop in prices in the DMV, uneven across areas but if you look at all the price cuts prices even in desirable areas seem to me to be about 10% lower than they were say six months ago.

This, and for people who bought before 2019, this will basically only wipe out the steep increase in prices over the last couple years but will not touch the equity they built before that. Meaning you can still sell a house for a profit after owning it for 5-7 years at a minimum. The housing market can never sustain steep price increases for long.

The only people who should be freaking out right now are people who bought within the last two years and want or have to sell in the immediate future -- they may take a bath. Also, people who have been waiting for prices to return to 2010-2011 levels are in for a rude awakening -- even with rate increases, that is unlikely to happen because of inventory. Unlike in 2008/2009, this housing "crash" is not fueled by overbuilding housing stock in hot markets (back then, it was places like Las Vegas and Florida, where developers built thousands of new houses knowing they could sell them to people for little to no money down). We also aren't seeing rippling economic effects leading to mass layoffs. A slowdown in hiring, yes, and some targeted layoffs in some industries, but not the domino effect of the last time.

I really tend to think this is a needed market adjustment that will benefit most homeowners in the long run by rewarding longterm home ownership.

A 10% drop doesn’t return prices to 2019 - I don’t think even a 20% drop does that. There has been a major price increase since 2019, and even if prices return to 2019 levels payments won’t because of the interest rate increase

Don’t forget the impact of the restrictions imposed on income tax deductions for mortgages over $750K. You will have to come up with $$$ to avoid losing out on those in a market where SFHs are $1million+. It is no joke that some areas are completely inaccessible to first time, non-generational wealth home buyers.

Anonymous wrote:

Anonymous wrote:I just don’t get how prices will fall when supply is so low.

The demand has absolutely slowed down. People are losing their jobs especially tech. Along with being a Fed hub, DC is also a tech hub. And those who haven't lost their jobs aren't making any large purchases right now especially at 7% rates.

Not the tech jobs here. Not contacting, not defense contractors. Sorry! People are still hiring. This is not a recession that people think it is, it's reactionary and situational.

Anonymous wrote:

Anonymous wrote:Prices aren’t going to free fall in any of the W clusters.

This is what my realtor said in 2007 when it was peak. It did fall down from 1.2 million to 700K in 2013

The reason then was completely different. Completely. This is nothing like that.

Home prices drop every decade. It is happening now. Our home has gone down in a desirable neighborhood. How far down it will go, who knows. I doubt it will be as bad as 2010 ish. Anyone refusing to believe prices are coming down has their head in the sand.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:The headline is more alarming than the content. Most of the people surveyed say a 10-20% drop in housing prices. I would say we’ve already seen about a 10% drop in prices in the DMV, uneven across areas but if you look at all the price cuts prices even in desirable areas seem to me to be about 10% lower than they were say six months ago.

This, and for people who bought before 2019, this will basically only wipe out the steep increase in prices over the last couple years but will not touch the equity they built before that. Meaning you can still sell a house for a profit after owning it for 5-7 years at a minimum. The housing market can never sustain steep price increases for long.

The only people who should be freaking out right now are people who bought within the last two years and want or have to sell in the immediate future -- they may take a bath. Also, people who have been waiting for prices to return to 2010-2011 levels are in for a rude awakening -- even with rate increases, that is unlikely to happen because of inventory. Unlike in 2008/2009, this housing "crash" is not fueled by overbuilding housing stock in hot markets (back then, it was places like Las Vegas and Florida, where developers built thousands of new houses knowing they could sell them to people for little to no money down). We also aren't seeing rippling economic effects leading to mass layoffs. A slowdown in hiring, yes, and some targeted layoffs in some industries, but not the domino effect of the last time.

Yeah, like the poster on here who constantly talks about “reverting to the mean”. Gonna be waiting for that “revert to mean” forever, buddy. It’s not going to go down that low in this area. Unless they’re posting from Austin, TX or Boise, ID. Too many folks not wanting to sell and give up their 2.5-3.5% interest rate.

Blah Blah Blah...

Your friendly (non-conforming) realer here. Miss me guys? Sorry, was on the islands with the family.

It IS going to be a bloodbath. EVERYWHERE. Not just DC, NY, SF, LA or...name your favorite locale. It's gonna be everywhere. Why?

The current economy (including housing) is BUILT on low interest rates. It's a house of cards. If interest rates start going up (Holy shit! They did!) the entire house of cards comes down. EVERY single person here who says "nah...not in my neighborhood or...not in the DMV...or whatever" is in denial. However, there is no way to convince a person who is in denial that they are wrong.

Read between the lines, be smart, be prudent, and do NOT listen to the BS posted here (or in some of the similar online boards). 40 year trend lines don't break because Powell says so. They break because there's a seismic shift underway.

Decide accordingly.

Anonymous wrote:Still have bidding wars in my Falls Church-Fairfax neighborhood. House was listed at $850k and just closed last week for $908k. Peak price for a house without an addition.

Inventory trumps interest rates.

As long as nobody ever moves … the house of cards has a bit more time.

Still have bidding wars in my Falls Church-Fairfax neighborhood. House was listed at $850k and just closed last week for $908k. Peak price for a house without an addition.

Inventory trumps interest rates.

Anonymous wrote:

Anonymous wrote:The headline is more alarming than the content. Most of the people surveyed say a 10-20% drop in housing prices. I would say we’ve already seen about a 10% drop in prices in the DMV, uneven across areas but if you look at all the price cuts prices even in desirable areas seem to me to be about 10% lower than they were say six months ago.

This, and for people who bought before 2019, this will basically only wipe out the steep increase in prices over the last couple years but will not touch the equity they built before that. Meaning you can still sell a house for a profit after owning it for 5-7 years at a minimum. The housing market can never sustain steep price increases for long.

The only people who should be freaking out right now are people who bought within the last two years and want or have to sell in the immediate future -- they may take a bath. Also, people who have been waiting for prices to return to 2010-2011 levels are in for a rude awakening -- even with rate increases, that is unlikely to happen because of inventory. Unlike in 2008/2009, this housing "crash" is not fueled by overbuilding housing stock in hot markets (back then, it was places like Las Vegas and Florida, where developers built thousands of new houses knowing they could sell them to people for little to no money down). We also aren't seeing rippling economic effects leading to mass layoffs. A slowdown in hiring, yes, and some targeted layoffs in some industries, but not the domino effect of the last time.

I really tend to think this is a needed market adjustment that will benefit most homeowners in the long run by rewarding longterm home ownership.

I’d be thrilled with 2019 prices. Never did I ever think or say I expect prices to go back to 2010. I’m not even convinced prices will go back to 2019 but one can hope.

Anonymous wrote:

Anonymous wrote:The headline is more alarming than the content. Most of the people surveyed say a 10-20% drop in housing prices. I would say we’ve already seen about a 10% drop in prices in the DMV, uneven across areas but if you look at all the price cuts prices even in desirable areas seem to me to be about 10% lower than they were say six months ago.

This, and for people who bought before 2019, this will basically only wipe out the steep increase in prices over the last couple years but will not touch the equity they built before that. Meaning you can still sell a house for a profit after owning it for 5-7 years at a minimum. The housing market can never sustain steep price increases for long.

The only people who should be freaking out right now are people who bought within the last two years and want or have to sell in the immediate future -- they may take a bath. Also, people who have been waiting for prices to return to 2010-2011 levels are in for a rude awakening -- even with rate increases, that is unlikely to happen because of inventory. Unlike in 2008/2009, this housing "crash" is not fueled by overbuilding housing stock in hot markets (back then, it was places like Las Vegas and Florida, where developers built thousands of new houses knowing they could sell them to people for little to no money down). We also aren't seeing rippling economic effects leading to mass layoffs. A slowdown in hiring, yes, and some targeted layoffs in some industries, but not the domino effect of the last time.

Yeah, like the poster on here who constantly talks about “reverting to the mean”. Gonna be waiting for that “revert to mean” forever, buddy. It’s not going to go down that low in this area. Unless they’re posting from Austin, TX or Boise, ID. Too many folks not wanting to sell and give up their 2.5-3.5% interest rate.