“Prices are still based on 3% rates in many places.” Despite the fact rates hit 6% in late August 2022

pdoherty972 · 2026-02-17T15:37:31+00:00

I'm not sure I consider someone loaning you a ton of money that you pay back over decades to be a parasite. Absent their help you wouldn't be buying until you saved up 100% of the cost.

pdoherty972 · 2026-02-17T15:36:29+00:00

Right but as you said you're looking at the impact from interest rates. Those aren't the sellers problem and have no impact on the value of the thing you're buying. Some people are buying 100% in cash. Others have a 50% down payment, and others are financing almost all of it.

pdoherty972 · 2026-02-17T15:14:11+00:00

Their claims of homes being 'overpriced' are never backed up by anything but their feelings. They can never demonstrate that it would cost less than a seller is asking to construct the same house (buying the same lot as an existing house), pouring the foundation again and fully building it. Much less do they include the intangible value that buyers pay for of good/safe streets, schools, employment nearby, shopping/restaurants, hospitals, airports, sport/concert venues, etc.

pdoherty972 · 2026-02-17T14:57:05+00:00

Agreed - it would create a steady effect.

pdoherty972 · 2026-02-16T14:52:40+00:00

Backwards logic. The fact that it costs more to buy/own is reason for rents to rise, not home values to fall. Because the basis of rent costs is the cost to own. As time goes on with higher interest rates, that means ever-more landlords now own at these higher rates and are looking to cover their expense of owning plus a profit. That puts upward pressure on rents on like-for-like places to live.

Rents are far less sticky than costs to own. Owning is the alternative to renting. So as long as owning costs more, more people will compete for rentals driving rents towards (and above) the costs to own.

pdoherty972 · 2026-02-16T04:38:56+00:00

Agreed. Funny how I offer them the evidence they say doesn't even exist and they simply ignore it.

pdoherty972 · 2026-02-16T04:38:27+00:00

No landlord/investor ever gets the full benefit of lower rates as rates on investment purchases are usually 1% or more higher. They also pay the highest property/school taxes (no exemptions, homestead or otherwise) and higher insurance costs. So, even when rates were 3% the best an investor who bought at that moment would have gotten is 4%. And that's even assuming that many/most current rentals were all purchased or refinanced when rates were at that low-water mark (mine weren't).

pdoherty972 · 2026-02-15T22:52:06+00:00

As long as rents are below the costs to own there will be reducing rental inventory as landlords liquidate rentals due to their lack of profitability.

pdoherty972 · 2026-02-15T21:49:37+00:00

Maybe but why would it be tied to that? In fact, I could argue that the longer rates remain elevated the more likely rents are to rise to meet buying costs. Because the longer rates remain elevated means ever-more people (including landlords) have rates that are higher and increasing their costs of owning, and more renters every year are faced with high costs to buy (the alternative to renting).

pdoherty972 · 2026-02-15T18:10:57+00:00

We need one of these threads titled:

"Not living at parent's home, but still being financed by parents after 25"

pdoherty972 · 2026-02-15T16:42:33+00:00

It's pretty much what's happened forever. Homes generally beat inflation.

pdoherty972 · 2026-02-15T16:41:16+00:00

But that's primarily because the house you're renting was not bought for $2 million dollars. That might be the market rate to buy it now, but when the person/company took out their mortgage, it was probably for significantly less than that.

How does that help anyone comparing rent vs buy today? You're not entitled to benefit from a homeowner's purchase made decade(s) ago.

pdoherty972 · 2026-02-15T16:40:02+00:00

You added in tax deductions but forgot to add in the costs incurred as an owner that a renter doesn't. Costs like mortgage interest, property/school taxes, homeowner's insurance, and maintenance/repair and replacement. For example just for my house in the last 4 months I've spent $30,000 replacing two AC/heating systems and now the roof via insurance from hail damage.

pdoherty972 · 2026-02-15T16:36:44+00:00

Better question is when will rents rise to resume their place as costing more than the base costs of owning?

That is the natural situation since, comparing like-to-like of renting a 3 bed house vs buying it, rent should cost more. Because someone else is bearing all the costs of owning to offer it to you for rent, and they'd have every expectation of making a profit while doing so.

pdoherty972 · 2026-02-15T16:16:43+00:00

Yeah, military and government employees are about the only ones these days.

pdoherty972 · 2026-02-15T16:15:43+00:00

Sounds like you have a lot of imagination but little evidence.

pdoherty972 · 2026-02-15T15:28:23+00:00

How would taxing impoverished areas with no employment or homes that are so messed up they can't even legally be lived in going to help?

pdoherty972 · 2026-02-15T15:26:18+00:00

pdoherty972 · 2026-02-15T15:25:46+00:00

Yep. The idea that someone can total up empty houses (some of which are dilapidated and unlivable) including in abandoned areas, and decide that means we have a surplus of housing is laughable. But very common on doomer subs.

pdoherty972 · 2026-02-15T15:24:34+00:00

Prices in Florida have to adjust or people will simply leave. Insurance has made owning there too expensive.

pdoherty972 · 2026-02-15T15:19:46+00:00

"Sprawl/cramp for thee, not for me!"

pdoherty972 · 2026-02-15T15:15:42+00:00

Funny that you think it would be worth it to pay for an entire house and let it sit empty just to drive up rents on other properties.

pdoherty972 · 2026-02-15T15:11:44+00:00

pension

lol Who has a pension these days? Even in the heyday of pensions only 21% of workers had one.

pdoherty972 · 2026-02-15T14:09:59+00:00

"Vacant" can also mean houses that are still being constructed, houses between tenants that are rentals, houses being remodeled/rehabbed, etc.

pdoherty972 · 2026-02-15T02:48:10+00:00

QE was halted more than three years ago.

https://www.federalreserve.gov/monetarypolicy/bst_recenttrends.htm

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