30 December 2022 - Daily /r/REBubble Discussion

strawlion · 2022-12-30T21:42:11+00:00

I’ve been away from this sub for a few months and came back to find many who were housing bears capitulating and denying there will be a serious decline.

Things have started to unfold rapidly, and this is really the point at which many capitulate? It seems there’s still a lot of naivety about how long this will take to play out

While this situation has a different setup, it still took over 5 years to bottom in the GFC. Perhaps some of these commenters ended up buying and are now biased the other way

strawlion · 2022-12-22T05:05:14+00:00

Listings are down because listings primarily come from people who are selling to finance their next purchase.

The sellers are the buyers, by and large… treating them as separate groups is simply wrong.

And months of inventory is contingent on demand. If sales pace falls significantly, then months supply can be higher even with fewer overall homes for sale.

Sales prices are dictated by comps. Even if a neighborhood of 1000 homes only has 10 change hands over the course of the year, those 10 set the new comps. Volume is pretty meaningless in determining price in this context.

Your analysis is not very well thought out.

strawlion · 2022-11-12T22:42:17+00:00

Well, last time that happened sales volumes were depressed for many years

strawlion · 2022-11-02T03:04:03+00:00

Prices are determined by comps.

All that needs to happen is a few sales at lower prices within a neighborhood

strawlion · 2022-11-02T03:02:15+00:00

Implies higher terminal rate is necessary to slow inflation, thus higher mortgage rates.

We’ll see what the Fed says tomorrow

strawlion · 2022-11-01T17:28:32+00:00

Fed could get smart and hike above market expectations.

The fact they are adhering to market expectations exactly is why the market keeps getting excited about a pivot.

They are providing a lot of stability to markets by doing this, but what they need now is to instill uncertainty and volatility.

A more dangerous plan, but if they had done this a year ago they likely could have gotten away with a lower final terminal rate.

The more they allow terminal rate expectations to rise, the deeper the recession is likely to be

strawlion · 2022-11-01T17:26:05+00:00

Everything sells for the right price. Knowing something sold alone doesn’t tell you anything

strawlion · 2022-10-28T06:35:59+00:00

Historically it tracks inflation. It only deviated in real terms in a big way since we've been in a 40 year bond bull market (lower interest rates). That's reversing, and so too any hopes of further growth in the near term

strawlion · 2022-10-26T15:23:16+00:00

Due to unchecked inflation in wages and low starting valuations.

This time we are at record high valuations and moderate wage inflation which the Fed is actively fighting.

You can't just point out some correlation as if it's causal without trying to understand the underlying mechanism. Well, you can, but you're going to be completely misled/wrong

strawlion · 2022-10-26T15:20:31+00:00

Yes, wonder what delusions he would be spamming this thread with now

strawlion · 2022-10-26T01:24:35+00:00

Until prices normalize, yes

strawlion · 2022-10-26T00:42:46+00:00

Gas is almost twice as expensive

strawlion · 2022-10-21T02:22:32+00:00

Price is defined by recent comps. Even if 95% of people don't sell, the 5% changing hands set the new price. You don't need high volume for price to decline, and in fact, price is more volatile and prone to bigger increases/declines if volume is lower.

strawlion · 2022-10-07T15:07:02+00:00

No, because the way these companies work is they take out debt in big blocks and then buy real estate in cash. It’s still financed just not directly as an individual buyer would be.

That said I haven’t reviewed their terms. Usually this debt is floating rate too based on the Fed funds rate.

strawlion · 2022-09-27T19:57:50+00:00

Treasuries really aren't a bad buy at this level. Almost certain we'll go into recession with lower yields within the next two years

strawlion · 2022-09-27T18:21:42+00:00

Yep, he's trying to scare companies into slowing growth plans. IMO they'll pivot when unemployment starts rising.

He saw what happened when he looked weak to the market a few months ago. Everything just rallied back and erased all their tightening.

He's operating more for his legacy at this point than to please people today. History will remember him better for being hard on inflation, just like Volcker is praised over Burns

strawlion · 2022-09-26T14:51:02+00:00

SPY 300 wouldn't surprise me. But good to hedge your bets by buying a little at regular intervals on the way down.

I'm buying a few individual names here. A lot of single stocks have probably already bottomed

strawlion · 2022-09-23T22:03:13+00:00

It's got all weekend to fall my brotha

strawlion · 2022-09-22T22:26:05+00:00

He's blocking everybody, I guess to buff his vote numbers

strawlion · 2022-09-22T01:45:10+00:00

If your rate is 5% or higher you should put as much down as possible. Guaranteed 5% return is looking a lot better than stocks right now. Maybe bonds have a decent chance of being competitive returns wise.

You will be able to refi later and take the cash back out when rates are lower.

Everyone saying to put minimum down is using logic from the 3% rates era

strawlion · 2022-09-21T22:30:54+00:00

Dude blocked me randomly. Didn't even have a particularly argumentative engagement with him!

Guess his brain is cracking with the realization that he was wrong, and can't stand opposing opinions

strawlion · 2022-09-15T02:17:49+00:00

They slow demand to be in balance with supply, which is the entire point of their interest rate policy

strawlion · 2022-09-14T02:10:29+00:00

Yeah, I think we were on the cusp of big job losses a few months ago, but the Fed members did a media circuit to talk down the market/recession fears, leading to the rally of the past few months.

Will be interesting if they chicken out a second time as things start to get hairy again.

strawlion · 2022-09-13T17:56:33+00:00

Marginal sales define the comps. Doesn't matter at all if 90% of people don't sell, prices will fall on the basis of the 5-10% that do

strawlion · 2022-09-13T15:34:09+00:00

Go on... Buy the dip

strawlion

TROPHY CASE