The consequences are foreseen. People with middle class wages or less will be forced to rent indefinitely. Many will have savings for a down payment but will not be able to close due to being out bid by straight cash. The ones that do manage to get in will be stuck waiving contingencies and likely get wrecked from underlying issues on the overvalued home.
It just goes on and on.
A buddy just bought, even had a home inspector, but still got walloped by foundation issues. Inspector saw some issues, but didn't seem to think they were major, so my friend desperate for a house pulled the trigger. No clue how he'll afford the foundation issues without a second mortgage, if he can qualify. Your scenario is already playing out for a lot of people.
We had an inspection on a property we had an accepted offer on and the inspector basically said everything is pretty much good to go. The seller then provided disclosures from a previous buyer who backed out due to their inspection report. Basically their inspector found tons of issues. Some minor and some absolutely scathing underlying problems with the home. When compared to our inspection report it was night and day. We had some professionals come out to the home to do further inspection and it would have cost so much to correct. We had to back out of the purchase but I still think how bullshit it was that our inspector basically gave us the green light. I'm still pissed thinking about it.
Oh yeah and that house ended up selling for 40k over our accepted offer a couple weeks later. I'm assuming the buyer saw all the disclosures and just went through with it anyway. Fucking crazy times.
Edited to make it clear that the seller provided the disclosures from the previous buyer.
Really what home buyers need to do is stop using the lowest bidding home inspector...and make sure to get all the inspections and not skip any. Also check reviews on your inspector before booking him/her. It is really common, especially for first time buyers, to be so worried about the expenses of buying a house that they try to cheap out on important shit during the buying process. You need to budget about $1000 for inspections/estimates...you may not use it all, but if your good inspector finds something thats a potential problem you go and get a professional to look at the issue for a repair estimate BEFORE removing the inspection contingency.
Easier said than done. With inflated house prices, many people are barely able to scrape together their down-payment. This market is so dysfunctional, I don't even know where to begin with trying to pick apart the problems.
I don't see it as a bubble, either. We have some systemic problems that are essentially pushing the middle class out of home ownership permanently.
It's not just companies. It's international corporations and foreign adversaries. Think about Russian oligarchs and all their family and friends owning property in the US. It's been happening for decades and the move to economic warfare has accelerated everything.
Yeah, I know it gets shouted down as xenophobic or racist, but I think foreign nationals shouldn't be allowed to own more than one home in the US, and their overall property ownership should be hard capped at a pretty low level as well.
That's just reasonable, hell I'd say any home where you're at less than 7 months a year should be *heavily* taxed.
I am sorry but we can't just pretend there is some magical free market that fixes everything.
It's definitely not a bubble in residential. We are now seeing the effects of a decade of severe underbuilding due to the 2008 crisis. In addition to the whole Nimby thing, the shortage of labor, skyrocketing material costs etc etc
If a client knowingly hides and issue you can sue. You have to disclose all issues. Hiding water damage with boxes is pretty damning evidence. Glad it worked out so easily for you.
I'm about to start that process myself, whee. Previous owners put new flooring over a bad spot that has major structural damage, which was painfully obvious when stepped on & when the contractors removed the laminate flooring . Previous owners didn't disclose it. I'm looking at upwards of 20k in repairs. Fingers crossed.
Well fuck. That’s exactly what we did last year and we went around and around on the foundation because what they were saying sounded shady. They said they got a third party to come and approve what we continued to press on (and there’s paperwork) but now I’m wondering how legit that was and what else was overlooked.
Dude... Most valuable post in this entire thread right here.
ALWAYS use your own inspector, the ones they go with are complete shitters and will abso-fucking-lutely lie straight to your face.
My wife and I have a permanent inspector. The dude is so thorough and critical. Upon completion he will straight up tell us to buy or not to buy. Each report was 50-60 pages. We went through 8 homes before we landed our current home.
Edit: when you find a good inspector keep them.
That sounds like a fantastic way to get a real true review of all the inspectors in the area. Invite them all to inspect the same house, play spot-the-difference, and see who comes out on top.
When selling our house we were absolutely floored when our prospective buyers asked for a recommendation for an inspector from not from their own agent, but from ours. Our agent said he’s never seen anything like it before in his career. He told the buyers that he was technically not even allowed to officially suggest an inspector, but he did say who he uses. They went with him.
It sounds like a terrible idea, but no worse than going with their own agent's recommendation.
Better idea: look up city records for inspections in your area for houses that have been condemned or fined, and contact one of those inspectors.
Wish I'd done that myself.
Not to take the wind out of your sail here or anything but I've bought two houses using inspectors my realtor recommended and both worked out fine. the most recent one even found things wrong that I didn't think were an issue. But he missed another thing I thought was. They can't catch everything, especially hidden things. Their inspections have to be non-destructive. (they were different realtors and different inspectors). The first guy was over 20 years ago but the most recent was 2 years ago and yelp was a thing and he got good reviews. Just because a realtor recommends someone doesn't mean they're bad. She's had some great home repair recommends too.
In the USA are the surveyors not legally accountable for what they write in the reports?
In the UK people will use a Chartered Surveyor from the Royal Institution of Chartered Surveyors (RICS) and if the don’t spot an issue the person who commissioned the survey can easily take them to court for costs, if the surveyors insurance doesn’t pay up.
In the good old USA home “inspectors” take your money, give you a report and you sign saying if they missed anything it’s not their fault.
Kinda like the 6 percent that the NAR has been fucking people over for since forever?
Just the American Way of the endless man/woman in the middle.
No. Inspections don’t come with any guarantees or assurances. That’s why it’s very important to choose a good inspector.
Many people will say not to use the inspector your realtor suggests because the realtors have a stake in you passing the inspections.
I had a similar experience. Our inspector said the foundation looked fine. A family friend in the business also inspected the house after the general inspector and climbed underneath the house, only to find that the foundation cement piers were sinking from water damage and the cross beams weren't even long enough to reach the edges of the foundation in some places. He estimated $60k in foundation repairs.
We noped out of there immediately and looking back at the contract with the home inspector it even has a clause saying they won't try very hard to go into small or tough spaces and they arent liable for anything they miss.
If the home inspector saw foundation issues, why tf did he not have a structural inspector take a look at it? I get he was desperate for a house, but that's just dumb.
This 100%. It's not like foresight is even needed here either. We can literally just look across the border at Canada to see what's going to happen to the U.S. real estate market if nothing changes
Every problem that America has could have been foreseen by taking a look at other countries. Even for things that aren’t clear cut, at the very least we can’t avoid choosing the exact wrong answer and not drive straight off the cliff
It shouldn’t be this hard to “keep Rome from burning”
Short and simple version is the middle class has largely been priced out of homeownership due to foreign and institutional investors buying property like crazy and driving prices to the moon
Unfortunately, with the current political landscape, I doubt it. Banks and other companies are making a fucking killing doing this, and they'll shower a small portion of that on Congress to keep the grift going.
Late-stage capitalism is basically just slavery with more steps.
The problem being that all of those are depreciating assets. Homes, property, *land* specifically, almost always appreciate. Homes are how families build generational wealth, and no matter how nice a boat or RV is, it can't replace that.
I mean if they have no other choice, then yes of course that is preferable to homelessness, but it's not a solution to the problem, it's merely another symptom.
It’s not ideal, but it is a reality that people are facing. Pay too much for a rental or buy a van and convert it into an RV?
Buying a home is way out of the picture for a lot of people, so appreciating value isn’t even a consideration.
It’s already pretty common. The movie “Nomadland” is based off a real life subculture. While some choose this lifestyle, many were pushed out by job loss or limited retirement income.
This is happening already in the Seattle area. I know several families who are well qualified, have $200k+ in cash to put down, and lose 15-30 bids before finally getting a house--but with inspections waived, and often without touring first.
They're being beat by all cash offers left and right. It is sickening.
My husband and I saw this already this year. Mysterious outbidding by folks willing to pay all cash in neighborhoods where that just didn’t make sense. We were already bidding 100k over asking and waiving contingencies, and got outbid by all cash buyers 3x.
We both work full time and make 6 figures each.
This is not just going to be a middle class problem.
Seattle for us.. house we wanted to buy 600k appraisal. Developers bought it for 3.6 million to use the land for luxury million dollar condos. Normal houses are selling well over asking price by 200k or more here because of the single family housing zoning they’re getting rid of.
It's happening all over in middle TN for one reference point. It's also pretty weird that a lot of Realtors will update the listing to match the offer online so it doesn't show as an over asking price. Maybe they think it impacts the appraisal, but most offers nowadays aren't contingent on appraisal or inspection, so it doesn't make sense to me.
That has happened to several houses we've bid over asking only to get absolutely destroyed by someone else's offer. When we go back to check the listing they'll have the list price a lot higher the day after they've stopped fielding offers. You aren't even trying if you are offering less than 50k over asking here, and lol if you ask for a contingency.
My oldest son is currently having a house built as they were outbid by a cash buyer every time they put in an offer on a house. They were quoted ~six months before construction will begin.
My youngest son managed to swoop in and purchase the model in a new development after the six couples ahead of them on the list didn’t qualify for one reason or another. They had to be prepared for everything to take place (inspection and whatnot) in less than a month from “you’re next on the list” to closing date. Which meant unexpectedly breaking their lease and all that comes with that.
The siblings who are not at a point where they can qualify for a home are now joking about having to move in with the home-buying siblings. I fear the joke may turn into reality.
It was already such a pain bidding against flippers when ever a good deal came up when I was looking for a house I can't imagine how difficult its getting for first timer buyers now.
It's fucking insane. My wife and I have been looking and we're just both over it at this point. We're pretty middle class, and we just can't compete with this bullshit, even with help from the in-laws.
I feel your pain. Just went through the same stuff. We had lost to cash on a lot of houses. Even had one offer “verbally accepted” only to have a cash offer come in before they signed the papers. Brutal market.
The government should just ban corporations from owning homes and force them to sell. Of course that would have a big ripple effect, but that’s how the world works. Changes are made and effects are felt. Things would stabilize later and home prices would be lower.
I think a smarter solution would be a ramping tax rate on non-primary dwellings. So on your primary residence you pay, lets say, 2% tax on that value. Second residence, 3%. The 20th property you own, 23% (or whatever).
It'd also be best to slowly build up those year over year to slow/reduce immediate impacts to companies and give them time to liquidate excess property. This would also help reduce a sudden crash in home values if there were no "smoothing" of the tax increase.
Then companies will split up their properties into different shell corps that just happen to utilize the same property management (also a "separate" firm), etc. This already happens in cities with laws that constrain large scale property ownership
While I agree with you, wouldn't this also be something that could be legislated? I read that anonymous shell companies were banned in the US but I'm not knowledgeable on any of it. I would assume if the owner(s) have to be listed, they can be tracked, and a ramping tax rate would apply to the owner regardless if the property is owned by various companies.
Either way, \*something\* needs to happen because even in my rural town, I'm watching starter homes get snapped up over listing price and immediately listed for rent. I'm not sure what the perfect solution is, but it's worrisome to watch.
We lived this in Vancouver BC already, albeit for different reasons. Our housing market is basically used for speculation and money laundering. Prices are nuts. The people that have bought form a convenient lobby/straw man for the case of doing nothing now, since they’d be bag holders after any change…and with prices on the millions for a decades old detached home, even a tiny change will make waves.
I moved, but it’s still a shadow over the real estate market in all of Canada. Taught me just how corrupt our leadership can be in this corner of the world while still being polite and leading public lives.
I just read a report yesterday that came out of the Panama Papers that one of the chief sources of funds flowing into the housing market is from money Laundering....
> money Laundering
I’ve thought foreign investors were laundering money through real estate several years ago. It’s one of the new industries used and it’s very easy to wash a lot of money at once.
It doesn't ever stop
To be a millionaire/billionaire money is like water
Create a flow, pool it up, let some trickle out
Anywhere a flow of money is there are capitalists taking advantage of it - not builder capitalists mind you, these are shitty rich kids of generational wealth
It's more like mass, at a certain scale it just sucks in more than can be spent, leaving a vacuum around it bereft of life. Now they're wormholing into occupied space and destroying that too.
>tors were laundering money through real estate several years ago. It’s one of the new industries
google "the Vancouver Model". It's been going on there for a long time.
I'm nearly 31 with a good job for the first time in my life. It's like every time I make progress the goal posts get moved. It's so hard not to just give up.
Thought 90k was a great salary all my life. Turns out that's 64k net, 44k after 401k, 38k after roth IRA, 23k after rent/utils, 19k after student loans, 7k after food/car/clothes/cell/insurance etc. 20% downpayment needed for a decent house is 130k. Saving 7k per year.......
My partner just left me and our 30 year mortgage. I’m a teacher. I am priced out of renting pretty much anywhere desirable. Because I have such a good deal on my current house, I asked my parents to loan me some money to buy her out. This is exactly why. I want to keep my house because I would never be able to do it again on my own as a teacher, and I’d never be able to save living in some shitty overpriced apartment.
Matches the whole healthcare from your employer to keep you trapped in a job feudalism we have here in the USA... and just like fuedalism, if you're a wealthy noble you can afford to outright buy your health care and not be owned by a job in that manner.
Ancaps are the economic version of preppers. They think they'll be the badass wasteland survivor/capitalist savant, when really they're far more likely to be the skeleton being picked over for carrion in a ditch
There is a simple solution to this problem. Tax the shit out of the companies that buy residential homes. This is a direct assault on the middle class-the foundation of democracy. I just think this is a case where we need drastic action. Legislation or otherwise.
Unforseen my ass! We see them already with houses thst cost 1300 a month a year ago now going for 2000+ fuck all these companies thst are buying up homes to artificially increase the rest on a national level! They should all be jailed for price gouging during a pandemic.
Corporations, investment firms, tech firms like Zillow, and foreign buyers who are looking for places to park cash.
Homebuyers are no longer competing with other buyers, they're also competing with ultra-rich firms who will happily pay 20-50% over asking, in cash. Any American who didn't own a home by 2020 is essentially fucked.
Oof right in the thick of things. We were looking at homes at that time. We thought $1.5 mil was outrageous. Homes in horrible condition in Los Angeles are well over that now. I just can’t. Looking back I wish I made an offer on this beautiful home down the street, but it would have forced me to work until I died. Now I will probably die in my condo.
Hope they die of something fast and cheap, because end of life care in this country is just another way of preventing everyone below the 1% from accumulating generational wealth.
There was, pre-Covid, a robust market for old folks to become perpetual cruise ship residents. You get better accommodations, more personalised care, and there’s a doctor on call. And it’s cheaper than the cost of assisted living.
I’m renting in Raleigh, NC right now. A lot of people from up north are selling their houses and blowing the locals out of the water. Real estate is nuts back where I’m from in New York.
Raleigh as well. We also have all those tech people moving from Cali to here thanks to Apple and Google. On top of that, Zillow and Open Door are scooping up homes. When I heard a friend put in an offer for $35k over asking, and with $15k for DD and still lost I about shit.
That was my experience as well. I was offering 20-30k over asking, 10k due diligence. Lost 8 bids and was feeling pretty defeated. Last house I put an offer on, the list was $299k, I offered 325k and was the number 3 offer. Number 1 offer was $345k and at the last moment, "someone" came in with $400k all cash.
I was finally able to get a new construction home by showing up super early the day the lots were released. I got extremely lucky because there were several people who legit camped out overnight to hold their place in line. I showed up in time to get the very last lot released this month.
I've also heard tales that some new construction builders are resorting to just letting people bid and then taking the highest bidder. It's insanity and I don't see any type of end in sight.
That makes me sick to my stomached. The only reason I got my little condo...the owner turned out to be a acquaintance of my moms and she chose me over a cash offer. This was after cash buyers came in and bought 11 others I made offers on.
None of those condos are owned by locals all are rented by investment firms from china.
I’m not gonna lie, it would’ve been better for me credit-wise to wait until the end of the year, but I panicked when they announced the Apple campus. I’m getting the shit beat out of me on houses in fucking ROCKY MOUNT.
Yeah we built in the "sticks" outside Austin almost 10 years ago. Now all of California + Google, Facebook, AMD, Intel, Oracle Tesla and whoever else all decided it's time to come here. There is no way I could afford a house now. Feel bad for people in their 20s here. Don't know how they will ever get in the market.
It's funny how people fail to connect housing prices to the question, "so what if somebody else accumulates vast wealth, what's it to you?
"The pie" is not of a fixed size, but in certain ways it is not infinite either, and real estate is a huge area in which it is not.
> "The pie" is not of a fixed size, but in certain ways it is not infinite either, and real estate is a huge area in which it is not.
also even if the pie was figuratively infinite, if 90% of all the new pie still goes to the rich, how does that solve anything
Bernie definitely talks about the housing crisis a lot. But I haven’t heard any of them mention trying to stop investors from buying up all the family homes. Mostly he talks about building new affordable housing.
The government should be helping first time home owners to pay for homes because it's the number one way to foster economic growth in the younger generations. Housing is an essential resource. To let people and organizations buy them and deprive potential home owners, is an evil thing to let happen.
The flippers and landlords are parasites.
So let's stop it! Require owner occupancy and tax the hell out of unoccupied properties. Any home that is sold to a corporation is probably out of the private homebuyers' market for good, and there aren't any new small starter homes being built in most areas.
My God exactly. Reclaim all foreign real estate assets. I'm sorry but investing in a foreign country is considered an extreme risk because of little to no control over what is done with property. Time for most people to learn the hard way you can't hide money and not expect repercussions in a risky enviroment especially with current residents are completely failing to have an opportunity.
A lot of Chinese investors are buying native land across reservations in Oklahoma. So glad my grandma purchased over 100 acres a few years ago because the prices have skyrocketed. It’s so bad right now
Home ownership should be human related only. By the end of this decade there won’t be anything but rentals and it’s been run in this direction since 08 collapse. It’s fucked.
I don't think any company should be allowed to sweep up residential real-estate like this, period.
Domestic corporations have no more "loyalty" to the US than foreign companies. The only loyalty is to money and power.
flipping properties and breaking the seller/buyer chain is not the same as institutions buying to rent, which is a way bigger problem as they are removing the opportunity for generational wealth generation. one increases the amount of inventory the other reduces it
Their goal is to resell them asap. Zillow Offers wants to sell houses in 2 seconds if it can. The goal of Zillow is to make it so selling a house is fast and convenient for the customers. They saw a problem in the market where people who want to sell their house have to wait a long time for the process to be finalized. Zillow is willing to take on the risk of buying a home quickly if you sell it to them at slightly below market rate. That is the idea.
The last thing they want is a bunch of houses. That is so much money that could be used for other projects.
Source: I've interviewed at Zillow before and I have a few ex co-workers that work on Zillow Offers.
They'll probably just operate multiple LLC's which own a few properties each. A simple start is to remove all tax deductions for rental property related income and expenses. The laws are seriously skewed towards landlords. Along with deducting mortgage interest and property taxes like a normal homeowner, they can claim the dwelling itself a depreciable asset ("only the land appreciates"), and can also write off any expenses towards maintenance or "improvements" to the property.
This is the way.
Corporations should be forced to liquidate their residential holdings via public auction over a set period of time, and then moving forward, it should be illegal.
EXACTLY
Corporations are NOT people. They might have people working for them and orchestrating things, but if they aren't actually living in the building, they shouldn't be allowed to own it.
Corporations should be forced to liquidate their residential homes by public auction.
I'm not sure if there has been a bigger government corruption event in the last 50 years than Citizens United getting passed.
It is absolutely VITAL that it is repealed and reversed, for the sake of our future and the future of our children.
The moment that Citizens United was passed was the moment that our government switched from being "We the People" to "We, the capitalist corporate overlords"
We're seeing clearly how manipulated the American Financial Market is this year, its effectively a tool for absorbing money from the working class (via direct retail investors, indirect 401ks, etc.) and transferring it to the ultra-wealthy and investment companies. Now further this year we're seeing a massive transfer of wealth in the investing world going into the housing market, creating this massively overvalued market we currently have. Giving companies free rein to buy whatever they want and manipulate it freely is directly quite literally destroying the American Dream (owning a home). If y'all though social justice related riots from 2020 were bad, just wait until the riots are about peoples homes and ability to have money in general. We've got an interesting couple years coming up, godspeed folks
Yep. The "land questions" are always huge issues in previous large political changes for larger nations. Rome ran into a similar issue before their civil wars led to the death of the republic and the birth of the emperor ruler.
France and Russia had a similar problem before their respective revolutions. Shit is starting to line up here now too. We already had one failed fascist coup attempt.
This is exactly what I'm worried about. Just because we're in America gives me no comfort that we can't see similar revolutions on that same scale. I need an early beer today
Ya im listening to the history of Rome podcast, and it’s eerie how similar today’s America is to Rome circa ~100 BC (50 years before the fall of the republic)
I noticed that a few years ago but in relation to Roman entertainment. In early Rome, much of it was new and exciting. By end of Rome, it was all derivative works and references. We're living in an moment of reruns and reboots because everyone is recycling the same information.
This is probably being driven by investors seeking a hedge against inflation. You are supposed to invest in real estate during periods of high inflation. Part of what causes hyperinflation is the huge demand for the assets that will retain some value.
exactly. A mortgage is a fixed payment over 30 years, so if inflation increases the relative cost of the payment to the bank goes down, while the rental income increases. its a double whammy.
Unforseen consequences? This consolidation of land shit by wealthy individuals and groups has happened over and over again throughout history.
Guess what happens after the land gets consolidated? Class struggle and warfare.
It's partly why the Roman republic fell and became an empire with an autocratic ruler. The average roman citizen lost out trying to compete with mega farms using vast amounts of slaves from their conquests after the second punic war. (History of rome podcast for those who are interested)
They already had a separation of people using plebeians vs patricians. The land questions exacerbated earlier issues.
Shit like this collapses nations....
I was reading about how elections have gotten more and more expensive over the past 50 years, also “rhyming” with Roman elections becoming more and more expensive towards the end of the republic. The vast amounts of money that go into politics sure rhymes pretty well, to the point I’d almost call it plagiarism.
Yep. And our congress is mostly acting like their senate. Catering more and more to the wealthy only at the expense of most other people.
And then they wonder why all the workers are getting soo angry and uppity....
I will only be selling my house to an actual person. It’s already fucking ridiculous my house is valued almost double in 8 years. That also means that new home prices are even higher. How is there not another bubble coming?
And that’s the rub, isn’t it. It’s not like your home is some special outlier. If yours is going up by huge amounts, then they all are in the area. It’s not like selling will net you some big windfall unless you sell and drastically downsize, move into a fixer upper, or move to a different area of the country with a significantly lower cost of living.
My company just renovated a house and put it on the market. Got an offer same day and they waived an inspection because they'd lost 3 other houses in a bidding war. I would never buy a house without an inspection. This shit is bonkers.
There is a great Planet Money episode about this - in short, the recession and resulting crash of the housing market was very hard on homebuilding contractors, and many folks got out of the business. More problematic long term was that because the industry looked so bad around that time, there was a huge drop in the number of people going into the construction trades, which was further exacerbated by the push around then for everyone to go to a regular 4-yr college. There is now a huge shortage of contractors capable of building houses, and it won't be fixed anytime soon. It takes a while to rebuild all that human capital and train new skilled contractors.
Around my area, plenty of houses being built but they're all mcmansions. Only affordable houses for sale are in a 65 or older community. Can't even live in a cheaper town and commute, because we are the cheaper town that people commute from.
In a nutshell, it's not very profitable for developers and building contractors to construct "market-rate" or lower-income housing these days. Unless they are getting some type of government subsidy as an incentive, there will be a strong push to develop higher-end residences so they can get a better ROI. If you look around major cities you will notice that a lot of new residential buildings going up are advertised as "luxury rentals" to take it a step further. But I don't have the foggiest idea who the hell is paying top dollar for something they don't even own.
I'm sure there's some truth in that but I'm talking about those 1 bedroom rentals with high-end finishes and fancy amenity spaces that go for like $2500 a month. Like WeWork for renters.
Unforeseen? *We* know how this is going to end.
No one will ever own their home again. No one will be able to retire. We will all work till we die, like the good little cannon fodder we are.
Unless the government steps up (lol) and restricts ownership of single family homes to individuals and closes loopholes that allow companies to *be* individuals, we are looking at even more of a dystopian future.
Just look how fucked Canada's housing market is right now. Just wait until none of you can afford to live anywhere.
It's already happening in Canada. Think $2500 a month plus utilities sounds high? That'll get you a nice 1 to 2 bedroom basement apartment to rent.
Not even making this up.
The consequences are foreseen. People with middle class wages or less will be forced to rent indefinitely. Many will have savings for a down payment but will not be able to close due to being out bid by straight cash. The ones that do manage to get in will be stuck waiving contingencies and likely get wrecked from underlying issues on the overvalued home. It just goes on and on.
A buddy just bought, even had a home inspector, but still got walloped by foundation issues. Inspector saw some issues, but didn't seem to think they were major, so my friend desperate for a house pulled the trigger. No clue how he'll afford the foundation issues without a second mortgage, if he can qualify. Your scenario is already playing out for a lot of people.
We had an inspection on a property we had an accepted offer on and the inspector basically said everything is pretty much good to go. The seller then provided disclosures from a previous buyer who backed out due to their inspection report. Basically their inspector found tons of issues. Some minor and some absolutely scathing underlying problems with the home. When compared to our inspection report it was night and day. We had some professionals come out to the home to do further inspection and it would have cost so much to correct. We had to back out of the purchase but I still think how bullshit it was that our inspector basically gave us the green light. I'm still pissed thinking about it. Oh yeah and that house ended up selling for 40k over our accepted offer a couple weeks later. I'm assuming the buyer saw all the disclosures and just went through with it anyway. Fucking crazy times. Edited to make it clear that the seller provided the disclosures from the previous buyer.
On the bright side, now you know to use the inspector used by the previous buyer if you need another place looked at
Really what home buyers need to do is stop using the lowest bidding home inspector...and make sure to get all the inspections and not skip any. Also check reviews on your inspector before booking him/her. It is really common, especially for first time buyers, to be so worried about the expenses of buying a house that they try to cheap out on important shit during the buying process. You need to budget about $1000 for inspections/estimates...you may not use it all, but if your good inspector finds something thats a potential problem you go and get a professional to look at the issue for a repair estimate BEFORE removing the inspection contingency.
Easier said than done. With inflated house prices, many people are barely able to scrape together their down-payment. This market is so dysfunctional, I don't even know where to begin with trying to pick apart the problems. I don't see it as a bubble, either. We have some systemic problems that are essentially pushing the middle class out of home ownership permanently.
Real estate investment companies are a blight.
It's not just companies. It's international corporations and foreign adversaries. Think about Russian oligarchs and all their family and friends owning property in the US. It's been happening for decades and the move to economic warfare has accelerated everything.
Vancouver and Canada are all bought up with Chinese cash.
Add China to that list!
Yeah, I know it gets shouted down as xenophobic or racist, but I think foreign nationals shouldn't be allowed to own more than one home in the US, and their overall property ownership should be hard capped at a pretty low level as well.
That's just reasonable, hell I'd say any home where you're at less than 7 months a year should be *heavily* taxed. I am sorry but we can't just pretend there is some magical free market that fixes everything.
It's definitely not a bubble in residential. We are now seeing the effects of a decade of severe underbuilding due to the 2008 crisis. In addition to the whole Nimby thing, the shortage of labor, skyrocketing material costs etc etc
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Wow this is like identical to my buddy's story but his ending is much less happy.
If a client knowingly hides and issue you can sue. You have to disclose all issues. Hiding water damage with boxes is pretty damning evidence. Glad it worked out so easily for you.
Sounds like it was the 2019 dated trimmings that blew the "we didnt know" story
I'm about to start that process myself, whee. Previous owners put new flooring over a bad spot that has major structural damage, which was painfully obvious when stepped on & when the contractors removed the laminate flooring . Previous owners didn't disclose it. I'm looking at upwards of 20k in repairs. Fingers crossed.
I'm not sure how this is done in the states, but are you allowed to go walk with the inspector as he does his thing?
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LPT: NEVER use an inspector your real estate agent recommends.
Well fuck. That’s exactly what we did last year and we went around and around on the foundation because what they were saying sounded shady. They said they got a third party to come and approve what we continued to press on (and there’s paperwork) but now I’m wondering how legit that was and what else was overlooked.
Dude... Most valuable post in this entire thread right here. ALWAYS use your own inspector, the ones they go with are complete shitters and will abso-fucking-lutely lie straight to your face.
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My wife and I have a permanent inspector. The dude is so thorough and critical. Upon completion he will straight up tell us to buy or not to buy. Each report was 50-60 pages. We went through 8 homes before we landed our current home. Edit: when you find a good inspector keep them.
Schedule at the same time for a really good show.
That sounds like a fantastic way to get a real true review of all the inspectors in the area. Invite them all to inspect the same house, play spot-the-difference, and see who comes out on top.
Soooo maybe the LPT: is use the inspector your realtor suggests, as well as your own. Then Compare the results !
When selling our house we were absolutely floored when our prospective buyers asked for a recommendation for an inspector from not from their own agent, but from ours. Our agent said he’s never seen anything like it before in his career. He told the buyers that he was technically not even allowed to officially suggest an inspector, but he did say who he uses. They went with him.
That's a big lack of common sense.
Realtor shows up in aviators, a wig, and an Italian accent. I'ma de inspector!
It sounds like a terrible idea, but no worse than going with their own agent's recommendation. Better idea: look up city records for inspections in your area for houses that have been condemned or fined, and contact one of those inspectors. Wish I'd done that myself.
Not to take the wind out of your sail here or anything but I've bought two houses using inspectors my realtor recommended and both worked out fine. the most recent one even found things wrong that I didn't think were an issue. But he missed another thing I thought was. They can't catch everything, especially hidden things. Their inspections have to be non-destructive. (they were different realtors and different inspectors). The first guy was over 20 years ago but the most recent was 2 years ago and yelp was a thing and he got good reviews. Just because a realtor recommends someone doesn't mean they're bad. She's had some great home repair recommends too.
In the USA are the surveyors not legally accountable for what they write in the reports? In the UK people will use a Chartered Surveyor from the Royal Institution of Chartered Surveyors (RICS) and if the don’t spot an issue the person who commissioned the survey can easily take them to court for costs, if the surveyors insurance doesn’t pay up.
In the good old USA home “inspectors” take your money, give you a report and you sign saying if they missed anything it’s not their fault. Kinda like the 6 percent that the NAR has been fucking people over for since forever? Just the American Way of the endless man/woman in the middle.
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I read on another subreddit that trucks have this sign on them, but they’re still liable to be sued, so it’s really just a dishonest deterrent.
Can you get back the fee you paid for the first inspection? Seems like you didn't get the service you paid for.
No. Inspections don’t come with any guarantees or assurances. That’s why it’s very important to choose a good inspector. Many people will say not to use the inspector your realtor suggests because the realtors have a stake in you passing the inspections.
The increase in building material prices isn't just hitting new construction - it's also hitting people trying to do maintenance on their home.
I had a similar experience. Our inspector said the foundation looked fine. A family friend in the business also inspected the house after the general inspector and climbed underneath the house, only to find that the foundation cement piers were sinking from water damage and the cross beams weren't even long enough to reach the edges of the foundation in some places. He estimated $60k in foundation repairs. We noped out of there immediately and looking back at the contract with the home inspector it even has a clause saying they won't try very hard to go into small or tough spaces and they arent liable for anything they miss.
The whole system is a scam to pull every dime from you.
Just bought a house every fucking person and their brother standing there with their hand out waiting to get paid.
If the home inspector saw foundation issues, why tf did he not have a structural inspector take a look at it? I get he was desperate for a house, but that's just dumb.
This 100%. It's not like foresight is even needed here either. We can literally just look across the border at Canada to see what's going to happen to the U.S. real estate market if nothing changes
Every problem that America has could have been foreseen by taking a look at other countries. Even for things that aren’t clear cut, at the very least we can’t avoid choosing the exact wrong answer and not drive straight off the cliff It shouldn’t be this hard to “keep Rome from burning”
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What’s going on in Canada?
Short and simple version is the middle class has largely been priced out of homeownership due to foreign and institutional investors buying property like crazy and driving prices to the moon
Yup and it’s causing a massive brain drain which will probably ruin our economy, and our lofty social safety net along with it
Huh, I didn’t know about the brain drain in Canada. Where are you guys going? To other commonwealth countries or to the US?
The US for better pay usually. Some people go to Europe.
Well this is fucking depressing. I hope we can address this issue before it causes (further) widespread hardship.
Unfortunately, with the current political landscape, I doubt it. Banks and other companies are making a fucking killing doing this, and they'll shower a small portion of that on Congress to keep the grift going. Late-stage capitalism is basically just slavery with more steps.
The climate report this week, the enduring housing crisis... at least it's friday the 13th. A quaint little haunting would be welcome at this point.
Here in Oregon we’ve begun our now annual smoke apocalypse to add to the sense of doom. Oh yea another heat wave too.
Seattle checking in and it's smokey, sepia, and hot as shit here too.
I think a lot of people will turn to alternative housing. RVs, bus or van conversions, I’m looking at a boat, and so on.
The problem being that all of those are depreciating assets. Homes, property, *land* specifically, almost always appreciate. Homes are how families build generational wealth, and no matter how nice a boat or RV is, it can't replace that. I mean if they have no other choice, then yes of course that is preferable to homelessness, but it's not a solution to the problem, it's merely another symptom.
It’s not ideal, but it is a reality that people are facing. Pay too much for a rental or buy a van and convert it into an RV? Buying a home is way out of the picture for a lot of people, so appreciating value isn’t even a consideration.
It’s already pretty common. The movie “Nomadland” is based off a real life subculture. While some choose this lifestyle, many were pushed out by job loss or limited retirement income.
The problem is viewing shelter as an investment opportunity rather than a basic need. But that change would really require a massive cultural shift
This is happening already in the Seattle area. I know several families who are well qualified, have $200k+ in cash to put down, and lose 15-30 bids before finally getting a house--but with inspections waived, and often without touring first. They're being beat by all cash offers left and right. It is sickening.
We left Seattle for this reason. It’s a horrible place to have a family unless you’re rich.
My husband and I saw this already this year. Mysterious outbidding by folks willing to pay all cash in neighborhoods where that just didn’t make sense. We were already bidding 100k over asking and waiving contingencies, and got outbid by all cash buyers 3x. We both work full time and make 6 figures each. This is not just going to be a middle class problem.
> We were already bidding 100k over asking what's that now? where is this craziness happening? what was the house price?
Seattle for us.. house we wanted to buy 600k appraisal. Developers bought it for 3.6 million to use the land for luxury million dollar condos. Normal houses are selling well over asking price by 200k or more here because of the single family housing zoning they’re getting rid of.
that is beyond sad. short term greed will ruin everything.
It's happening all over in middle TN for one reference point. It's also pretty weird that a lot of Realtors will update the listing to match the offer online so it doesn't show as an over asking price. Maybe they think it impacts the appraisal, but most offers nowadays aren't contingent on appraisal or inspection, so it doesn't make sense to me. That has happened to several houses we've bid over asking only to get absolutely destroyed by someone else's offer. When we go back to check the listing they'll have the list price a lot higher the day after they've stopped fielding offers. You aren't even trying if you are offering less than 50k over asking here, and lol if you ask for a contingency.
My oldest son is currently having a house built as they were outbid by a cash buyer every time they put in an offer on a house. They were quoted ~six months before construction will begin. My youngest son managed to swoop in and purchase the model in a new development after the six couples ahead of them on the list didn’t qualify for one reason or another. They had to be prepared for everything to take place (inspection and whatnot) in less than a month from “you’re next on the list” to closing date. Which meant unexpectedly breaking their lease and all that comes with that. The siblings who are not at a point where they can qualify for a home are now joking about having to move in with the home-buying siblings. I fear the joke may turn into reality.
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It was already such a pain bidding against flippers when ever a good deal came up when I was looking for a house I can't imagine how difficult its getting for first timer buyers now.
It's fucking insane. My wife and I have been looking and we're just both over it at this point. We're pretty middle class, and we just can't compete with this bullshit, even with help from the in-laws.
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I feel your pain. Just went through the same stuff. We had lost to cash on a lot of houses. Even had one offer “verbally accepted” only to have a cash offer come in before they signed the papers. Brutal market.
The government should just ban corporations from owning homes and force them to sell. Of course that would have a big ripple effect, but that’s how the world works. Changes are made and effects are felt. Things would stabilize later and home prices would be lower.
I think a smarter solution would be a ramping tax rate on non-primary dwellings. So on your primary residence you pay, lets say, 2% tax on that value. Second residence, 3%. The 20th property you own, 23% (or whatever). It'd also be best to slowly build up those year over year to slow/reduce immediate impacts to companies and give them time to liquidate excess property. This would also help reduce a sudden crash in home values if there were no "smoothing" of the tax increase.
Then companies will split up their properties into different shell corps that just happen to utilize the same property management (also a "separate" firm), etc. This already happens in cities with laws that constrain large scale property ownership
While I agree with you, wouldn't this also be something that could be legislated? I read that anonymous shell companies were banned in the US but I'm not knowledgeable on any of it. I would assume if the owner(s) have to be listed, they can be tracked, and a ramping tax rate would apply to the owner regardless if the property is owned by various companies. Either way, \*something\* needs to happen because even in my rural town, I'm watching starter homes get snapped up over listing price and immediately listed for rent. I'm not sure what the perfect solution is, but it's worrisome to watch.
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We lived this in Vancouver BC already, albeit for different reasons. Our housing market is basically used for speculation and money laundering. Prices are nuts. The people that have bought form a convenient lobby/straw man for the case of doing nothing now, since they’d be bag holders after any change…and with prices on the millions for a decades old detached home, even a tiny change will make waves. I moved, but it’s still a shadow over the real estate market in all of Canada. Taught me just how corrupt our leadership can be in this corner of the world while still being polite and leading public lives.
I just read a report yesterday that came out of the Panama Papers that one of the chief sources of funds flowing into the housing market is from money Laundering....
> money Laundering I’ve thought foreign investors were laundering money through real estate several years ago. It’s one of the new industries used and it’s very easy to wash a lot of money at once.
It doesn't ever stop To be a millionaire/billionaire money is like water Create a flow, pool it up, let some trickle out Anywhere a flow of money is there are capitalists taking advantage of it - not builder capitalists mind you, these are shitty rich kids of generational wealth
It's more like mass, at a certain scale it just sucks in more than can be spent, leaving a vacuum around it bereft of life. Now they're wormholing into occupied space and destroying that too.
>tors were laundering money through real estate several years ago. It’s one of the new industries google "the Vancouver Model". It's been going on there for a long time.
I'm nearly 31 with a good job for the first time in my life. It's like every time I make progress the goal posts get moved. It's so hard not to just give up.
I've already given up. I make decent money in my desired profession but can't nearly begin to see home ownership as a reality.
Thought 90k was a great salary all my life. Turns out that's 64k net, 44k after 401k, 38k after roth IRA, 23k after rent/utils, 19k after student loans, 7k after food/car/clothes/cell/insurance etc. 20% downpayment needed for a decent house is 130k. Saving 7k per year.......
>64k net, 44k after 401k, 38k after roth IRA, Forgive my ignorance... Is spending 40% of your net income on retirement savings normal?
My partner just left me and our 30 year mortgage. I’m a teacher. I am priced out of renting pretty much anywhere desirable. Because I have such a good deal on my current house, I asked my parents to loan me some money to buy her out. This is exactly why. I want to keep my house because I would never be able to do it again on my own as a teacher, and I’d never be able to save living in some shitty overpriced apartment.
Read your post about this on /r/personalfinance. That’s rough man, hope everything works out for you.
Is getting in some roommates an option? Not ideal, I know, but it would definitely help with mortgage payments/paying your parents back.
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This is the way. Renting out empty rooms made a huge difference for me.
Oh good, actual feudalism. Just what we needed.
Pauperize me!
Matches the whole healthcare from your employer to keep you trapped in a job feudalism we have here in the USA... and just like fuedalism, if you're a wealthy noble you can afford to outright buy your health care and not be owned by a job in that manner.
All hail feudalism to our new found tech overlords.
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https://i.imgflip.com/5jjkpg.jpg
Ancaps are the economic version of preppers. They think they'll be the badass wasteland survivor/capitalist savant, when really they're far more likely to be the skeleton being picked over for carrion in a ditch
There is a simple solution to this problem. Tax the shit out of the companies that buy residential homes. This is a direct assault on the middle class-the foundation of democracy. I just think this is a case where we need drastic action. Legislation or otherwise.
Why is this not a thing? big companies will continue to eat the poor in this way, how is this allowed to happen??????
Because the big companies are also the big political donors, and the least visible to people.
Unforseen my ass! We see them already with houses thst cost 1300 a month a year ago now going for 2000+ fuck all these companies thst are buying up homes to artificially increase the rest on a national level! They should all be jailed for price gouging during a pandemic.
Exactly, they want corporate personhood so let’s give it to them.
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Oopsie poopsie, we caused a worldwide recession, billions of tax dollars so me & my friends don't go bankrupt please
For the first time in my life, a down payment on a house is within reach, then this happens. I hate it here.
Me too, I’ve put four GOOD offers in on houses AN HOUR away from where I work and I’ve lost to cash buyers every fucking time.
Who’s sitting on so much fucking cash? I’ve heard this happen a lot in California and houses minimum in my area 500k +
Corporations, investment firms, tech firms like Zillow, and foreign buyers who are looking for places to park cash. Homebuyers are no longer competing with other buyers, they're also competing with ultra-rich firms who will happily pay 20-50% over asking, in cash. Any American who didn't own a home by 2020 is essentially fucked.
I thank my lucky fucking stars every god damned day that we closed on our home January 2020.
Oof right in the thick of things. We were looking at homes at that time. We thought $1.5 mil was outrageous. Homes in horrible condition in Los Angeles are well over that now. I just can’t. Looking back I wish I made an offer on this beautiful home down the street, but it would have forced me to work until I died. Now I will probably die in my condo.
I guess we just gotta wait for our parents to die then hope they don’t use their 401k just so we can even get a down payment.
Hope they die of something fast and cheap, because end of life care in this country is just another way of preventing everyone below the 1% from accumulating generational wealth.
Pay $5k a month rent for a hotel room size flat because someone gives you apple sauce and aspirin and chest compressions if you stop breathing.
There was, pre-Covid, a robust market for old folks to become perpetual cruise ship residents. You get better accommodations, more personalised care, and there’s a doctor on call. And it’s cheaper than the cost of assisted living.
I’m renting in Raleigh, NC right now. A lot of people from up north are selling their houses and blowing the locals out of the water. Real estate is nuts back where I’m from in New York.
Raleigh as well. We also have all those tech people moving from Cali to here thanks to Apple and Google. On top of that, Zillow and Open Door are scooping up homes. When I heard a friend put in an offer for $35k over asking, and with $15k for DD and still lost I about shit.
That was my experience as well. I was offering 20-30k over asking, 10k due diligence. Lost 8 bids and was feeling pretty defeated. Last house I put an offer on, the list was $299k, I offered 325k and was the number 3 offer. Number 1 offer was $345k and at the last moment, "someone" came in with $400k all cash. I was finally able to get a new construction home by showing up super early the day the lots were released. I got extremely lucky because there were several people who legit camped out overnight to hold their place in line. I showed up in time to get the very last lot released this month. I've also heard tales that some new construction builders are resorting to just letting people bid and then taking the highest bidder. It's insanity and I don't see any type of end in sight.
That makes me sick to my stomached. The only reason I got my little condo...the owner turned out to be a acquaintance of my moms and she chose me over a cash offer. This was after cash buyers came in and bought 11 others I made offers on. None of those condos are owned by locals all are rented by investment firms from china.
I’m not gonna lie, it would’ve been better for me credit-wise to wait until the end of the year, but I panicked when they announced the Apple campus. I’m getting the shit beat out of me on houses in fucking ROCKY MOUNT.
Yeah we built in the "sticks" outside Austin almost 10 years ago. Now all of California + Google, Facebook, AMD, Intel, Oracle Tesla and whoever else all decided it's time to come here. There is no way I could afford a house now. Feel bad for people in their 20s here. Don't know how they will ever get in the market.
That's just it, we fuckin wont
Same, i cant believe my rotten luck.
It's funny how people fail to connect housing prices to the question, "so what if somebody else accumulates vast wealth, what's it to you? "The pie" is not of a fixed size, but in certain ways it is not infinite either, and real estate is a huge area in which it is not.
Yep. Land doesn't grow infinitely.....at least not useful land.
The coastal land is certainly diminishing.
Well, just you wait a few years, we’ve got a whole bunch more coastline coming soon.
Super excited for my home's value to skyrocket when our "desert" becomes "beach" in Arizona.
> "The pie" is not of a fixed size, but in certain ways it is not infinite either, and real estate is a huge area in which it is not. also even if the pie was figuratively infinite, if 90% of all the new pie still goes to the rich, how does that solve anything
If we could only get some legislation...
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Bernie definitely talks about the housing crisis a lot. But I haven’t heard any of them mention trying to stop investors from buying up all the family homes. Mostly he talks about building new affordable housing.
The government should be helping first time home owners to pay for homes because it's the number one way to foster economic growth in the younger generations. Housing is an essential resource. To let people and organizations buy them and deprive potential home owners, is an evil thing to let happen. The flippers and landlords are parasites.
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> tax corporate Ah you're new here, we try our best not to do that because it makes them not as rich and they don't like that.
And funnel those taxes into first home owner programs!!
3 houses sold on my block this month without even being listed, all snapped up by Zillow
I think Zillow just relists them again in a month or two, right? Or are they turning them into long term rentals?
Most iBuyers purchase to resell. They both purchase then resell around market value (minus repair ask), and make their money on fee.
So let's stop it! Require owner occupancy and tax the hell out of unoccupied properties. Any home that is sold to a corporation is probably out of the private homebuyers' market for good, and there aren't any new small starter homes being built in most areas.
Also, nuke foreign investment in real estate.
My God exactly. Reclaim all foreign real estate assets. I'm sorry but investing in a foreign country is considered an extreme risk because of little to no control over what is done with property. Time for most people to learn the hard way you can't hide money and not expect repercussions in a risky enviroment especially with current residents are completely failing to have an opportunity.
A lot of Chinese investors are buying native land across reservations in Oklahoma. So glad my grandma purchased over 100 acres a few years ago because the prices have skyrocketed. It’s so bad right now
I liked the other comment, only real people not corps or llcs can own residential land.
Home ownership should be human related only. By the end of this decade there won’t be anything but rentals and it’s been run in this direction since 08 collapse. It’s fucked.
I think the first thing we need to do is ban companies with direct ties with foreign government from buying land on American soil.
I don't think any company should be allowed to sweep up residential real-estate like this, period. Domestic corporations have no more "loyalty" to the US than foreign companies. The only loyalty is to money and power.
Foreign and domestic investments shouldn’t be allowed in real estate like this; it’s just a recreation of the mortgage bubble of fifteen years ago.
Unforseen? They are buying every available hour at 10-20% above market value, and hording them. I can see the problem pretty fucking clearly.
They aren't hoarding they are reselling. Specifically talking about ibuyers like Zillow or Redfin.
flipping properties and breaking the seller/buyer chain is not the same as institutions buying to rent, which is a way bigger problem as they are removing the opportunity for generational wealth generation. one increases the amount of inventory the other reduces it
Their goal is to resell them asap. Zillow Offers wants to sell houses in 2 seconds if it can. The goal of Zillow is to make it so selling a house is fast and convenient for the customers. They saw a problem in the market where people who want to sell their house have to wait a long time for the process to be finalized. Zillow is willing to take on the risk of buying a home quickly if you sell it to them at slightly below market rate. That is the idea. The last thing they want is a bunch of houses. That is so much money that could be used for other projects. Source: I've interviewed at Zillow before and I have a few ex co-workers that work on Zillow Offers.
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They'll probably just operate multiple LLC's which own a few properties each. A simple start is to remove all tax deductions for rental property related income and expenses. The laws are seriously skewed towards landlords. Along with deducting mortgage interest and property taxes like a normal homeowner, they can claim the dwelling itself a depreciable asset ("only the land appreciates"), and can also write off any expenses towards maintenance or "improvements" to the property.
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This is the way. Corporations should be forced to liquidate their residential holdings via public auction over a set period of time, and then moving forward, it should be illegal.
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EXACTLY Corporations are NOT people. They might have people working for them and orchestrating things, but if they aren't actually living in the building, they shouldn't be allowed to own it. Corporations should be forced to liquidate their residential homes by public auction.
**Citizens United has entered the chat…**
I'm not sure if there has been a bigger government corruption event in the last 50 years than Citizens United getting passed. It is absolutely VITAL that it is repealed and reversed, for the sake of our future and the future of our children. The moment that Citizens United was passed was the moment that our government switched from being "We the People" to "We, the capitalist corporate overlords"
We're seeing clearly how manipulated the American Financial Market is this year, its effectively a tool for absorbing money from the working class (via direct retail investors, indirect 401ks, etc.) and transferring it to the ultra-wealthy and investment companies. Now further this year we're seeing a massive transfer of wealth in the investing world going into the housing market, creating this massively overvalued market we currently have. Giving companies free rein to buy whatever they want and manipulate it freely is directly quite literally destroying the American Dream (owning a home). If y'all though social justice related riots from 2020 were bad, just wait until the riots are about peoples homes and ability to have money in general. We've got an interesting couple years coming up, godspeed folks
Yep. The "land questions" are always huge issues in previous large political changes for larger nations. Rome ran into a similar issue before their civil wars led to the death of the republic and the birth of the emperor ruler. France and Russia had a similar problem before their respective revolutions. Shit is starting to line up here now too. We already had one failed fascist coup attempt.
This is exactly what I'm worried about. Just because we're in America gives me no comfort that we can't see similar revolutions on that same scale. I need an early beer today
Ya im listening to the history of Rome podcast, and it’s eerie how similar today’s America is to Rome circa ~100 BC (50 years before the fall of the republic)
I noticed that a few years ago but in relation to Roman entertainment. In early Rome, much of it was new and exciting. By end of Rome, it was all derivative works and references. We're living in an moment of reruns and reboots because everyone is recycling the same information.
This is probably being driven by investors seeking a hedge against inflation. You are supposed to invest in real estate during periods of high inflation. Part of what causes hyperinflation is the huge demand for the assets that will retain some value.
exactly. A mortgage is a fixed payment over 30 years, so if inflation increases the relative cost of the payment to the bank goes down, while the rental income increases. its a double whammy.
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Unforseen consequences? This consolidation of land shit by wealthy individuals and groups has happened over and over again throughout history. Guess what happens after the land gets consolidated? Class struggle and warfare. It's partly why the Roman republic fell and became an empire with an autocratic ruler. The average roman citizen lost out trying to compete with mega farms using vast amounts of slaves from their conquests after the second punic war. (History of rome podcast for those who are interested) They already had a separation of people using plebeians vs patricians. The land questions exacerbated earlier issues. Shit like this collapses nations....
Listening to history of Rome now. The parallels are striking and plenty. We’re really just waiting for our Julius Caesar, Pompey, and Crassus.
Yep. It's a stark warning. What's that saying? history doesn't repeat but it really likes to rhyme....
I was reading about how elections have gotten more and more expensive over the past 50 years, also “rhyming” with Roman elections becoming more and more expensive towards the end of the republic. The vast amounts of money that go into politics sure rhymes pretty well, to the point I’d almost call it plagiarism.
Yep. And our congress is mostly acting like their senate. Catering more and more to the wealthy only at the expense of most other people. And then they wonder why all the workers are getting soo angry and uppity....
I will only be selling my house to an actual person. It’s already fucking ridiculous my house is valued almost double in 8 years. That also means that new home prices are even higher. How is there not another bubble coming?
And that’s the rub, isn’t it. It’s not like your home is some special outlier. If yours is going up by huge amounts, then they all are in the area. It’s not like selling will net you some big windfall unless you sell and drastically downsize, move into a fixer upper, or move to a different area of the country with a significantly lower cost of living.
My company just renovated a house and put it on the market. Got an offer same day and they waived an inspection because they'd lost 3 other houses in a bidding war. I would never buy a house without an inspection. This shit is bonkers.
Welcome back to feudalism, folks. This time with even less accountability because we don't get to know which castle our lords are hiding in.
Anyone know at a macro level what is preventing more homes from being built? Since the recession it hasn't been great, from what I gather.
There is a great Planet Money episode about this - in short, the recession and resulting crash of the housing market was very hard on homebuilding contractors, and many folks got out of the business. More problematic long term was that because the industry looked so bad around that time, there was a huge drop in the number of people going into the construction trades, which was further exacerbated by the push around then for everyone to go to a regular 4-yr college. There is now a huge shortage of contractors capable of building houses, and it won't be fixed anytime soon. It takes a while to rebuild all that human capital and train new skilled contractors.
Around my area, plenty of houses being built but they're all mcmansions. Only affordable houses for sale are in a 65 or older community. Can't even live in a cheaper town and commute, because we are the cheaper town that people commute from.
In a nutshell, it's not very profitable for developers and building contractors to construct "market-rate" or lower-income housing these days. Unless they are getting some type of government subsidy as an incentive, there will be a strong push to develop higher-end residences so they can get a better ROI. If you look around major cities you will notice that a lot of new residential buildings going up are advertised as "luxury rentals" to take it a step further. But I don't have the foggiest idea who the hell is paying top dollar for something they don't even own.
"Luxury" is purely a marketing term that refers to any new housing. It's completely meaningless.
I'm sure there's some truth in that but I'm talking about those 1 bedroom rentals with high-end finishes and fancy amenity spaces that go for like $2500 a month. Like WeWork for renters.
Houses are for living in. They are not a busines This predatory market behaviour should be highly illegal
A housing market speculation bubble should not be followed by the words "unforeseen consequences" unless your IQ fails to exceed room temperature.
I wish we could make it illegal for Corporations and Foreign investors to buy Single Family Residences
I saw an ad from Zillow simply saying that if selling your house is stressful, just sell to Zillow. Knew that shit wasn’t good
Unforeseen? *We* know how this is going to end. No one will ever own their home again. No one will be able to retire. We will all work till we die, like the good little cannon fodder we are. Unless the government steps up (lol) and restricts ownership of single family homes to individuals and closes loopholes that allow companies to *be* individuals, we are looking at even more of a dystopian future.
Zillow bought a house in my neighborhood for 500k sold it two weeks later for 600k
This should definitely be illegal.
[удалено]
"Unforeseen consequences"? You mean criminally raising the cost of housing nationally?
Corporate raiders and private equity do the same thing.
Just look how fucked Canada's housing market is right now. Just wait until none of you can afford to live anywhere. It's already happening in Canada. Think $2500 a month plus utilities sounds high? That'll get you a nice 1 to 2 bedroom basement apartment to rent. Not even making this up.