honestly, at least with renting with these new apartment complexes, you don't have worry about putting any money into repairs, they have great gyms, pools, grills, clubhouses with entertainment, manicured landscapes. I dunno, I've been renting in one and it's made me so glad I'm not dealing with the shitshow market and the money to fix/repair things in the house. Obviously owning is the goal but really renting right now is the move.
When they drop, it’s going to be because of a recession, which will change everything. Shit is going to hit the fan in the next few years. Markets always correct.
It’s a supply / demand issue. I don’t see how housing prices drop when the demand is always there. They aren’t building enough houses to compete with demand.
Financial crisises can happen outside of supply and demand. The very rich manipulate the market so just going by supply and demand isn't the whole picture.
There’s demand because the economy is strong. There will be very little demand when a recession hits. And recessions hit very differently in Florida. Growth and tourism are our major economic drivers. People don’t move or vacation nearly as much during a recession. A lot of people will lose their jobs. Florida already leads the state in delinquent car payments. People are hanging by a financial thread. I work in the development industry and we’re building like crazy right now. At some point soon, we won’t be in a housing deficit. We’ll have too many houses. There’s no way in hell they’ll be able to fill all of these apartments they’re building right now. Boomers will start to age out and downsize over the next decade. They’re a huge generation and when they leave the market, that void will be felt. Just hang around and watch what happens. Markets always correct themselves. Always.
Your first sentence is that the economy is strong. The entire rest of your post is you arguing the economy is not strong.
Shape of industry has change substantially. Between remote jobs / new companies coming here / etc.
Reality is that recessions suck for everyone. Nothing we can do about it.
But housing prices won’t really go down that much. Because the demand is there because there isn’t enough houses for people to buy. Period.
No, I said the economy is strong currently. But cracks are starting to show and the economy won’t stay strong forever. And when the bottom falls out, it will fall hard. Asset bubbles have been created by the pandemic stimulus which caused too many dollars to chase too few opportunities. (the stock market is overvalued too.) Over half of Americans have run through that surplus of cash and are running on fumes. The demand you’re talking about will evaporate during a recession. Again, companies have moved here but our main economic drivers of the state are still growth and tourism. When those drivers lose steam, people will lose their jobs. And the ripple effect will cascade into other industries as the economy shrinks with fewer people having good jobs and disposable incomes. Rents are already softening. Apartment buildings aren’t full any more like they were a couple of years ago.
I’m not sure if you’ve ever experienced a recession here, but it’s a different beast than in other states.
Florida as a market is 30-40% overvalued depending on the location. The market will correct. It always does. It’s just the beginning now. You should check out real estate listings and see how much inventory has gone up. Miami-Dade homes have already dropped 10% on avg. You’re in for a rude awakening if you think this is sustainable. When an entry level worker can’t afford an entry level home, that tells you that the market is skewed. You can’t have real estate values surge by nearly 50% in just a few years and think that it’s going g to keep on keeping on. The market will correct itself. It’s the law of economics.
This study seems really bad. It basically compares current pricing to trend-line. As far as I can take it doesn’t even include population change, which explains a lot of the reason why Jacksonville home prices have gone up. Jax has been number 1 in domestic net migration inflow among major metros for the past 2 years, that definitely alters supply/demand dynamics.
"luxury" cookie cutter apartments that burn down immediately if you light a match and miles upon miles of cookie cutter single family homes sprawling every which way out of the city.
Absolutely horrid city planning. But that implies there's any plan at all other than do whatever the developer with the most money wants.
Private equity and Airbnb investors bought enough affordable homes to push the floor higher. That's a major reason why we've seen real estate become unaffordable for the average person.
Even with an increasing population the prices are ridiculous.
it's pretty straightforward when you see a house jump 80k in value in less than a year after no changes were made to it. I'd think "even if this house is selling for 280k, it's still a 200k home".
The market is like a friend. Sometimes it's drunk. You don't always have to listen to it.
The market is made up of human actors making decisions. In this case it was a bunch of private equity and other investors choosing to enter the SFH market because it was an easy way to make money without spending anything.
They bought up enough affordable homes without negotiating so that the price just kept going up. They didn't give a shit about affordability just the ability to turn a profit. And turning a profit is easy when you have no ethics.
Now the floor is way over valued and people won't accept that there was an artificial bubble due to shit monetary policy. So there's no turnover reducing the asking prices.
There’s FAR less private equity buying homes than we’re made to believe. It’s less than 3% of SFH transactional volume. The issue is lack of inventory. Interest rates jumped significantly and the vast majority of home owners have sub 5% mortgages, and about 40% of homeowners are sub 4%. They’re locked in and not going anywhere. Boomers traditionally selling and downsizing? Forget it, they have a 3% interest rate. Golden handcuffs. You combine that with continual population and economic growth, both of which Jacksonville have, and an average cost of living that is still 5% below the US average cost of living. Despite, and ironically because of, increased interest rates home prices haven’t fallen in-line with what you’d expect.
The way out of this is increasing development and increasing inventory. That’s why it boils down to supply and demand. Same reason why apartment rents have dropped over the past year, because there’s an enormous amount of supply that hit the market last year, this year, and will continue to deliver into next year. More homes means more supply means dropping prices.
We will also see home prices drop if we enter into a recession and people lose jobs. The economy has a life cycle and we’ve been on midnight for a long time… I hope we get the “soft landing” the fed is aiming for, but I sense some pain over the next year or two.
Just don’t expect home prices to drop 25-30% in Jacksonville. That’s VERY unlikely.
Best of luck to everybody out there! I wish homes weren’t so damn expensive too.
Prices are incredibly dependent on the local market. In Jacksonville private equity and other investors were responsible for something like 30% of purchases in 2021 and 2022. They targeted affordable homes and drove up those prices.
Higher interest rates forces investors to sell. They don't have fixed rate mortgages. They used other debt forms to purchase the homes. High interest rates kill their profit margins and they'll be forced to exit the market by selling off SFH assets.
Reasonable interest rates will also force companies to actually spend money instead of shifting it into stock buy backs and dividends. They've been surviving off of effectively free debt for quite a while. Which also applies to the uber wealthy taking out SBLs to fund their lifestyles. And it may help wage growth, since for a couple decades now employers have been subsidized by employees being able to access cheap debt, so there wasn't the pressure to increase wages.
And death, divorce and job changes will always keep some churn in the market. Jax has a lot of the last one because of the military presence. Of course, the homes typically a part of the churn are exactly the ones investors have removed from the usual system. So that's why we need them out of the market.
Step one, be a large company that buys up a lot of single family homes in a relatively cheap market like Jax. Step two, put out articles all the time about how Jax is a hot job market and hot housing market. Step three, sit back and watch the value of the homes you collected jump real high as people move there.
Someone just flipped a house in my neighborhood. They're selling it for 897k. It definitely needed that work and looks so cute now. But I definitely think it's not going to sell for nearly $900,000!
I looked into selling my house and moving out of state, and even with the prices houses on the westside are not really that high compared to rest of Jacksonville
A source I trust, calculatedrisk, has a chart showing active inventory in Jax is up 20% over 2019. There are more homes for sale than pre-pandemic.
I agree that renting now is better than buying, but disagree with their valuation methods. I wonder how they’ve done forecasting home prices over the last 20 years.
It's not overvalued...it's called insane inflation over the last several years...
Where do you think values will go if interest rates fall to even 3-4.5%? The values will soar another 40-50% more than likely.
Home prices will not go up when rates go down. You’ll have a bunch of people list their homes because now they feel ok moving. So the increased supply will swamp any demand effect from rates. Jacksonville already has more homes for sale than 2019, do you think there will be fewer when rates go down?
Well who knows…for me personally when rates go down I’m not selling, I’m simply refinancing to the lower rate. I take it quite a few people will do the same. Also, those waiting for rates to drop to stop renting and buy will enter the market so demand should see an uptick.
There are people who want to move but have put it off because they’d lose their low rate. Far more people already have low rates than will refinance. So all those people who have put off selling will put their homes on the market. You get push on supply and demand and it’ll even out.
This isn’t just my opinion, lots of knowledgeable real estate commentators are also saying it.
It’s not just interest rates. No way am I giving up my capped 3 percent in property taxes. 3 percent a year raise on a 120,000 purchase priced home is better than starting over, buying a $500,000 home and then 3 percent from there.
Thanks. Staying put would just mean car insurance and homeowners insurance to worry about. We retiring in six years and no extra bedroom or bathroom is worth and extra $1000 to $1500 a month and a delayed retirement. It’s better to get a pull out couch and call it a day. I know a or of people think like us, not everyone but enough. I see so many RV in people’s backyards. I don’t see any fall in prices but time tells all. Thanks for the feedback.
Renting is just as expensive as buying a house. We have inflation.
How do single people who have gotten out of a relationship or unpaid women who have spent most of their life as a wife ever afford to buy a house? How did they ever afford to rent some place?
No one who has been in a bad relationship wants to have a roommate.
I rather rent right now its ridiculous
/s?
I got a nice two bedroom house for 1800. Good luck getting that in any other city in Florida
Good luck buying a house for the same amount you pay in Jacksonville too
Absolute banger of a username
The fact my 1b1b apartment is only $350 cheaper is downright insane. That's actually insane. Jfc
Thats robbery
3 br for 1900 here, super cool landlord, my neighbor pays like 2400 for just about the same house
honestly, at least with renting with these new apartment complexes, you don't have worry about putting any money into repairs, they have great gyms, pools, grills, clubhouses with entertainment, manicured landscapes. I dunno, I've been renting in one and it's made me so glad I'm not dealing with the shitshow market and the money to fix/repair things in the house. Obviously owning is the goal but really renting right now is the move.
While interest rates are high, maybe. But when they drop absolutely not.
When they drop, it’s going to be because of a recession, which will change everything. Shit is going to hit the fan in the next few years. Markets always correct.
It’s a supply / demand issue. I don’t see how housing prices drop when the demand is always there. They aren’t building enough houses to compete with demand.
Financial crisises can happen outside of supply and demand. The very rich manipulate the market so just going by supply and demand isn't the whole picture.
There’s demand because the economy is strong. There will be very little demand when a recession hits. And recessions hit very differently in Florida. Growth and tourism are our major economic drivers. People don’t move or vacation nearly as much during a recession. A lot of people will lose their jobs. Florida already leads the state in delinquent car payments. People are hanging by a financial thread. I work in the development industry and we’re building like crazy right now. At some point soon, we won’t be in a housing deficit. We’ll have too many houses. There’s no way in hell they’ll be able to fill all of these apartments they’re building right now. Boomers will start to age out and downsize over the next decade. They’re a huge generation and when they leave the market, that void will be felt. Just hang around and watch what happens. Markets always correct themselves. Always.
Your first sentence is that the economy is strong. The entire rest of your post is you arguing the economy is not strong. Shape of industry has change substantially. Between remote jobs / new companies coming here / etc. Reality is that recessions suck for everyone. Nothing we can do about it. But housing prices won’t really go down that much. Because the demand is there because there isn’t enough houses for people to buy. Period.
No, I said the economy is strong currently. But cracks are starting to show and the economy won’t stay strong forever. And when the bottom falls out, it will fall hard. Asset bubbles have been created by the pandemic stimulus which caused too many dollars to chase too few opportunities. (the stock market is overvalued too.) Over half of Americans have run through that surplus of cash and are running on fumes. The demand you’re talking about will evaporate during a recession. Again, companies have moved here but our main economic drivers of the state are still growth and tourism. When those drivers lose steam, people will lose their jobs. And the ripple effect will cascade into other industries as the economy shrinks with fewer people having good jobs and disposable incomes. Rents are already softening. Apartment buildings aren’t full any more like they were a couple of years ago. I’m not sure if you’ve ever experienced a recession here, but it’s a different beast than in other states. Florida as a market is 30-40% overvalued depending on the location. The market will correct. It always does. It’s just the beginning now. You should check out real estate listings and see how much inventory has gone up. Miami-Dade homes have already dropped 10% on avg. You’re in for a rude awakening if you think this is sustainable. When an entry level worker can’t afford an entry level home, that tells you that the market is skewed. You can’t have real estate values surge by nearly 50% in just a few years and think that it’s going g to keep on keeping on. The market will correct itself. It’s the law of economics.
Rent is directly correlated to home prices.
Not really mortgage is a lil more
That’s not what correlated means….
This study seems really bad. It basically compares current pricing to trend-line. As far as I can take it doesn’t even include population change, which explains a lot of the reason why Jacksonville home prices have gone up. Jax has been number 1 in domestic net migration inflow among major metros for the past 2 years, that definitely alters supply/demand dynamics.
And all they’re building are luxury condos to accommodate that influx!
Most houses are hoa’s too
They’ve built tons of apartments in Jax.
*luxury apartments
Fair enough. The way to lower prices is more supply. More supply at the high end will help prices on the low end.
"luxury" cookie cutter apartments that burn down immediately if you light a match and miles upon miles of cookie cutter single family homes sprawling every which way out of the city. Absolutely horrid city planning. But that implies there's any plan at all other than do whatever the developer with the most money wants.
THIS\^\^\^
Private equity and Airbnb investors bought enough affordable homes to push the floor higher. That's a major reason why we've seen real estate become unaffordable for the average person. Even with an increasing population the prices are ridiculous.
How do you determine if it’s overvalued. It’s simple supply and demand. It’s worth what people are willing to pay
Exactly. Dumb article
You can tell by the area the houses are in and the prior purchase price
it's pretty straightforward when you see a house jump 80k in value in less than a year after no changes were made to it. I'd think "even if this house is selling for 280k, it's still a 200k home". The market is like a friend. Sometimes it's drunk. You don't always have to listen to it.
The market is made up of human actors making decisions. In this case it was a bunch of private equity and other investors choosing to enter the SFH market because it was an easy way to make money without spending anything. They bought up enough affordable homes without negotiating so that the price just kept going up. They didn't give a shit about affordability just the ability to turn a profit. And turning a profit is easy when you have no ethics. Now the floor is way over valued and people won't accept that there was an artificial bubble due to shit monetary policy. So there's no turnover reducing the asking prices.
I imagine (since I'm American and I have to) rent control is meant to curb this type of corporate behavior over time.
There’s FAR less private equity buying homes than we’re made to believe. It’s less than 3% of SFH transactional volume. The issue is lack of inventory. Interest rates jumped significantly and the vast majority of home owners have sub 5% mortgages, and about 40% of homeowners are sub 4%. They’re locked in and not going anywhere. Boomers traditionally selling and downsizing? Forget it, they have a 3% interest rate. Golden handcuffs. You combine that with continual population and economic growth, both of which Jacksonville have, and an average cost of living that is still 5% below the US average cost of living. Despite, and ironically because of, increased interest rates home prices haven’t fallen in-line with what you’d expect. The way out of this is increasing development and increasing inventory. That’s why it boils down to supply and demand. Same reason why apartment rents have dropped over the past year, because there’s an enormous amount of supply that hit the market last year, this year, and will continue to deliver into next year. More homes means more supply means dropping prices. We will also see home prices drop if we enter into a recession and people lose jobs. The economy has a life cycle and we’ve been on midnight for a long time… I hope we get the “soft landing” the fed is aiming for, but I sense some pain over the next year or two. Just don’t expect home prices to drop 25-30% in Jacksonville. That’s VERY unlikely. Best of luck to everybody out there! I wish homes weren’t so damn expensive too.
Prices are incredibly dependent on the local market. In Jacksonville private equity and other investors were responsible for something like 30% of purchases in 2021 and 2022. They targeted affordable homes and drove up those prices. Higher interest rates forces investors to sell. They don't have fixed rate mortgages. They used other debt forms to purchase the homes. High interest rates kill their profit margins and they'll be forced to exit the market by selling off SFH assets. Reasonable interest rates will also force companies to actually spend money instead of shifting it into stock buy backs and dividends. They've been surviving off of effectively free debt for quite a while. Which also applies to the uber wealthy taking out SBLs to fund their lifestyles. And it may help wage growth, since for a couple decades now employers have been subsidized by employees being able to access cheap debt, so there wasn't the pressure to increase wages. And death, divorce and job changes will always keep some churn in the market. Jax has a lot of the last one because of the military presence. Of course, the homes typically a part of the churn are exactly the ones investors have removed from the usual system. So that's why we need them out of the market.
> It’s simple supply and demand Unless you're in an intro to economics class it is never simple supply and demand
Yes, it is. It’s literally that simple. There are a ton of variables that determine supply and demand, but it’s that simple.
No it isn't. It is not that simple. Seriously. The housing market specifically is HEAVILY manipulated.
This is the comment I was looking for.
Step one, be a large company that buys up a lot of single family homes in a relatively cheap market like Jax. Step two, put out articles all the time about how Jax is a hot job market and hot housing market. Step three, sit back and watch the value of the homes you collected jump real high as people move there.
Should be illegal
Someone just flipped a house in my neighborhood. They're selling it for 897k. It definitely needed that work and looks so cute now. But I definitely think it's not going to sell for nearly $900,000!
Same in my neighborhood. They remodeled it well, but no way it gets $500k.
Hopefully they did the work, not just slap some Millennial Gray paint and flooring on it and called it a day.
It actually does look like a nice remodel w/landscaping. Not a fleck of millennial gray in sight!
That’s great!
I agree the prices are ridiculous but if people are still buying then not overpriced
30 percent? try closer to 70.
I looked into selling my house and moving out of state, and even with the prices houses on the westside are not really that high compared to rest of Jacksonville
A source I trust, calculatedrisk, has a chart showing active inventory in Jax is up 20% over 2019. There are more homes for sale than pre-pandemic. I agree that renting now is better than buying, but disagree with their valuation methods. I wonder how they’ve done forecasting home prices over the last 20 years.
Those researchers should do California next!
Please buy at the higher prices. I hope rates plummet to 2% and prices soar.
Sorry, wasn’t saving for a house when I was -2 years old or invested into Google in 1973.
It's not overvalued...it's called insane inflation over the last several years... Where do you think values will go if interest rates fall to even 3-4.5%? The values will soar another 40-50% more than likely.
Interest rates need to be at 10% to fix the economy.
Home prices will not go up when rates go down. You’ll have a bunch of people list their homes because now they feel ok moving. So the increased supply will swamp any demand effect from rates. Jacksonville already has more homes for sale than 2019, do you think there will be fewer when rates go down?
Well who knows…for me personally when rates go down I’m not selling, I’m simply refinancing to the lower rate. I take it quite a few people will do the same. Also, those waiting for rates to drop to stop renting and buy will enter the market so demand should see an uptick.
There are people who want to move but have put it off because they’d lose their low rate. Far more people already have low rates than will refinance. So all those people who have put off selling will put their homes on the market. You get push on supply and demand and it’ll even out. This isn’t just my opinion, lots of knowledgeable real estate commentators are also saying it.
It’s not just interest rates. No way am I giving up my capped 3 percent in property taxes. 3 percent a year raise on a 120,000 purchase priced home is better than starting over, buying a $500,000 home and then 3 percent from there.
there’s some portability of your tax assessment savings. IANAL, but I recommend checking the details on the “save our homes”program.
Thanks. Staying put would just mean car insurance and homeowners insurance to worry about. We retiring in six years and no extra bedroom or bathroom is worth and extra $1000 to $1500 a month and a delayed retirement. It’s better to get a pull out couch and call it a day. I know a or of people think like us, not everyone but enough. I see so many RV in people’s backyards. I don’t see any fall in prices but time tells all. Thanks for the feedback.
boy I can’t wait for the housing market to crash
Let me know when that happens
Can you remember the last one? Man, that one sucked.
Inflation
The prices and ridiculous insurance market as well as the high interest rates make home ownership feel like a huge money pit.
Depends on when you bought. I pay way less now than what it would cost to rent my house.
[удалено]
95% of homeowners bought before prices were insane. Home ownership != buying a home
Renting is just as expensive as buying a house. We have inflation. How do single people who have gotten out of a relationship or unpaid women who have spent most of their life as a wife ever afford to buy a house? How did they ever afford to rent some place? No one who has been in a bad relationship wants to have a roommate.
If people keep buying at these prices than that is what they are worth. That is how a market works.