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RealEstateCafe
Joined: 11 Dec 2007
Posts: 235
Location: Cambridge, MA
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 Posted: Sun Nov 25, 2018 7:24 pm GMT Post subject: What The 1990s Tell Us About The Next Housing Bust |
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What The 1990s Tell Us About The Next Housing Bust
Tired of hearing that the next correction/bust won't be like 2008?
Here's what it's more likely to look like, the S&L bust.
If history repeats itself (it won’t) & current cycle peaks exactly 30 years later in 2019 instead of 1989, then real home prices would be down 7% by end of 2020, then fall slowly 'til 2027, real home prices wouldn’t get up back to 2019 levels 'til 2030.
In real prices;
• Boston didn’t get back to its 1987 peak until 2000 (13 years);
https://www.forbes.com/sites/johnwake/2018/11/02/the-next-housing-bust/
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Anon
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| Posted: Thu Nov 29, 2018 2:34 pm GMT Post subject: ? |
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I'm really struggling to understand any similarity from the 1980's/90's to today, other than people looking for a period of time with no housing price increases to justify their current thought process.
In the 90s mortgage rates were much higher than today, coming off of even higher rates previously in the 70s/80s. Today rates are low, coming off of even lower rates.
The S&L bust was a slow moving disaster over the course of years to unwind... I don't see a similar situation today.
The economy in the Boston area is being driven by a completely different set of factors than it was in the pre-internet era. |
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Guest
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| Posted: Sat Dec 01, 2018 1:58 pm GMT Post subject: Re: What The 1990s Tell Us About The Next Housing Bust |
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| RealEstateCafe wrote: | What The 1990s Tell Us About The Next Housing Bust
Tired of hearing that the next correction/bust won't be like 2008?
Here's what it's more likely to look like, the S&L bust.
If history repeats itself (it won’t) & current cycle peaks exactly 30 years later in 2019 instead of 1989, then real home prices would be down 7% by end of 2020, then fall slowly 'til 2027, real home prices wouldn’t get up back to 2019 levels 'til 2030.
In real prices;
• Boston didn’t get back to its 1987 peak until 2000 (13 years);
https://www.forbes.com/sites/johnwake/2018/11/02/the-next-housing-bust/ |
Nice article, but everyone thinks/acts on nominal prices. Nominal prices will continue to rise until the next recession, but no one really knows when that will happen. |
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Guest
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| Posted: Wed Dec 05, 2018 12:51 pm GMT Post subject: |
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| I'm foaming at the mouth for a crash🔥🔥🔥 |
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Guest
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| Posted: Wed Dec 05, 2018 4:42 pm GMT Post subject: |
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| Anonymous wrote: | | I'm foaming at the mouth for a crash🔥🔥🔥 |
To me a crash would mean an abrupt drop by a significant amount.
Unless and until there's a recession, I don't expect it. Especially in the
towns where you probably want to live. |
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Guest
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| Posted: Thu Dec 06, 2018 12:47 am GMT Post subject: |
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| Quote: | To me a crash would mean an abrupt drop by a significant amount.
Unless and until there's a recession, I don't expect it. Especially in the
towns where you probably want to live. |
I don't think it will be abrupt because the rates rising has not been abrupt. If the Fed keeps rolling off 50 billion a month, with or without continued raising of the fund rate, mortgage rates will rise. Prices are already down. I believe they'll continue flat and down, flat and down, flat and down and so on. Eventually they'll level out sideways. Real estate appreciation in Boston is over for the foreseeable future. |
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Guest
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| Posted: Thu Dec 06, 2018 1:45 am GMT Post subject: |
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| Anonymous wrote: | | Quote: | To me a crash would mean an abrupt drop by a significant amount.
Unless and until there's a recession, I don't expect it. Especially in the
towns where you probably want to live. |
I don't think it will be abrupt because the rates rising has not been abrupt. If the Fed keeps rolling off 50 billion a month, with or without continued raising of the fund rate, mortgage rates will rise. Prices are already down. I believe they'll continue flat and down, flat and down, flat and down and so on. Eventually they'll level out sideways. Real estate appreciation in Boston is over for the foreseeable future. |
Just make sure you beat every other Tom, Harry and Jane in Boston who all seem to be waiting on the sidelines for price falls since 2011... |
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Guest
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| Posted: Thu Dec 06, 2018 5:51 pm GMT Post subject: |
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From 2011 to almost 2019. That's 8 years of pent up demand.
That much demand will keep prices propped up. |
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Guest
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| Posted: Sat Dec 08, 2018 1:07 am GMT Post subject: |
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| Quote: | | Just make sure you beat every other Tom, Harry and Jane in Boston who all seem to be waiting on the sidelines for price falls since 2011... |
Not since 2011, since 2015. Price appreciation was normal(2%-4%) from 2011-2014. Since 2015 Real Estate is up 30%. Pop pop fizz fizz time. |
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Guest
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| Posted: Sat Dec 08, 2018 3:42 am GMT Post subject: |
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| Anonymous wrote: | | Quote: | | Just make sure you beat every other Tom, Harry and Jane in Boston who all seem to be waiting on the sidelines for price falls since 2011... |
Not since 2011, since 2015. Price appreciation was normal(2%-4%) from 2011-2014. Since 2015 Real Estate is up 30%. Pop pop fizz fizz time. |
I love how the term "normal" is just thrown out there, as if the results of federal reserve policy, declining unemployment, employment centered in major cities, lack of ability to build in an area, and 50 other things "obviously" translates into 2-4% growth. Because gosh darn it, I think that real estate should appreciate at 2-4% and therefore anything different is wrong! Historically low building rates for population growth, job growth in high paying jobs in the area etc. don't have anything to do with it I guess. Here's an idea that might blow your mind... ever think about why prices in San Francisco are higher than Boston? Or why prices are higher in Boston than they are in North Dakota? Must be a bubble everywhere but Iowa I guess?
Again, I'll cross my fingers for you although maybe I don't have to since I'm speaking with the one guy who knows 100% that current prices have to be a bubble. I could argue actual points with you, but I"m sure you don't have any other than "its gone up a lot and I don't like it therefore its a bubble and I'm going to make a killing when it pops". And I'm positive in 2011 you were or would have been saying EXACTLY the same thing. And next Spring when housing prices have appreciated another couple % and paper is more expensive you'll still be waiting.
The truth is, every renter in the city "knows" prices are too high and thinks they are going to be the smart ones to jump on it when this sudden collapse happens. Meanwhile, rising interest rates are trapping people in their houses and are going to dry up entry level supply when those owners don't want to give up refinanced 3.5% loans to upgrade, and there is nowhere else to build around Boston. This brainless analysis that there is 1:1 correlation between interest rates and housing prices is going to screw a lot of suckers over in the next couple of years. Yes, demand will likely fall with interest rates rising, but so will supply. Again, too complicated to understand I'm sure, just keeping saying "bubble", I'm sure you'll be buying 600K condos for 400K in no time. |
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Guest
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| Posted: Sat Dec 08, 2018 2:24 pm GMT Post subject: |
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| Anonymous wrote: | | Anonymous wrote: | | Quote: | | Just make sure you beat every other Tom, Harry and Jane in Boston who all seem to be waiting on the sidelines for price falls since 2011... |
Not since 2011, since 2015. Price appreciation was normal(2%-4%) from 2011-2014. Since 2015 Real Estate is up 30%. Pop pop fizz fizz time. |
I love how the term "normal" is just thrown out there, as if the results of federal reserve policy, declining unemployment, employment centered in major cities, lack of ability to build in an area, and 50 other things "obviously" translates into 2-4% growth. Because gosh darn it, I think that real estate should appreciate at 2-4% and therefore anything different is wrong! Historically low building rates for population growth, job growth in high paying jobs in the area etc. don't have anything to do with it I guess. Here's an idea that might blow your mind... ever think about why prices in San Francisco are higher than Boston? Or why prices are higher in Boston than they are in North Dakota? Must be a bubble everywhere but Iowa I guess?
Again, I'll cross my fingers for you although maybe I don't have to since I'm speaking with the one guy who knows 100% that current prices have to be a bubble. I could argue actual points with you, but I"m sure you don't have any other than "its gone up a lot and I don't like it therefore its a bubble and I'm going to make a killing when it pops". And I'm positive in 2011 you were or would have been saying EXACTLY the same thing. And next Spring when housing prices have appreciated another couple % and paper is more expensive you'll still be waiting.
The truth is, every renter in the city "knows" prices are too high and thinks they are going to be the smart ones to jump on it when this sudden collapse happens. Meanwhile, rising interest rates are trapping people in their houses and are going to dry up entry level supply when those owners don't want to give up refinanced 3.5% loans to upgrade, and there is nowhere else to build around Boston. This brainless analysis that there is 1:1 correlation between interest rates and housing prices is going to screw a lot of suckers over in the next couple of years. Yes, demand will likely fall with interest rates rising, but so will supply. Again, too complicated to understand I'm sure, just keeping saying "bubble", I'm sure you'll be buying 600K condos for 400K in no time. |
You are wasting your effort trying to reason with idiot renters. Spend your energy helping yourself, your family and your friends. |
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Guest
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| Posted: Mon Dec 10, 2018 3:49 pm GMT Post subject: |
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| Price appreciation is over whether your a renter, buyer or owner. Opinions vary, I guess each buyer has to do what they think. I think it's obvious sentiment has changed. Volume is way off and prices are declining. Those who can't see that have bigger problems. |
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Guest
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| Posted: Mon Dec 10, 2018 6:54 pm GMT Post subject: |
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| Anonymous wrote: | | Price appreciation is over whether your a renter, buyer or owner. Opinions vary, I guess each buyer has to do what they think. I think it's obvious sentiment has changed. Volume is way off and prices are declining. Those who can't see that have bigger problems. |
Prices are up year over year, not down, so I don't know where these "declining" prices are you are talking about. Volume looks similar to last year as well.
https://www.trulia.com/real_estate/Boston-Massachusetts/market-trends/
I see zero information that backs up anything you are saying so I guess I have a "bigger problem" for actually looking at the data and not just going by "housing sentiment", as if that is ever great in December. The guy above is correct, its a waste of time trying to argue with renters. Unless you're in the federal reserve and know what is happening with interest rates, your opinion is basically worthless, and saying things like "Price appreciation is over" as if you have any clue comes off as completely delusional. Maybe it is, maybe it isn't. There isn't any evidence that is the case to my eye though, and the federal reserve may very well not go through with another rate hike after december dramatically altering the little analysis you're doing right now. |
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Guest
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| Posted: Mon Dec 10, 2018 7:39 pm GMT Post subject: |
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I work with 6 people who are recently married. Every one of them has bought
a house recently.
Apparently there's something about getting married that makes people want
to buy a house. |
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Guest
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| Posted: Mon Dec 10, 2018 8:21 pm GMT Post subject: |
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| Sounds like you should go buy some houses😂😂😂 |
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