Home Sales are About to Nosedive
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- Опубліковано 28 вер 2024
- Home sales are about to plummet in the United States and we’re already on track for fewer closed sales this year compared to last year. This is remarkable given that 2023 was the lowest amount of real estate transactions since 1995.
The National Association of Realtors (NAR) reported on 5/30/24 that pending home sales fell from last month and from a year ago this April. Based on my own analysis of their data, their Pending Home Sale Index (PHSI) fell the lowest levels on record (excluding April 2020). NAR’s data goes back to 2001 so pendings fell to at least a 23-year low! We’re also seeing fewer people submit mortgage loan applications in the United States (falling to a one month low this week). This is all pointing that closed home sales will fall in the months to come.
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To give you a quick mortgage interest rates update, according to the Mortgage News Daily the average 30yr fixed rate mortgage is around 7.2% for the current mortgage rates (at the time of filming this video for borrowers with exceptional credit).
Comment below: what’s your housing market forecast? Do you think a housing crash will happen or are your housing market predictions that the real estate market and home prices will continue to surge?
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IMHO, this trend will continue . I’m seeing a lot of price reductions . Thanks, 🙏 Jason!
You're welcome! Have a great weekend.
Almost all houses sold in our subdivision this last month that had been sitting for a while. Selling around list price with 1 20k over and a few 5-15k under. Nashville, TN
We need to stop blaming the rates. Rates are not the issue; it’s the prices. Rates can be adjusted in a few years if they go down, but prices are forever. Once you pay a high price, there's nothing you can do. Smart and patient buyers are waiting for prices to come down.
Rates are definitely an issue…yes sales price is the life of the loan but buyers want more bang for the buck, but because of high interest rates, they are getting Pennies on the dollar…and adversely…people with low interest rates, don’t want to sell cause they are able to afford more house
The prices also influence the property tax and insurance you end up paying, not to mention of course being the basis the interest is acting on… definitely the root issue.
@Ultrajamz Pricing doesn't exactly impact insurance. The insurance carrier has estimators on rebuilding costs for the home
A lot of people waiting to jump. into the market that won't go down, If it won't. go down, it's going up, Rates will come down, Now is the time to buy.
Date the rate, marry the price.
My realtor neighbor said the same thing about sales. They slowed dramatically this Spring and looks worse for the Summer. She closed a couple very quickly in the Spring but is planning on seeing much lower activity with longer times to sell, and is spending accordingly.
I believe it, thank you.
Good let those home prices fall
Must be a weird time for realtors. Very few sales, but fantastic commissions when they do make a sale at these prices.
Crap! Who could have seen this coming!?
Listen I considered buying in 2007 and didn't. When I circled back to it in 2012 prices for houses had gone up. I didn't buy then either. Circled back around in 2017 and guess what prices for homes had gone up again. I didn't buy then either. So when I circled back around again in 2021 and realized what the prices had gone up to I bought because I realized then not once since 2007 have the prices gone down, or back down to "previously seen levels" and they never will. Stop waiting for prices to go back down. They never will. If you want to buy then buy. Make the sacrifices to own your piece of America.
NOT IN GEORGIA!
Prices here are going up and they're continuing to build new homes as fast as they possibly can...and believe it or not they're selling quickly. Savannah area is definitely a growing hot spot. Its very desirable place to live especially in the surrounding "country" areas 😮
Thanks Jason, as always I appreciate you
My pleasure!
Have an awesome weekend Matt!
Thank you sir
Can housing prices go up, with no sales. Hmmm......not sure.
Maybe if the stock market continues to go down......
You only need one sale.
@@liamc4113 Makes sense. Poor realtors.
Low amount of sales and increasing prices? Absolutely. We saw that last year and so far this year too.
here in Wilmington, NC the only price reductions.. are on homes that were overpriced to start with.
Jason , You’re my UA-cam star thanks to your amazing analysis and ability to communicate technical details in a simple form❤! Please choose another song to close your show because it hurts my ears❤🎉, Cheers
Thank you, Paul! Is the song too loud at the end? Sorry about that.
@@JasonWalter1 Your music is LOUD and the Bass sound makes me feel “Bullied”…A softer sound is ideal, cheers
I live in Southwest Fl..they definitely need to stop building..too much inventory
California nuts for home prices rn as a 25 year old with 170k still would be hard to pay the average mortgage payment
NAR is shady AF. Can't forget they are trying to sell houses. I wish everyone could be as fact-forward as Jason.
In the west valley in AZ, market is still white hot . Also there is 30k permits of single family dwellings pending also . This goes to show that all real estate is local
Thanks for your analysis! #GetNerdy
Price correction incoming
All time NOMINAL high
You need to adjust for inflation
The price analysis is not serious until you at least acknowledge the inflation aspect
How is a .09% decrease a "nosedive" ? Another nose dive to other click bait videos
About to nosedive due to record low pending home sales as mentioned in the video.
1😊
Let the sales continue to implode and inventory to increase. Keep rates higher for longer and soon housing will become affordable again
Our house price has continued to rise to obscene levels. It's not that the house is worth more, it's that our currency is worth LESS. We're having to pay taxes on the inflated prices.
How does housing become "more affordable" with 7%+ rates?
@@jaydeeare285 lower prices
@@jaydeeare285 the prices need to come down so that monthly payments make sense again. That's how homes become affordable again.
@@yakemon "Makes sense" to whom ?
I really wish many of these agents would put more pressure on sellers to lower prices instead of just cheerleading for lower interest rates. It would put the market in but much better shape!
I'm seeing a lot of homes pending for a very long time and "back on market" listings. Are people not getting sufficiently pre-qualified before they go into contract?
Same. It’s either “under contract” “pending” for weeks month+
Definitely a lot of homes under control and then back on the market here in Oregon. Prices are high, just not Cali high.
4k/ month is still a lot for most people though
My concern is tgat investors and corporations like blackrock are buying up properties and turning them into rentals. If this continues, there may never be a point in which housing will be affordable. I hope I'm wrong, I don't want this to be the case at all. I'm just expressing a fear
Interest rate lower will attract more people to buy properties, but it doesn't really matter to me. I bought my first home at 7% interest rate, but the house cost 60,000. I sold it at 130K when interest rate at 3%. Today, that old house is worth 450,000 as property tax value. So interest can be lower to 1%, I would not buy it back at that price.
Blah blah blah…
Is it possible that the market has exhausted the supply of the dumb and/or desperate?
The combination of fomo and people with enough money to buy at any price point has a limit
@@nitroneonicman it seems so.
All that to say, the prices arent crashing
The real estate crash on YT has been ... "just around the corner" since 2017. Thats 7 to 8yrs of just around the corner crash is coming. I know people who SOLD in 2017vdue the impending crash just arounf lmd the corner. 😂
Putting my home on the market in 3 days in Portland, Oregon metro. About 1/3 of homes go pending in a week. Still a hot market. We'll see.
keep us posted!
if it is priced right, it will go. Price reductions in my market in North Idaho- Coeur d Alene. RE agent here.
I like to check in with the crash hopium crowd here every once in a while. Still the same comments for over almost 3 years now..😂😂😂
Thank you for all the work that you do! These real estate companies are pulling every trick out of the book to try to prop up these crazy prices a little longer. The only reason the prices were this high is because the rates were so abnormally low. Now the rates are higher, the prices will not be supported. As soon as unemployment goes up and/or people run out of money- the inventory will rise and demand will decrease further
What real estate companies and what tricks??? Can't wait to hear this one.
@@ab-qn7kv My friends are keep buying houses even though they cannot afford them. All of my friends are buying 5 or 6 houses with very low down payments. The real estate agent is telling us. Government will pay for the house if we fails to save housing market. We should buy as many houses as we can and government will pay full. A great way to make money.
@@ab-qn7kv not worth my time to explain to a real estate agent what is happening Talk to me in a year
Thank you for watching and commenting! I'm very curious about what the labor market will look like this Fall and Winter.
@@ab-qn7kv Just one example I have witnessed for new-builds is big incentives (other than price reductions). They gave a family member a way-below market interest rate (4.75% on a 7-year ARM) rather than just cutting the price accordingly. It cost the builder money to offer that incentive, and they could have just cut the price the equivalent amount, but instead offered it in a way that kept the higher purchase price.
I believe the builder was Lennar, in that case.
Another friend bought a new home in Maryland and they received some big incentives as well. I didn't catch all the details, but essentially the builder was giving them a big chunk of their down payment back after closing, as some kind of rebate. But not just bringing down the sales price accordingly. I don't remember the builder in that case, but it was just a little south of DC.
The net effect, in both cases, kept the official "sales price" higher than it essentially was.
dominos starting to fall
There are other videos online showing with evidence that institutional investors have begun to sell their properties with losses of more than 20% in different states to avoid paying high taxes. Something big has definitely started to happen and they know it and they are starting to despair.
Really ? Which "institutional investors" are doing this , exactly? And how many properties are they selling ?
Whose video? We want to know!!!!
@@CurtisLoew-q7q I'm going to take a wild guess and say it's by a guy bumbling around in a neighborhood and saw one property for sale. 🙄
I just posted a video (click icon to left) about how first key homes bought 400 Lennar new builds in San Antonio last few years, now selling in most of those neighborhoods up to 20% off
@@CurtisLoew-q7q This is starting mainly in cities in Texas and Florida where more new homes have been built than there are buyers.
The most affected cities and states are those that have new homes with oversupply inventory.
By July we could have 40% more inventory.
REwatchman has published a very interesting video today and I recommend that you watch it as an example of what is happening in San Antonio, Texas.
All the bulls in the comments swinging at the air rn.
Profile pic checks out XD
Drop those prices.
There may be a point to make that lower interest rates in 2020/21/22 pulled a lot of demand forward leading to less buyers now and in the next 2-3 years. So, the "droves" of people waiting to buy a home may not pan out as many people expect
Peak sale season is over. Sales will dip until Feb of next year, at least until rates get cut, which I don’t think will happen this year.
Yep. Spot on. Looks like a deflation in the USA is starting to take hold big time in the USA. Good news is new builds seem to be continuing but people do need to take seriously where they put their savings as Bank Failures look set to erupt again.
I'm really curious... will we get a rate cut this year or not. Remember when everyone was talking about 4 cuts? 0% chance that will happen.
@@JasonWalter1 there are stock manias the Fed destroys such as Y2K and 2008 and 2022 and then there is this "4th one" namely an Ai mania. I can't speak to real estate as I'm not an expert but as for what destroying trillions of US Dollars in total wealth annihilation looks like this is still ongoing both as a result of inflation for what all of us must pay and deflation in the form of a Bank Run where credit has been extended in US Dollars to something that has no economic chance at all of being recovered let alone the money being repaid. I haven't seen any mass foreclosure auctions which would be a "hard data point" if that is what you're asking about.
@@JasonWalter1 agreed . Fed can tease us, but they will not do it. They cannot afford it.
I'm loving watching the number of good houses pop up and stay on the market and massive jump in price decreases starting.
Hope we don't bail out these banks or investors when the cards fall.
If you live in a desirable area your home value will most likely always go up. If you can afford buy now.
If you live in a not so desirable area just put in low ball offers.
Rates will top out at the end of June/July and maybe get back down to high 4’s next year.
I have heard this for a few years now and I am still waiting for the bubble to pop!
At this rate, I would have retired before it happens.
Buy when you can afford it. Don't wait unless you must. Just don't over pay.
And the music has stopped. Who won’t get a chair?
I hope that all buyers sit out and let them greedy flippers and investors eat the costs! I've noticed flippers bought a home for $400k and turns around selling that same house $600k after a month and half. Nothing wrong with making profits but $100k plus in a month?! Give me a break!
you can’t blame them if the buyers are paying for it. at the end of the day, we all want to make more money.
Great job 👏 thank you
No crash
Great video! Hope to see analysis specific to Phoenix/Scottsdale Arizona market which has been blooming since covid period
Thanks for the info you provide - data driven and honest. I agree things aren’t looking good and I am seeing tons of signs of the market softening in the 3-4 markets we’ve been watching for the past 3-4 years. We just sold our home in Tampa FL and so thankful we did! I feel we got out at the nick of time. Things are shifting fast! Just saw a house in our neighborhood (one of the most desirable areas in Tampa) being put up for auction 😮 I was shocked!
Congrats on selling your home!
@@JasonWalter1 TY! We busted our butts getting our home in perfect,tip top move in ready shape which is hard to do for a historic bungalow home (101 years old). That’s what helped it sell. And it was priced appropriately. Many homes in our neighborhood are not. They are sitting! We got full price,cash offer. Sellers need to see their home for what is really is.
TGIF Jason & Happy Friday 👍
Great analysis as usual. Sharing that I saw a home in Austin on Zillow that decreased from its peak home value based on its 2022 Tax Assesed value of ~$910k to its current listing price of ~$640k. Yes, a $270k decrease. That is staggering and curious to see if you have any findings on these price softening occurrences in Austin or any other markets.
I moved to Sacramento 2 years ago and still haven’t been able to find a house! These interest rates / prices make any single family home down right unaffordable, and that’s with a 100k salary! Till then it’s apartment living paying 2200 a month rent not including utilities.
Sorry to hear you’re having a hard time! Despite these 7% rates, our market remains competitive overall.
I’m sorry but why don’t realtors try to talk their clients into a more realistic price? I’m assuming the homeowner is in the drivers seat pushing for a high price but with everything sitting in my market I would just want to sell. Realtors would have more volume. I suppose it’s hard to convince a homeowner that it’s over, and it’s time to get real
Most people would make the connection that high house prices are too high, no one wants to pay more for something than it is worth. ?would you buy steak if it was $50 a pound? at $50 per pound, sales of steaks would go down. Totally agree with other comments; mortgage interest rates are not as important as the price of the house. Agree that realtors should convince sellers to reduce prices to realistic prices instead of rooting for lower interest rates-
In my area (colorado) Redfin says cities like aurora and centennial and cities in douglas county, are experiencing a spike in inventory and low in sales.
Yet median days on market nosedive to 2-4 days on market? Shouldn't it be spiking? What is going on with redfin?
It's because sellers refuse to lower price. The nice houses sell fast, but most need remodelling and they're selling for 20+ days at 2021 prices.
Colorado is weird. Prices still rising inventory dropping west of I-25. East of I-25 prices dropping and inventory rising.
@@billricheter5678west is more sought after since you are closer to the mountains and still close to downtown. In between the mountains and downtown.
Negative, mostly older homes. East has more new builds.
@@billricheter5678premium on mountain proximity I guess. Service is probably better at restaurants east of 25, where service industry workers haven’t been priced out of entire regions
The federal bank of St. Louis website has stopped publishing housing info for Weld county, which seems to coincide with inventory exploding.
All the attempts at hiding or dressing up the reality of the housing market is going to have a negative impact on the reputation of people in the housing industry for years.
🤙🏽🍍🌴
Aloha!
And I will make the point the FED and our Governments do not want deflation. They are getting better and better at keep prices propped up and kicking the can.....
Govt needs inflation.
Do you know what the month's inventory figure is nationally?
I am so glad I sold my house last year
Raise interest rates.
Target, Home Depot, Best Buy, McD, Auto Mfg, etc reporting slowing down economy. JPM, Blackstone warn of slowdown. Housing is just catching up now. End of the year it will be quite bad, at least it's headed that way.
also those 5 or 7 year ARM loans are going to start coming due and I'll bet there'll be quite a few going for sale
Is author said about shootdown 10000 times. Once is could happen. Just wanna remind his video about dint buy houses in 2022))
I've made over 1k videos and in 2 of those, I said I wouldn't recommend placing a deposit down on a dirt lot for a new home construction development. If I recall, that was in early 2022 which ended up being very good advice since for the most part you can't lock in your 30yr fixed rate until the home is completed. Therefore, place a deposit down in January 2022 when rates were at 3.4% and by October they surged to 7%. That's why the cancellation rate spiked in late 2022 and a lot of people lost their deposits.
Love the strategically placed "$5.00 Charge for Whining" placard.
I like but most people here whine all the time.
I’m already taxed enough, I won’t be taxed for whining too
2.9’million foreclosures just in 2009 alone , for anyone looking for historic context on inventory of around 800k today .
2.9 million foreclosure filings but a lot of those were modified so never hit the market as inventory
@@johnnycastaneda2371 true, but they were are future inventory to hit the market. the problem now comparing the 800k inventory we are one fourth , how ever the actual demand for homes is 4 times more.
Im surprised that you're surprised by this.
For the foreseeable future nobody is selling their house unless they 100% have no other choice. Who wants to downsize into a higher payment?
Divorce and death will never stop. So homes will always be up for sale .
Not only death and divorce but more debt increases the chances of selling it higher. If someone is drowning in debt, which it seems a lot of people are or that it’s getting worse, people will sell to get their equity and pay off their debt. Then just rent for a little bit.
People will soon have no choice but to sell. Hard to keep up with payments when everything else is skyrocketing and job losses looming
@Donkiko-bz1lv Those things always happen regardless and they OP basically acknowledged it in his comment already. 🙄
@@andreatrulock5245 Maybe. I think more will take a home equity loan when that is available.
House prices are down about 20% if you exchange it with true traditional money.
But most people use currency to buy houses which has lost 99% of its value and creates the illusion that prices are higher.
Absurd. 🙄
Are "about" to nosedive?.....cmon Jason. Let's start reporting on actual declines.
Did you watch the video?
@@JasonWalter1 No. Your click bait dissuaded me
The fed is raising rates baby
This is just for previous months. Just in the past 2 weeks i have seen way more homes go pending . So chances are that in may, june, july the sales will go up again due to seasonality. So on AVERAGE it will be a mild downward trend, but for sure not a Nosedive.
It is all being orchestrated. Be wise with your spending! Use wisdom. Bought a house a few months back after renting for 12 years. It was scary but I am glad I did. If it is in your budget regardless of the interest rate it is still worth it as you are not throwing your money away. Once the rates drop there are going to be multiple offers on properties which will inevitably increase the listing price. Double edged sword