Corporations are only a small part of the problem. Fix zoning laws, subsidize new housing development to increase supply, and house values will come back down to earth.
Yeah I bought my first place last year, kept getting told to wait because it would go down. There's no way its ever that low ever again, and if it ever dips below 4% again, the FOMO will be huge and the market will be so insane that you won't be able to find a place.
Home's don't FEEL unaffordable... they ARE unaffordable. This is what happens when a feckless Central Bank prints and buys trillions of dollars of government debt to artificially drive down interest rates. The entire RE market got repriced when you could get a 30 year mortgage for 2.85%. Of course mortgage rates are going up- investors aren't stupid and they are legitimately worried about future inflation and don't want to get paid back in confetti. Longer dated debt, 10+ years could care less about the FED's stupid Federal Funds Rate.. that is 24 hour debt with zero duration risk. Longterm and short-term debt are entirely different markets. Mortgage rates are going higher.
I think that the growing manipulation by investors that are buying up a large amount of the housing has also increased housing prices and the government isn't doing anything about it and these reports don't adequately shed light on how they corrupt the system.
That's right. The 'powers' control our lives. They decided to create 'covid' as a 'smokescreen' to jack up the prices of everything. They blame it on 'inflation' that THEY created. About every decade they pull off the same 'BS'......
This is why Luigi is being praised not scolded for doing something about the current system. Someone's going to loose their home (owned or not) and do something about something..😅
🤓 akkuuuallly homes are an InVeSTmeNT /s Get hedge funds and people with multiple homes tf away from the SFH market. It should never be considered an investment
It's called greed. Rich people would rather destroy their own country rather than asking for a realistic amount, then they go to war against homeless people. It makes no sense.
No this is over simplistic garbage. It's called supply and demand as explained in the video. It's a lot more nuanced then just greed, it's a complicated market that gets influenced by the fed. Did you even watch the video?
Where the greed comes in is the zoning laws. The houses are worth whatever people will pay, but they block new housing development with zoning laws to keep house values high.
based on your comment, you have zero understanding of economics. Mortgage rates are high(er) because they are competing for savers' dollars with consumers, businesses, state and local governments, and.... the Federal government. In case I'm not being clear, the Federal government is crowding out all the other borrowers from the credit marketplace. If the Treasury borrowed less, more dollars would be available to fund mortgages (at lower interest rates).
@@SnowBalling You've seen the first chart presented on this video; What is the point of making more houses if people can't afford to buy them??? From 2021 to 2024 you're literally paying four times more in interest than you would have paid 3 years prior. THIS IS GREED plan and simple!~
Between corporations buying houses and home builders controling the supply to keep the prices high. The average buyer gets priced out and risks more on a higher interest rate in order to buy a house.
This is why Luigi is being praised not scolded for doing something about the current system. Someone's going to loose their home (owned or not) and do something about something..😅
thats the thing. I see in comments of similar posts/videos of people blaming others for "not living within their means and work harder" but the truth is a lot of those commenters absolutely could not buy their house in today's economy (even just a few years ago!). It has gotten exponentially harder/worse **not saying you're one of those people btw.
This is a supply side issue that is being exacerbated by both individual and corporate greed. You can’t have affordable housing when you have a bunch of corporations buying up large swaths of affordable homes and outbidding single buyers. That just makes a bad issue worse because we already have an issue with individual investors owning 10, 20+ properties and becoming rent seekers. Pair that with an environment where existing home owners do everything they can to prevent new construction of homes to protect their home values and you have an environment with high rates and incredibly limited supply, ridiculous housing prices, and an environment with incredibly low mobility
The damage has been done, nobody is going to lower the asking price on their home. Half a million for what can be considered a started home is ridiculous.
Building homes will not fix the problem. Not at the rate business are buying up homes away from the average person. People are buying homes not to live anymore. They are buying them for investment and then selling it. It is no longer I buy a home and this is my home for YEARS.
what do you think people are doing? they can't find a house so they pay to build one. that also costs money, back in the day men used to build their owns homes on free land.
@@AChillin01Ryup. Corporations are buying up houses more than ever now. There’s even stocks average people can invest in for these companies making it worse. It’s almost like there needs to be regulations in place to prevent stuff like this happening by not allowing corporations to come into real estate for better good of America. But as soon as you say that you got brainless people screaming commi or socialist who don’t even know what it truly means but just love the word.
My parents bought a house in 2012 when their mortgage was going to be $2,200 compared to them paying $1200 a month for rent. Over ten years on the mortgage is half that and rent is now more expensive than when they bought their house. It’s worth it to buy a home so long as you can reasonably afford it
They're virtually the same price they were in 2021. On a 30 year mortgage at current rates you will spend more on interest than on house, and that appears to make houses more expensive
Rates should be 10% with no more than a 15 year term... but na, the last thing the system wants is a bunch of debt free 40 year olds with a paid off house and a MBS market where you could make 7% risk free. No they want us all to be debt slaves and forced to invest in the stock market to see any kind of yield.
@@jonb740 it starting to come down in big cities where people overpaid. This is true to places where you have military presence when they are forced to moved. Force movers will face reality soon.
I think it’s going to be a long time before I can even find myself in a situation to buy a home. When they lowered interest rates, they exacerbated the problem we’ve had in this country, which is continually not building housing to keep up with demand since 2008. Homes overpriced. They’re probably not gonna go down. The average wage is not kept up with that and interest rates are high even if you lower interest rates you still have the fundamental problem of people don’t want to move out of there current interest rate and wages have not been able to keep up with the insane price increase housing has seen.
You can thank Bill Clinton and his administration for a lot of this.......and the banks...and the weasels ......quite a few businessmen , politicians, and 'certain' groups played a big role in this crises that's only getting worse.......Goes back to "Be careful what you wish for".......especially when you vote. Hell, anymore, I personally don't think the voting process matters. The powers that behave control of that too. They're going to place I office who they want ( oh they 'let' the people think it was their votes that counted); but it's all manipulated. They win, you lose....no matter ......
Long term risk combined with high demand. Higher long term inflation risk demands higher rates. And then higher demand for mortgages require higher rates. And lower money supply also requires higher rates as well (if all the money is being loaned out via credit cards and other debt, there's naturally less money for conventional mortgages).
I've always said home buying should only be allowed by American people and not by corporations (real estate businesses) because corps are only looking to make profit from real estate. An average American is maybe looking to sell the home to buy a bigger home and for the few that have the wealth to own multiple homes, at least other Americans have a better chance competing with them vs the real estate businesses within the home market. But I think it starts with corporations being protected by the Equal Protection Clause in the 14th amendment which states "corporations are people" and should have individual rights like a person. Remove this clause on corporations, and make home buying exclusive to individual Americans, ONLY THEN will the home market go back to being normal.
Who says that will lower prices? Companies that build a lot of houses to sell the houses can get much cheaper prices for building materials than you, as an individual, can ever get. That's where a big part of their profit margin sits.
I feel slightly bad, only slightly, for those that overextended their finances to purchase in the last two years, buying into the statement that they could refinance when rates inevitably went down. Don't trust MSM or real estate agents who have a direct incentive to sell you a home. Your interests are not aligned. Be informed and make smart, safe, decisions. I am so glad I didn't overextend to purchase a home at a stupid high price. Inflation has made too many things too expensive and you have to be ready for a rainy day, or month, or year.
Greedy real estate agents don't help my cause for purchasing my first home. Their commission should be 1% on both sides. If the fed drops interest rates to 1 percent then corporations would borrow so much money they would buy as much as they could. Maybe the fed should lower interest rates to 1 percent for first time home buyers.
essentially, the only interest rate the Fed actually controls is the Fed Funds rate which is the overnight lending rate between federally insured banks. The Fed doesn't control interest rates but it influences them to a small degree.
Actually it can be explained by 1 word: "greed". Although we're talking about "the market" decides the mortgage rate, in actual fact, there are only so many major mortgage companies in US. If they don't get a gentle nudge from the Fed board or the federal government, they will always be quick to raise rates and slow to lower.
Because the private market and investors KNOW that CPI-inflation is bs. It is reflected in the treasury note markets, which directly affect mortgage rates.
Watch the video you id10t. With current rates a 30 year mortgage will cost more in interest than in house. Housing values aren't up, in fact in select places they are down because few can afford the monthly payments and extra down payment.
26% cash buyers are not necessarily coming from corporate firms. Californian's are selling their million dollar homes and relocating with their proceeds to buy cheaper in other states. I live in Texas, and about 80% of the residents in my community relocated to the state in the past years.
BINGO! I live in Florida and we see the same scenario. I see a good amount of California and New York state arriving everyday. They are paying cash for their homes and plus more.
Wait, can someone who understands this explain this to me? At 6:15 they said that the fed buying mortgage backed securities lowered the mortgage interest rates... wouldn't that do the opposite? Wouldnt that create more demand for mortgage backed securities in turn raising the mortgage interest rates? Did the creators of this video make a mistake? How would it lower the mortgage rates? Please help. Thank you.
This is why single family rentals and built to rent communities are thriving, home ownership without all the costs. Taxes, INS, HOA, maintenance, Mortgage Payments. Yes rents are high because of it. Rent for 5 years, when things return to normal, and you get the feeling of living in a home and not some crappy apartment or parents house, and you get a yard(more privacy), Only problem to this is they are located away from the city due to high land prices the closer you go towards a city.
Translation: because of greed, we're not gonna be changing the interest rates on mortgages anytime soon, so why not get an ARM instead? Maybe that will help 🤷🏿♂️ I'll pass
3:55 Weaker economic data means the buyers who can't buy now because they are looking for more affordability are in an even more precarious financial position, so how does that help people who already can't get into a home?
Huge, how did you achieve such biweekly returns? I'm a newbie and I've lost a lot of money investing on my own. Please how do I go about it, the year is almost coming to an end, how can I make profit?
Hello, I am very interested. As you know, there are tons of investments out there and without solid knowledge, I can't decide what is best. Can you explain further how you invest and earn?
As a beginner, it is essential that you have a mentor to help you stay accountable. In my case, Miss Luara Clarence has guided me for years and I highly recommend her. I focus on her. To be honest, I'm almost hesitant to let someone take charge of growing my finances, but I'm so glad I did.
QE was always a huge unknown when these programs started more than 10 years ago. There's always hind sight "I wish I bought more house," but in the end I think it's a good thing that the real risks of buying a home are more apparent and less subsidized by the Fed. This is reality...
No this is over simplistic garbage. It's supply and demand nuances as explained in the video which you didn't seem to watch. You probably left this comment at 0:01
I wouldn’t say it’s so simple, home buyers are directly at fault for over paying, getting into bidding wars, etc back when rates where below 3%. Now so many people locked in at low rates (and who spent serious sums of money) aren’t selling, interest rates are higher, housing supply is limited so prices have remained high. It’s tough to get a homeowner who got into a bidding war and spent 100+k over what a typical house was in 2020, to sell at a lower cost all while losing that sweet interest rate.
Housing prices never go down, they always go up. Now is always the best time to buy a home. In this political landscape, regulators won't do anything sensible and it'll take ages to get regulations passed so it's up to wages to go up. The best thing an individual can do is find a job that pays more or ask for a raise. That's makes the job market competitive for talent, hence raising wages. If you work under a union, bring up the cost of living when negotiating contracts.
Whatever the Fed rate is the mortgage rate will always be a couple points higher. If the current Fed rate is between 4 and 5 percent, then there is no way that mortgage rates can be less than 4 %.
This reporting is totally disingenuous, mtg rates going up didn't make housing unaffordable, it was mtg rates going so low for 12yrs that made housing unaffordable.
Not really. I guess people were use to buying bigger houses because they could afford the loan, but in this case the cost of housing isn't the problem it's the cost to borrow
Rich buying homes in full cash at all time high, hence why there is such low supply. We can solve this problem by taxing those who wealthy enough to buy homes with full cash. Dare I utter those words... THIS WILL STOP THE BS RICH FROM BUYING UP ALL OF THE SUPPLY
I think thats mostly boomers moving out of high priced regions and getting a million dollars for some dump they paid $174,000 35 years ago. They then move to a cheaper area and pay cash for a 500K home.
Because fed rates don't directly tie to mortgage rates. Mortgage rates are tied to long term treasuries. Related, but not a 1:1. So many comments crying by people who simply know nothing about money and blindly blame corporations and the opposite political side for every single problem
Let’s be real it’s because real estate developers & people who buy real estate are greedy & will always want more than they paid. Doing so for decades will balloon the price to where the raw materials to build a house & even labor are significantly lower than what they inevitably ask for it.
The simplest solution is to BUILD more DENSE housing preferably near public transit. And put a stop to Corporate landlords. It won't solve the whole housing crisis, but it very much will help address it.
This is a separate issue from the FED, because commercial real estate is about to boom again……no sure why you think the fed cutting rates would make it somehow harder than it already is to get a mortgage but ok
5:23 isn't a higher spread a sign that there is less confidence borrowers will be able to pay their mortgages? If the Main Street economy were that great, there wouldn't be as much hesitation to lend.
People dont understand fed fund rate is still 4.25%, which is 400bps higher than rates of 0.25% from 2020. To get back to 2-3% mortgage rate, you need fed funds to drop back to 0-0.25%. Mortgage rates are already off its high based off 100bps rate cut so clearly it is working
@steven8628 2-3% interest rates are very unrealistic and were artificial. They were only that low because of artificially massaging the rates down to create activity during the covid crisis. It is not normal.
Rent is in many cases higher than mortgages! Everything is outta sync! Since housing is so expensive, more ppl are renting, so rent is incredibly expensive!
I'd like to know where Jordan Jackson is getting the stat that 8 years is the average maturity of a mortgage in USA. I call straight up BS on that and can only assume a ton of people keep refinancing to stay a float considering how entreched USA is debt.
He didn’t say 8 years for maturity. He said people pay off their mortgage in about rights usually due to selling the home and moving/buying something else or going to rent.
It's not really the rates. My first mortgage was 9.38%, but on a much less expensive home. I did a lot of research 4 years ago and got 2.97%. My house value has doubled since then. And that would be a killer for any buyer.
The house has probably fallen in value since you checked. At near zero interest there's a lot of speculative bubbles and houses in your neighborhood might have sold for ridiculous values but that doesn't mean you could find any buyer now
IM SO TIRED of all the focus on interest rates! New houses are built poorly, in the wrong places, and not what the average person is looking for…therefore inflating prices.
Force companies that own property to pay their employees 3 times rent minimum. That would discourage them from wanting to own it. Leave home to the people
I'm afraid not, it's what happens when you print $7 Trillion dollars. A lot of people bought up new homes and additional homes in 2020-2022. Those people are locked in and demand is massively pent up for Gen Z buyers. The housing market will explode again in 2025 even if rates dip a little bit.
Supply and demand. There is greed though. Many people and corporations buy more than one single family dwelling to rent out. Just build more homes and prices will come down, well unless you allow millions of people into the country or there's an explosion in population.
Homes are overpriced. We build too many HUGE homes. We don't have enough new homes. Zoning/NIMBY problems. Too much private equity in homes. Professionals: The problem is high mortgage rates!!!! .... er... No... While lower rates would be nice, if there were more affordable homes, fluctuating rates (as they always do) would be just something to be aware of, as they historically are. 3% was abnormally low. 18% was abnormally high. 6%-7%? That is not the problem with the housing market.
lower Mortgages doesnt mean lower prices, it is not enough supply. more people going to buy and pop the price up. is gonna be bidding war all over again if mortage drop too low.
ARMs shouldnt even be a thing, nor should my loan be adjusted or redone to then become an ARM, all home loans should be LOCKED at whatever the rate is, and the rate should be LOCKED so low that the average homeowner shouldn't have to be locked into a 30 year ball and chain.
Simply, the US has too much debt - as a percent of GDP - and there is little appetite for foreign nations to buy as much long duration debt, like 20- and 30-year treasuries. The rates of 30-year fixed mortgages are determined by the rate of the 30-year treasury, with some premium added for delinquency and default risk for lenders. The Fed has no control over the long duration treasury rates. In fact, aggressively lowering the overnight rate, if it stimulates the economy too much and feeds inflation expectations, could even drive 30-year rates higher. It also doesn't help that the global economy is depressed, so foreign nations have less capacity to buy US treasuries, and also weaponizing US treasuries, as was done with seizing Russia's US-held foreign reserves, doesn't inspire China to want to buy more, particularly if there at some point a conflict over Taiwan. In fact, China has been dumping US treasuries. The US government needs to gets is finances in order, and also reestablish a non-political posture with US treasuries, guaranteeing that no action be taken against foreign holdings even in times of war and for nations who the US may sanction in other respects.
The US doesn't remember 2008 it seems, like the real great depression, the oil crisis of 70's into 80's, etc. A true capitalist market should self regulate, ie GM, Ford, and Chrysler bankrupt rather than tax dollar going to them vs healthcare.
Which are highly correlated to the 10 year.. the MBS market pays very close attention to government bonds as they are a risk free alternative to mortgage lending. When the 10 year goes up mortgage rates go up.
Interest rates shou have never gone below 5 percent. You reap what you sow yes they may have purchased at 2 percent but a house sold at an overinflated price. Enjoy the higher insurance and property tax.
Man wish I managed to grab (euro) mortgage with rate 0,99% for 10 years or 1,39% for 20 years in 2022 - would be almost for free compared to my (still great) 3% for 5 years lock in rate.
The housing market will collapse in areas where homeowner's insurance is becoming unavailable or unaffordable. Do not own real estate in an areas that are prone to hurricanes or wildfires.
Huge, how did you achieve such biweekly returns? I'm a newbie and I've lost a lot of money investing on my own. Please how do I go about it, the year is almost coming to an end, how can I make profit?
Hello, I am very interested. As you know, there are tons of investments out there and without solid knowledge, I can't decide what is best. Can you explain further how you invest and earn?
As a beginner, it is essential that you have a mentor to help you stay accountable. In my case, Miss Luara Clarence has guided me for years and I highly recommend her. I focus on her. To be honest, I'm almost hesitant to let someone take charge of growing my finances, but I'm so glad I did.
Get corporations out of home ownership
Corporations are only a small part of the problem. Fix zoning laws, subsidize new housing development to increase supply, and house values will come back down to earth.
@@SnowBalling Accurate too, but there's no incentive to do this while corporate is still deep in residential real state.
Nah its just your entitled loser
@@SnowBallingsite your source
24% cash buying rate means the very well off are buying houses right now 🤠
Remember how we were told ALL YEAR "once the Fed starts trimming rates, mortgage rates will go down!!!" - yeah...about that.
Yeah I bought my first place last year, kept getting told to wait because it would go down. There's no way its ever that low ever again, and if it ever dips below 4% again, the FOMO will be huge and the market will be so insane that you won't be able to find a place.
“Transitory” 😂😂😂
It's a mathematical fact they will
@@samsonsoturian6013 Lol no its not.
Nah, you don't understand how market rate works @@samsonsoturian6013
Home's don't FEEL unaffordable... they ARE unaffordable. This is what happens when a feckless Central Bank prints and buys trillions of dollars of government debt to artificially drive down interest rates. The entire RE market got repriced when you could get a 30 year mortgage for 2.85%. Of course mortgage rates are going up- investors aren't stupid and they are legitimately worried about future inflation and don't want to get paid back in confetti. Longer dated debt, 10+ years could care less about the FED's stupid Federal Funds Rate.. that is 24 hour debt with zero duration risk. Longterm and short-term debt are entirely different markets. Mortgage rates are going higher.
They are stabilizing the housing market in Ukraine.
It's because we are getting screwed by crooks.
Only you
I think that the growing manipulation by investors that are buying up a large amount of the housing has also increased housing prices and the government isn't doing anything about it and these reports don't adequately shed light on how they corrupt the system.
Because companies are banking on us being used to the high prices.
That's right. The 'powers' control our lives. They decided to create 'covid' as a 'smokescreen' to jack up the prices of everything. They blame it on 'inflation' that THEY created. About every decade they pull off the same 'BS'......
This is why Luigi is being praised not scolded for doing something about the current system. Someone's going to loose their home (owned or not) and do something about something..😅
We’re focusing on the wrong things… House prices are too high! If those came down by 30%, I won’t care what the Mortgage rate percent is
Exactly. That is how it was in the 80s. That is why baby boomers were able to buy homes in a crazy amount even though rates were around 10%.
🤓 akkuuuallly homes are an InVeSTmeNT /s
Get hedge funds and people with multiple homes tf away from the SFH market. It should never be considered an investment
@@fixerdrew02 Exactly.
Exactly
Both are important and are also related
It's called greed. Rich people would rather destroy their own country rather than asking for a realistic amount, then they go to war against homeless people. It makes no sense.
No this is over simplistic garbage. It's called supply and demand as explained in the video. It's a lot more nuanced then just greed, it's a complicated market that gets influenced by the fed. Did you even watch the video?
Right. Because patriotism doesn't exist for the rich. It's just how they organize the rest of us.
Where the greed comes in is the zoning laws. The houses are worth whatever people will pay, but they block new housing development with zoning laws to keep house values high.
based on your comment, you have zero understanding of economics. Mortgage rates are high(er) because they are competing for savers' dollars with consumers, businesses, state and local governments, and.... the Federal government. In case I'm not being clear, the Federal government is crowding out all the other borrowers from the credit marketplace. If the Treasury borrowed less, more dollars would be available to fund mortgages (at lower interest rates).
@@SnowBalling You've seen the first chart presented on this video; What is the point of making more houses if people can't afford to buy them??? From 2021 to 2024 you're literally paying four times more in interest than you would have paid 3 years prior. THIS IS GREED plan and simple!~
Ugh, $1,373 a month vs $2,222 hurts a lot.
Between corporations buying houses and home builders controling the supply to keep the prices high. The average buyer gets priced out and risks more on a higher interest rate in order to buy a house.
Your wages just aren't keeping up with inflation.
Its hard to compete with BlackRock buying up houses
This is why Luigi is being praised not scolded for doing something about the current system. Someone's going to loose their home (owned or not) and do something about something..😅
I feel fortunate. I locked in at 2.75 but by the time my mortgage close it was 2.9. I'd be paying over $1000 more a month if I had to do it today.
Wow. That is a very good deal in this economy 👍
Yup all my friends sitting at 2-3% said they are dying with that house 😂
thats the thing. I see in comments of similar posts/videos of people blaming others for "not living within their means and work harder" but the truth is a lot of those commenters absolutely could not buy their house in today's economy (even just a few years ago!). It has gotten exponentially harder/worse **not saying you're one of those people btw.
@@Shaojeemy with the way things are going, a lot of us gonna be dying in other peoples' houses ..
A lot of people took too much advantage of that and now are bankrupt or stuck working jobs they hate
This is a supply side issue that is being exacerbated by both individual and corporate greed. You can’t have affordable housing when you have a bunch of corporations buying up large swaths of affordable homes and outbidding single buyers. That just makes a bad issue worse because we already have an issue with individual investors owning 10, 20+ properties and becoming rent seekers. Pair that with an environment where existing home owners do everything they can to prevent new construction of homes to protect their home values and you have an environment with high rates and incredibly limited supply, ridiculous housing prices, and an environment with incredibly low mobility
Zoning laws blocking new housing development is the big issue. If there's enough supply, it won't make sense for corporations to keep buying.
@@SnowBalling Even with more supply they will keep buying and buying and out bidding the average joe every time.
Corporate greed😂 my guy everyone is greedy look at the home sellers who refuse to sell their tiny box homes for under 500k
@@chadxlr3978 True but the Corporations are the ones buying those homes not the average joe.
Liars get scalped
American dream is dead for middle class workers.
The damage has been done, nobody is going to lower the asking price on their home. Half a million for what can be considered a started home is ridiculous.
Someone who actually wants to sell it will.
BUILD. MORE. HOMES.
Building homes will not fix the problem. Not at the rate business are buying up homes away from the average person. People are buying homes not to live anymore. They are buying them for investment and then selling it. It is no longer I buy a home and this is my home for YEARS.
Ya why don't u got start building some lazy
what do you think people are doing? they can't find a house so they pay to build one. that also costs money, back in the day men used to build their owns homes on free land.
@ you’re an idiot. Do you not realize how undersupplied we are? Build 10 million new housing units and this problem vanishes.
@@AChillin01Ryup. Corporations are buying up houses more than ever now. There’s even stocks average people can invest in for these companies making it worse. It’s almost like there needs to be regulations in place to prevent stuff like this happening by not allowing corporations to come into real estate for better good of America.
But as soon as you say that you got brainless people screaming commi or socialist who don’t even know what it truly means but just love the word.
So in other words, we’re screwed?
You don’t say! Tell me something I don’t know Buster.
For now. The current situation is untenable.
My parents bought a house in 2012 when their mortgage was going to be $2,200 compared to them paying $1200 a month for rent. Over ten years on the mortgage is half that and rent is now more expensive than when they bought their house.
It’s worth it to buy a home so long as you can reasonably afford it
Rates are not a problem. Mortgages should cost something, the issue mainly is the home prices.
They're virtually the same price they were in 2021. On a 30 year mortgage at current rates you will spend more on interest than on house, and that appears to make houses more expensive
Rates should be 10% with no more than a 15 year term... but na, the last thing the system wants is a bunch of debt free 40 year olds with a paid off house and a MBS market where you could make 7% risk free. No they want us all to be debt slaves and forced to invest in the stock market to see any kind of yield.
Excepts for prices don't come down.
@@jonb740 it starting to come down in big cities where people overpaid. This is true to places where you have military presence when they are forced to moved. Force movers will face reality soon.
@jonb740 they can and have gone down, it's just not likely due to inflation and rising population density
None of this matters if corporations out bet the sales and turn them into rental units.
High rates from the fed haven't helped but so is the lack of affordable housing.
So what? If you had the money I'm sure your landlord will sell to you
I think it’s going to be a long time before I can even find myself in a situation to buy a home. When they lowered interest rates, they exacerbated the problem we’ve had in this country, which is continually not building housing to keep up with demand since 2008. Homes overpriced. They’re probably not gonna go down. The average wage is not kept up with that and interest rates are high even if you lower interest rates you still have the fundamental problem of people don’t want to move out of there current interest rate and wages have not been able to keep up with the insane price increase housing has seen.
You can thank Bill Clinton and his administration for a lot of this.......and the banks...and the weasels ......quite a few businessmen , politicians, and 'certain' groups played a big role in this crises that's only getting worse.......Goes back to "Be careful what you wish for".......especially when you vote. Hell, anymore, I personally don't think the voting process matters. The powers that behave control of that too. They're going to place I office who they want ( oh they 'let' the people think it was their votes that counted); but it's all manipulated. They win, you lose....no matter ......
Record high house prices make it impossible for first time home buyers. Everything has gone up besides average people's wages!
Liar
Long term risk combined with high demand. Higher long term inflation risk demands higher rates. And then higher demand for mortgages require higher rates. And lower money supply also requires higher rates as well (if all the money is being loaned out via credit cards and other debt, there's naturally less money for conventional mortgages).
“Normal economic conditions” lol
I've always said home buying should only be allowed by American people and not by corporations (real estate businesses) because corps are only looking to make profit from real estate. An average American is maybe looking to sell the home to buy a bigger home and for the few that have the wealth to own multiple homes, at least other Americans have a better chance competing with them vs the real estate businesses within the home market.
But I think it starts with corporations being protected by the Equal Protection Clause in the 14th amendment which states "corporations are people" and should have individual rights like a person.
Remove this clause on corporations, and make home buying exclusive to individual Americans, ONLY THEN will the home market go back to being normal.
Who says that will lower prices? Companies that build a lot of houses to sell the houses can get much cheaper prices for building materials than you, as an individual, can ever get. That's where a big part of their profit margin sits.
So there would be no rentals at all?
Making housing an investable asset... what could go wrong?
I feel slightly bad, only slightly, for those that overextended their finances to purchase in the last two years, buying into the statement that they could refinance when rates inevitably went down. Don't trust MSM or real estate agents who have a direct incentive to sell you a home. Your interests are not aligned. Be informed and make smart, safe, decisions. I am so glad I didn't overextend to purchase a home at a stupid high price. Inflation has made too many things too expensive and you have to be ready for a rainy day, or month, or year.
Greedy real estate agents don't help my cause for purchasing my first home. Their commission should be 1% on both sides. If the fed drops interest rates to 1 percent then corporations would borrow so much money they would buy as much as they could. Maybe the fed should lower interest rates to 1 percent for first time home buyers.
essentially, the only interest rate the Fed actually controls is the Fed Funds rate which is the overnight lending rate between federally insured banks. The Fed doesn't control interest rates but it influences them to a small degree.
The buyer doesn't pay the commission.
@@sacrugby1 But now they can with the law that passed.
@@sacrugby1 Where do you think the money comes from? Just like credit card processing fees, its always the buyer footing the bill.
Realestate agents have nothing to do with affordability.
Let individuals borrow from the Fed at the same rates as the big banks.
Actually it can be explained by 1 word: "greed". Although we're talking about "the market" decides the mortgage rate, in actual fact, there are only so many major mortgage companies in US. If they don't get a gentle nudge from the Fed board or the federal government, they will always be quick to raise rates and slow to lower.
Because the private market and investors KNOW that CPI-inflation is bs. It is reflected in the treasury note markets, which directly affect mortgage rates.
Nobody cares about the mortgage rate. It’s the PRICES of the houses that scare me.
Watch the video you id10t. With current rates a 30 year mortgage will cost more in interest than in house. Housing values aren't up, in fact in select places they are down because few can afford the monthly payments and extra down payment.
I see you are not too smart 😂😂😂 imagining paying 2500 mortgage and 1700 goes to interest
26% cash buyers are not necessarily coming from corporate firms.
Californian's are selling their million dollar homes and relocating with their proceeds to buy cheaper in other states.
I live in Texas, and about 80% of the residents in my community relocated to the state in the past years.
BINGO! I live in Florida and we see the same scenario. I see a good amount of California and New York state arriving everyday. They are paying cash for their homes and plus more.
This is very true
Need more housing. That would be a start.
Wait, can someone who understands this explain this to me? At 6:15 they said that the fed buying mortgage backed securities lowered the mortgage interest rates... wouldn't that do the opposite? Wouldnt that create more demand for mortgage backed securities in turn raising the mortgage interest rates? Did the creators of this video make a mistake? How would it lower the mortgage rates? Please help. Thank you.
I was blessed enough to have gotten my home in the middle of the pandemic at 3.2%. Unless rates go below that ever again, I am sitting right here.
they are going up. look up inflation
The beautiful thing that the US does well, is the availability of the 30 year fixed. (vs many countries that typically only offer ARM's)
ARMs played a big part in the housing bubble crash.
This is why single family rentals and built to rent communities are thriving, home ownership without all the costs. Taxes, INS, HOA, maintenance, Mortgage Payments. Yes rents are high because of it. Rent for 5 years, when things return to normal, and you get the feeling of living in a home and not some crappy apartment or parents house, and you get a yard(more privacy), Only problem to this is they are located away from the city due to high land prices the closer you go towards a city.
Don’t worry. The elites are on watch. It might take a while. But eventually you’ll get people like Luigi Mangioni
Translation: because of greed, we're not gonna be changing the interest rates on mortgages anytime soon, so why not get an ARM instead? Maybe that will help 🤷🏿♂️
I'll pass
3:55 Weaker economic data means the buyers who can't buy now because they are looking for more affordability are in an even more precarious financial position, so how does that help people who already can't get into a home?
$80k every 4 weeks! I now have a good house and can now afford anything and also support my family😎
Huge, how did you achieve such biweekly returns? I'm a newbie and I've lost a lot of money investing on my own. Please how do I go about it, the year is almost coming to an end, how can I make profit?
Hello, I am very interested. As you know, there are tons of investments out there and without solid knowledge, I can't decide what is best. Can you explain further how you invest and earn?
As a beginner, it is essential that you have a mentor to help you stay accountable. In my case, Miss Luara Clarence has guided me for years and I highly recommend her. I focus on her. To be honest, I'm almost hesitant to let someone take charge of growing my finances, but I'm so glad I did.
Wow Wow her too Miss Luara Clarence is a remarkable individual whom has brought immense positivity and inspiration into my life.
The very first time we tried, we invested $2000 and after a week, we received $9500. That really helped us a lot to pay up our bills.
QE was always a huge unknown when these programs started more than 10 years ago. There's always hind sight "I wish I bought more house," but in the end I think it's a good thing that the real risks of buying a home are more apparent and less subsidized by the Fed. This is reality...
Just got mine at 6.1 !
Simple. It's corporate greed.
No this is over simplistic garbage. It's supply and demand nuances as explained in the video which you didn't seem to watch. You probably left this comment at 0:01
"Corporate greed" or "President I don't like" is actually not the answer to all economic issues like the majority of Americans believe.
I wouldn’t say it’s so simple, home buyers are directly at fault for over paying, getting into bidding wars, etc back when rates where below 3%. Now so many people locked in at low rates (and who spent serious sums of money) aren’t selling, interest rates are higher, housing supply is limited so prices have remained high. It’s tough to get a homeowner who got into a bidding war and spent 100+k over what a typical house was in 2020, to sell at a lower cost all while losing that sweet interest rate.
Corporate buyers are 5% of the market, so no. It’s supply and demand. We have under built housing for thirty years.
Housing prices never go down, they always go up. Now is always the best time to buy a home. In this political landscape, regulators won't do anything sensible and it'll take ages to get regulations passed so it's up to wages to go up. The best thing an individual can do is find a job that pays more or ask for a raise. That's makes the job market competitive for talent, hence raising wages. If you work under a union, bring up the cost of living when negotiating contracts.
That was so dumb my brain hurts now
Whatever the Fed rate is the mortgage rate will always be a couple points higher. If the current Fed rate is between 4 and 5 percent, then there is no way that mortgage rates can be less than 4 %.
This reporting is totally disingenuous, mtg rates going up didn't make housing unaffordable, it was mtg rates going so low for 12yrs that made housing unaffordable.
Not really. I guess people were use to buying bigger houses because they could afford the loan, but in this case the cost of housing isn't the problem it's the cost to borrow
26% paid in cash!
Yeah that’s nuts!
Rich buying homes in full cash at all time high, hence why there is such low supply.
We can solve this problem by taxing those who wealthy enough to buy homes with full cash. Dare I utter those words... THIS WILL STOP THE BS RICH FROM BUYING UP ALL OF THE SUPPLY
I think thats mostly boomers moving out of high priced regions and getting a million dollars for some dump they paid $174,000 35 years ago. They then move to a cheaper area and pay cash for a 500K home.
Because fed rates don't directly tie to mortgage rates.
Mortgage rates are tied to long term treasuries.
Related, but not a 1:1.
So many comments crying by people who simply know nothing about money and blindly blame corporations and the opposite political side for every single problem
This is EXACTLY what a normal housing market looks like. We got spoiled by a housing glut, free money and materialistic desire.
Let’s be real it’s because real estate developers & people who buy real estate are greedy & will always want more than they paid. Doing so for decades will balloon the price to where the raw materials to build a house & even labor are significantly lower than what they inevitably ask for it.
Especially for homes that have not even been upgraded. lol
This does not immediately impact your mortgage rate. Your mortgage rate is the cost to borrow. Low mortgage rates increase home prices.
The simplest solution is to BUILD more DENSE housing preferably near public transit. And put a stop to Corporate landlords. It won't solve the whole housing crisis, but it very much will help address it.
Both will go bankrupt immediately. I bet the lives of everyone on this thread
This id10t thinks the average landlord is a megacorp
People don’t want that, and you see it in the birthrates.
Obviously you don't live in a large city
This is a separate issue from the FED, because commercial real estate is about to boom again……no sure why you think the fed cutting rates would make it somehow harder than it already is to get a mortgage but ok
5:23 isn't a higher spread a sign that there is less confidence borrowers will be able to pay their mortgages? If the Main Street economy were that great, there wouldn't be as much hesitation to lend.
Look at how expensive mortgages are in Australia… we don’t have 30 year mortgages like the US.
People dont understand fed fund rate is still 4.25%, which is 400bps higher than rates of 0.25% from 2020. To get back to 2-3% mortgage rate, you need fed funds to drop back to 0-0.25%. Mortgage rates are already off its high based off 100bps rate cut so clearly it is working
@steven8628 2-3% interest rates are very unrealistic and were artificial. They were only that low because of artificially massaging the rates down to create activity during the covid crisis. It is not normal.
Rent is in many cases higher than mortgages! Everything is outta sync! Since housing is so expensive, more ppl are renting, so rent is incredibly expensive!
I'd like to know where Jordan Jackson is getting the stat that 8 years is the average maturity of a mortgage in USA. I call straight up BS on that and can only assume a ton of people keep refinancing to stay a float considering how entreched USA is debt.
He didn’t say 8 years for maturity. He said people pay off their mortgage in about rights usually due to selling the home and moving/buying something else or going to rent.
Boomers screwed our following generations-millennials, gen z, possibly gen alpha. And boomers are still like “I’d like to speak to the manager”
Bull. I paid 17.5% on a second mortgage in 1981 to buy my first house. Quit whining
It's not really the rates. My first mortgage was 9.38%, but on a much less expensive home.
I did a lot of research 4 years ago and got 2.97%. My house value has doubled since then. And that would be a killer for any buyer.
The house has probably fallen in value since you checked. At near zero interest there's a lot of speculative bubbles and houses in your neighborhood might have sold for ridiculous values but that doesn't mean you could find any buyer now
IM SO TIRED of all the focus on interest rates! New houses are built poorly, in the wrong places, and not what the average person is looking for…therefore inflating prices.
Too much "printing money" (fed buying bonds) in covid era . So now the " reverse gear" ,quantitative tightening. And it feels tight 😅
I love that the example used at 0:27 is a 420,400 house. Wtf does that buy you? A shack on 1/4 acre in rural Alabama?
The houses being built will not last 30 years.
Force companies that own property to pay their employees 3 times rent minimum. That would discourage them from wanting to own it. Leave home to the people
Powell is the grinch for Christmas. He made the stock market go red!!!
Greed, period! House prices are super inflated.
I'm afraid not, it's what happens when you print $7 Trillion dollars.
A lot of people bought up new homes and additional homes in 2020-2022. Those people are locked in and demand is massively pent up for Gen Z buyers. The housing market will explode again in 2025 even if rates dip a little bit.
No, it’s called the free market. Nobody is going to sell a home for less than it is worth and buyers don’t want to pay more than they have to.
I wish we had 7% morgage rates in South Africa. We are currently at 11.25%. It was 11.75 when we purchased earlier this year.
Supply and demand. There is greed though. Many people and corporations buy more than one single family dwelling to rent out.
Just build more homes and prices will come down, well unless you allow millions of people into the country or there's an explosion in population.
Rate cutting cycle is not doing anything.
The government is so out of touch!!
No taxation without representation !!!
Homes are overpriced. We build too many HUGE homes. We don't have enough new homes. Zoning/NIMBY problems. Too much private equity in homes.
Professionals: The problem is high mortgage rates!!!!
....
er...
No...
While lower rates would be nice, if there were more affordable homes, fluctuating rates (as they always do) would be just something to be aware of, as they historically are. 3% was abnormally low. 18% was abnormally high. 6%-7%?
That is not the problem with the housing market.
Get banks 🏦 out of the middle of everything.
Prices are based on whatever amount they loan. 🤓
lower Mortgages doesnt mean lower prices, it is not enough supply. more people going to buy and pop the price up. is gonna be bidding war all over again if mortage drop too low.
ARMs shouldnt even be a thing, nor should my loan be adjusted or redone to then become an ARM, all home loans should be LOCKED at whatever the rate is, and the rate should be LOCKED so low that the average homeowner shouldn't have to be locked into a 30 year ball and chain.
Feel unaffordable?😂😂😂 How about are unaffordable for average people
Consumers don’t “get” mortgages, they GIVE them. They get a mortgage LOAN.
Simply, the US has too much debt - as a percent of GDP - and there is little appetite for foreign nations to buy as much long duration debt, like 20- and 30-year treasuries. The rates of 30-year fixed mortgages are determined by the rate of the 30-year treasury, with some premium added for delinquency and default risk for lenders. The Fed has no control over the long duration treasury rates. In fact, aggressively lowering the overnight rate, if it stimulates the economy too much and feeds inflation expectations, could even drive 30-year rates higher.
It also doesn't help that the global economy is depressed, so foreign nations have less capacity to buy US treasuries, and also weaponizing US treasuries, as was done with seizing Russia's US-held foreign reserves, doesn't inspire China to want to buy more, particularly if there at some point a conflict over Taiwan. In fact, China has been dumping US treasuries.
The US government needs to gets is finances in order, and also reestablish a non-political posture with US treasuries, guaranteeing that no action be taken against foreign holdings even in times of war and for nations who the US may sanction in other respects.
The US doesn't remember 2008 it seems, like the real great depression, the oil crisis of 70's into 80's, etc.
A true capitalist market should self regulate, ie GM, Ford, and Chrysler bankrupt rather than tax dollar going to them vs healthcare.
It’s is BLISS for investors and over seas investors!!! Hurray corporate American 🇺🇸…..
.
Motgages are not based off the 10 year Treasury Note. Mortgages are bases off Mortgage Backed Securities which teade on the open mkt.
You're mixed up. Traders buy those for the relevant T-bill rate plus a suitable risk premium. Everything is priced of t-bills one way or another
Which are highly correlated to the 10 year.. the MBS market pays very close attention to government bonds as they are a risk free alternative to mortgage lending. When the 10 year goes up mortgage rates go up.
No you are wrong
Interest rates shou have never gone below 5 percent. You reap what you sow yes they may have purchased at 2 percent but a house sold at an overinflated price. Enjoy the higher insurance and property tax.
Man wish I managed to grab (euro) mortgage with rate 0,99% for 10 years or 1,39% for 20 years in 2022 - would be almost for free compared to my (still great) 3% for 5 years lock in rate.
We must cut spending and balance the budget because the government is consuming all of the credit by borrowing.
The market drops significantly today and this is the only video released today on this channel?
Bankers are telling the government what to do… when did they become more powerful than the government…. 😅
Didn’t they just cut interest rates a few months ago. Shouldn’t we wait a little to see the changes start kicking in
It will change very little.
It changes instantly. The 10 year up 10 basis points today which is a significant move. You will see higher mortgage rates by the end of the week.
The housing market will collapse in areas where homeowner's insurance is becoming unavailable or unaffordable. Do not own real estate in an areas that are prone to hurricanes or wildfires.
Is there any possible way to remove pmi with an fha loan?
Just so Americans know, other countries interest rates are way cheaper. Spain for example are 2%.
Get rid of the central banks
The US has about $10 trillion in short term bonds/notes coming due next year. Just wait for higher interest rates.
"Everthing is proceeding as I have foreseen."
I wonder which generation has created all these horrible realities for younger generations….
$80k every 4 weeks! I now have a good house and can now afford anything and also support my family😎
Huge, how did you achieve such biweekly returns? I'm a newbie and I've lost a lot of money investing on my own. Please how do I go about it, the year is almost coming to an end, how can I make profit?
Hello, I am very interested. As you know, there are tons of investments out there and without solid knowledge, I can't decide what is best. Can you explain further how you invest and earn?
As a beginner, it is essential that you have a mentor to help you stay accountable. In my case, Miss Luara Clarence has guided me for years and I highly recommend her. I focus on her. To be honest, I'm almost hesitant to let someone take charge of growing my finances, but I'm so glad I did.
Wow Wow her too Miss Luara Clarence is a remarkable individual whom has brought immense positivity and inspiration into my life.
The very first time we tried, we invested $2000 and after a week, we received $9500. That really helped us a lot to pay up our bills.
Price caps now!
Housing is a scam, everyone wants to cash their equity, but that means someone else is paying you that high price.