how housing market will change - my predictions

[Fish]

On 6/26/2023 at 8:49 AM, Telugodura456 said:

current scenario:

with high interest rate appetite is gone for houses above 800k among buyers.

builders got taste of selling houses in 1 million range and dont want the burden of building sub 500k house.

So builder waiting for interest rate decline so they continue building 800k plus houses. buyers waiting for price decline or interest rate decline.

Fed not interested in rate decline if builders are not lowering prices.

so what next? how to break logjam?

Builders stop being lazy and plan and build 500-600k or sub 500k houses. This is competitive market response and ideal.

builders stop bothering and will wait for interest rate reduction or demand grow up. This is cartel market response.

Buyers adjust to above - will either buy or simply rent.

 

You talked about all positives scenarios like if market is going to be this way 

but there can be unemployment because business can’t get loans at this high interest rates. Because of unemployment we might see foreclosures. Dedollarization can also cause some ripple effect.

[Pavanonline]

 

[Fish]

On 6/26/2023 at 9:44 AM, shaktimaan said:

most of the homes built during 2020-2023 are sub par quality and are overvalued

unfortunately most desi folk won't realize this and fall for the cookie cutter suburbia

 

Very true, I suspect builders might not have used quality material because of inflation 

[Fish]

2 minutes ago, Pavanonline said:

 

Seasonal rise, which is expected 

[Fish]

23 hours ago, shaktimaan said:

inka pulte or lennar aithe na bootho na bhavishyath… framing kuda sakkaga undadu

Mari ye builders reliable?

[Fish]

11 hours ago, sureshkonda said:

severe recession vasthe first impact ayyedi dallas. not many local it jobs like bay area. imagine 100 people competing for 1 job

Not even 1:100, it will be much worse if recession comes 

[shaktimaan]

38 minutes ago, AreyOSamba said:

True. But, the most impacted are homes built in 2022. As interests rates started to raise and builders rushed to deliver putting the quality at risk 

It started with Covid labor shortage and using low quality materials. They realized they can get away with this and still doing it 

[shaktimaan]

7 minutes ago, Fish said:

Mari ye builders reliable?

national builders usually only care about volume. Small local builders reputation is at stake and they’re reliable

[Telugodura456]

3 hours ago, Fish said:

You talked about all positives scenarios like if market is going to be this way 

but there can be unemployment because business can’t get loans at this high interest rates. Because of unemployment we might see foreclosures. Dedollarization can also cause some ripple effect.

unemployment unlikely at this point - because high interest rate is compensated with high inflation for business. It may come if high interest continues for 2-3 years with low inflation.

Corporate america has very low debt to equity ratio showing low debt burden.

[Telugodura456]

3 hours ago, Fish said:

Mari ye builders reliable?

No one. But you are lucky if local govt officials inspections are strict.

[Paamu]

15 hours ago, sureshkonda said:

severe recession vasthe first impact ayyedi dallas. not many local it jobs like bay area. imagine 100 people competing for 1 job

With savings,  most of them will be able to survive for several months because of multi udyogalu. 

[Fish]

3 minutes ago, Paamu said:

With savings,  most of them will be able to survive for several months because of multi udyogalu. 

Not everyone had savings kada 

[Manishican]

Only layoffs will bring housing down. But so far job market very strong.