#housing #realestatemarket #interestrates
Zelman & Associates Co-Founder and CEO Ivy Zelman joins Yahoo Finance Live to discuss the housing market heading into the Fed’s interest rate hikes, supply concerns, inflation, and mortgage rates.
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You know somebody is totally clueless when they only say something “could” happen. Heck, my toddler niece could be right that her little ponies might jump right out of the TV screen.
No one can predict the future…
Okay
obviously this guy is a real estate agent lol, how can you predict the future?
what are you looking for a guarantee? U must work for the govt
You know we’re in a bubble when irrational exuberance takes hold. Even just the mention of a correction or slow down is met with with denial.
This lady is delusional. If you listen to her you will be priced out of the market. We are so undersupplied it will take a decade of building to get us out of it.
@Big Donkey Um where are you because houses in the Austin area and surrounding suburbs are selling like hotcakes
hahaha another agent spouting prayers lol i’m in the west super hot market and there is a ton going up and even some empty ones. And sales y over year down 15% alot of regular people are already priced out . Prices will go down in the next two years probably. This year they will prob keep climbing. But everything always has to correct dumb money has been buying in these past two years haha ask warren buffet what he does sell when everyone is buying buy when everyone is selling.
@jack johnson this has been proven to be a myth
Have you looked at the data ? This has been alot of manipulation by the media, realtors, banks, Government etc. Go look at the data and you will see that new construction is at a all time high.
the NARrative
I’m 25 and no one I know around my age can afford a house in our local area. And can barely afford the rent. We need it to slow and crash!
@Mark. Matthews the main reason houses are so expensive is because of too loose monetary policy and too much fiscal stimulus.
25, you need to save money first, collect 30K cash, then go buy a property.
@stachowi you & your wife make great money but no debt? that is not good sign. Debt is wealth if you know what i mean
@ben nguyen not if it’s being reinvested in a high growth company that you own… 10X cash on cash.
@ben nguyen investing pre-tax money that can multiple each year (not 20%) is the key to true wealth.
Then you sell the biz for large exit.
If you’re talking about using debt for real estate… yeah, real estate is slow.
Tons of investors are holding and waiting for homes to be rehabbed for renters or flips. We have multiple problems, not enough moral discipline and people who want to do the actual physical WORK. Immigration influx has created insatiable demand that can’t be filled. Home builders are stuck in the upper middle class price points above 300K, so millenials are getting left out as well. I’m a project manager after 20 years of general contracting. Home prices will not crash. Repeat there is no crash coming like 08′.
Immigration influx you say? Demand you say? Good thing there are plenty of home builders hiring lifelong jobless American citizens a livable wage to build new houses.
Its all regional… the more interest go up , the more likely the crash.
I bought my house during the 1980s real estate bubble and 13 years later it was still worth less than I paid.
She knows her stuff ….
We’re busting but can kind of wait…how long does she think until more inventory is available?
18-24 months
if you are looking to buy a house, NEVER go to a realtor first. Go to a mortgage lender, find out what you are able to borrow, THEN go to a Realtor.
I disagree. A good realtor will recommend several good local mortgage brokers who will then compare rates from different mortgage lenders. The rates of those lenders will affect how much you are able to borrow since it affects your monthly payments. If you try to find a mortgage broker first, you might end up with those mediocre online brokers that don’t have local offices, give you a useless pseudo-approval letter, and may fail to actually give you a loan right at the time you need it.
Right we went to a lender…a year later we went to our realtor and he reccomended a lender and now we realize how misinformed and green our last lender was…we are now looking at paying 100k more for a smaller house because we wasted all that time. because of it.
Never trust a realtliar. Ever.
Why aren’t we doing anything now about investor real estate companies? Housing is out of control and need to be reigned in.
@Nolan Hall Agree! The market will reign them in.
Lol they’ll keep buying and selling to each other until the whole market collapses on itself, which we’re seeing now lol
@Steven Napierala I started noticing that also. Zillow will buy a home and Opendoor will buy that home and put it up for sale (at a much higher price) and it keeps going and going and going.
They should stay out of single family homes
@Tas Singh no law preventing them from doing so, which is why it’s strange no state nor federal government is trying to make this law since this is market manipulation.
Ivy’s been seeing this for two years=)
I went back to double check this, she was saying the market was going to boom in 2020, and didn’t say anything about a decrease until November 2021.
She is spot on
Right after there is a 1.5-2 months of inventory there will be an avalanche of new listings as current homeowners move into the market almost all at once
Yes, that’s EXACTLY how it happens. It is the “snowball effect”. Happens every time without fail. You can’t change human psychology!!
Any guess on when we’ll see this influx of properties? She spoke about being patient.
Idk if the graph is correct but it says there is 6 mo supply right now? Housing prices aren’t reflecting it though
@Ty Shaw Real Estate is very “inelastic”. Meaning you won’t see this happen “overnight”. In my personal opinion it will take a good 1 to 2 years (more likely closer to 2+ years) for it to really “snowball”, resulting in PRICE CORRECTIONS.
Simply because there is a ton of new listings does not mean sellers will just “give in” right away. They typically tend to be very adamant on their asking price for a long time, and only relent once they finally begin to realize the reality of what’s happening!
Interest rates are so temporary, you’ll probably refinance several times on a 30 year loan anyway… Waiting to buy is just sitting on the fence while Houses just KEEP GOING UP!!! They NEVER GO DOWN!!! I’m loosing EQUITY sitting on the side lines!!! 😉 Just saying…
It’ll go down. Also, you won’t be able refinance if you’re upside down in your mortgage owed.
We are all safe the fed has our back. Fannie and Freddie won’t let our mortgage go underwater.
It was so cool when I bought in 2006. The prices went down about 50% over two years and the interest rates were cut in half, but I couldn’t refi underwater.
You think!!! It’s totally over priced at least 50-60%!!
easy
Maybe but US home prices in relation to income are actually on the low end compared to other developed nations.
@LiveWell6 well adjusted for inflation in the US they’re way over priced (even compared to 2007-2008)… just wait until the bills start coming due and inflation taking a toll on households… it’s going to start falling apart (fast).
Stock Market slow down and Real Estate finally slowing down and over supply coming up?
whoever did not get on board on housing 2 years ago missed the train so bad. But it’s not the end of the world, anybody can still buy but don’t wait too long.
kinda what they said in 2005….didnt end up to well…
Buying at all time high is not a good idea. Plus you get crap for 400k
Great interview. Lots of actually useful info.
Great video, empowered by blockchain technology the fractionalization of the asset class will cause the number of people converting from renters to owners to accelerate exponentially.
Renters have now gained the ability to use their disposable income alongside their monthly rental repayments to purchase additional ownership in their Primary residence which reduces repayments and increases disposable income which results in an exponential rise in purchasing power…
Is that really the problem? Homes can be purchased with 3% down? If someone wants expose to real estate, they can buy shares of quality homebuilders for as little as $20 a share.
@LiveWell6there are other property markets where requirements are higher and its more difficult to get a mortgage for them this is a game changer. Especially with the added benefit of this setup not being a loan.
If you listen to her last year, you have to pay more than 20% today!
@Rental Watch you sound remarkably like the BFB— Zerohedge
@John CPA Lots of appraisal and mortgage fraud going on.
@RNJO Wrong again.
*Sacramento, CA Housing Prices Crater 14% YOY On Soaring Mortgage Defaults And Plunging Demand*
@Rental Watch You must get your sources from Reventure Consulting. The sky is falling. 😂
@RNJO There you go again…. taking falling housing prices personal.
*Sacramento, CA Housing Prices Crater 14% YOY On Soaring Mortgage Defaults And Plunging Demand*
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Market crash!!!
If you’re buying in now how can you trust these prices, sure long term is fine 20+ years but if rates rise and moratoriums go away, more supply equates to prices coming down a decent amount, at least in theory. And what if the economy goes into recession within the next 2-3 years? It’s possible.
If you buy a home today, and tomorrow is worth nothing…… that has NO effect of whether you can afford the home or not. The payment doesn’t change.
With Median Home Prices reaching $400,000.00 . The Market will start to get real interesting when Rates begin to normalize at around 6 to 8 % .
@Rahzel Washington I was being slightly sarcastic . As we all know with a current US Debt of 30 Trillion Dollars Normal Rates are an Impossibility . But we also know having IR lower than Inflation will only lead to Higher Inflation . Its an ugly cycle that for now cannot be broken .
@Dave Brewer but remember the fed holds a lot of the us government debt. And has shown its willing to take on as much as necessary. Interest paid on fed reserve debt just goes back to the us government treasury (i.e. the higher proportion of govenrment debt the fed reserve holds, the less rising interest rates will actually impact the fed government)
the fed will keep rate around 3-4% for a long time. like 7-10 years
@ben nguyen hope so
Dont forget about inflating property taxes as well.
Average US Home now cost $415K. That means a first time buyer will need $80K down payment. Possibly $15K in closing costs. That’s just shy of $100K. Exactly where would they get this kind of $ cash ? Their parents tapping their home equity is where it comes from. Causing the bubble to grow even more. When it explodes both of those generations get hit very hard. The kid is in a house worth $250-$300K but bought it for $415K……His parents are out $100K, their home is worth 25% less- which is tied to their retirement plan. Nightmare scenario.
@Steven Napierala i know man its gonna be bad
some people think prices will never come back down
@chris whynder Too late.
*Toluca Lake, CA Housing Prices Crater 34% YOY As Days On Market Exceed One Year*
You should see Canada. Our national ave home price is 800k CDN now. And houshold incomes are lower is CDN than American households in USD. It’s been sustained so far… lots of investors, lots of homeless. Buckle up Americans this is going to happen to you
$80,000 as a down payment buys you a trailer home from 2-3 bedroom 80k is a lot of money as a down payment towards first time homes buyer their better off buying a mobile homes at that point
never forget markets move in cycles. debt (even mortgage debt) is a promise to REPAY borrowed money.
Need to drive speculation out of primary markets
There is very little speculation in residential real estate right now. The recent speculation has been crypto, SPAC, and meme stock related
@LiveWell6 yes you are definitionally correct. Investors, flippers, i buyers need…
Oversupply now ??? that is a new one 😂
New construction is reaching 2006 highs. Population growth is the slowest in US history. Where does the shortage come from other than people buying homes that no one is living in. The lack of “inventory” is not a lack of housing, it’s a lack of listings. The listings will come, but buyers won’t be there.
@Chris M Florida speaking: You are not counting with Immigrants and Foreign parking money, if there was a inventory waiting to get sell why there is also no rent? Those house should be listed as for rent, noone left a house close to sell later, they rent it, there is no rent and not sales, I don’t see where that inventory will come from
We are driving towards a renter’s nation. Be on the right side of it because it’s happening. Own property that you can rent. No matter what home values do in the next 2-10 years I can guarantee you rent is going up.
Actually ownership vs rental rates have been pretty stable. Home ownership rates are higher than they were 50 years ago and have risen the last 5 years.
this market is more inflated than 2008. Mark it, might not be this year but next year will bring in a surplus of homes and drastic drop in prices..
hope so
The data says 2008 was far more inflated. What data are you looking at? Mortgage to income ratio is within normal range right now while it wasn’t in 2008.
you are right. will all the new building permits in 2021 & 2022, you will see surplus of homes in 2024 for sure .
We are also just about to reach new build permits of 2006.
over supply? by the time they finish a new generation will be ready to buy.,DUH
Wealth was NOT ‘created’ during this contrived pandemic as you said, wealth was ‘only transferred’ from the middle class and working poor to the wealthy asset class, (largest transfer of wealth in history).
We desperately needed strict enforceable wage and price controls to protect those most vulnerable when this National State of Emergency (still in force BTW) was first declared. Otherwise there’s no incentive to leave a pandemic, nor intentives to prevent future pandemics, which, as we’ve painfully seen now, become highly profitable for a few. Wake up people, we’re now being played like a fine fiddle, using disease outbreaks.
Price controls? Like communist states? That’s how you get shortages when there is a fixed price and it there is no economic incentive to work/produce at that price then that product disappears.
Con artists scarcity, they turn up the heat the minute it took a breath.
To a point this is a con because will prices be as high in the stock market if rates doubled, doubtful. So, who has incentives to make sure it stays low when it should’ve been higher along time ago! It ruined housing for average workers because flippers getting best deals with a rigged deck. Then the anchoring started. Sell only for a million plus unless really necessary, would be nicer. At least then, it’d be a fair game if this nonsense was cut out. They call them ticket scalpers online for other products and services. Time RE got the same label.
residential housing should be off limits for investors. Middle class is getting hurt by them, and if the govt isn’t going to protect their citizens then what is the point of them?
It shouldn’t be off to investors. Corporations yes. Two ways you build wealth in America, stocks and real estate.
Exactly. Investors have destroyed the market in Canada and ballooned prices so far out of reach of many families. Not a path you guys want to walk down
@O Campbell What’s the difference in damage from a corporation (who legally identifies as a person), and a billionaire. There is none. I think it should be totally off limits.
@Division of Labor As someone who is self made I have a problem with someone telling me how to build wealth especially.for someone of color like myself it’s one of the few ways to equalize this socioeconomic imbalance that exists in society.
@O Campbell Are you going to deny that investors make housing more expensive for the average person? What’s more important for society, a small amount of people getting wealthy, or the average person’s ability to buy a home instead of rent their entire life with no equity?
Ivy looks so beautiful today. Great news
You crazy that thin lip zombie ?
Is my reply to positive for you
No just concern in your eyesight.
*Raleigh, NC Housing Prices Crater 18% As Quality Of Life Ranking Slips Three Years In A Row*
It was only a matter of time
This is just a given. As rates edge higher, payments get higher and start to limit the amount one can borrow to purchase a home. So then yes the housing market will slow because less folks can/want to buy at higher rates. Money 101 class.
Face filter?
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*Sacramento, CA Housing Prices Crater 14% YOY On Soaring Mortgage Defaults And Plunging Demand*
Oversupply? Has she looked at supply available currently
She’s talking about the backlog of homes currently under construction. Above 2007 highs of the housing crash. These homes are coming to market within the next 18 months.
she said she is a mom of 3, i dont think she have time to looked at supply available currently. haha. clearly she doesnt know what she is talking about.
@Dutchman Permitting is no where near the highs of 2008. We’re actually significantly under building. She hasn’t looked at the actual figures. Even the FHA says we’re under building.
@ben nguyen No kidding
With housing priced out many buyers, rent will certainly increase. With the increase in rent, there will be a lot of homeless people roaming the street – especially the elderly on fixed income folks of low income, and folks unable to work.
It’s nuts. We need more home construction on a large scale to help alleviate demand and bring prices down.
@Eric Wood Home construction is expected to grow in 2022
@LiveWell6 I’m sure, but will it be enough? It’s terrible having a bunch of wealthy investors buying up houses to rent or flip them for big profits.
The fed screwed a lot of people, the hedge funds got bailed out with those MBS deal the FED bought. Good for the rich, bad for the poor and middle class, thanks to the FED
Buy when you can. Simple as that
housing is stupid expensive now, both homes and rents… the government keeps creating these massive bubbles that have bad consequences all around for everyone.
I agree they need to get out of the bubble blowing business. They think it’s helping but it’s not.
If economic was so great why Feds not raising interest rate?
The Fed is raising them next month
@RiesgoBeats Don’t count on it.
Feds created this mess under Trump
Another words. If stocks stays up. Investors will buy more homes.
Trump created this mess with feds
In Sacramento California. Its cheaper to rent than buying. You don’t need to do any repairs and law is on your side. Not on landlord’s
in my town every old homes sell for over $200,000 way expensive can’t even find homes with 3-4 rooms between $100,000 only some homes with 2rooms less than 700/800 square feet
The Boomers are dying off. Just wait a few more years. There will be plenty of well built mid-20th century homes for sale.
She sounds like she knows what she is talking about, but she’s got it all wrong. There is nothing on the market and homes for sale are procuring 10 offers or more, not from only investors and iBuyers. She’s wrong on rates. They have already moved.
I bought my house during the real estate bubble of the 1980s and 13 years later it was still worth less than I paid.
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When Ben Bernanke stopped the market correction of 2008 he didn’t save us he instead introduced massive market distortions and re-inflated another housing price to income bubble. The greater these Fed managed market distortions become the more homelessness from elevated housing prices and rents the more negative externalities you will find.
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Right research, properly evaluation and success is what you want to make earnings on this steady market.
What kinds of investments do you make. I totally agree with you. I have a lump sum right now doing next to nothing in a savings account. but it’s hard for me to take part in the market right now due to the fulltime nature of my job. it will be way to stressful to combine so i don’t even think about-facing it
Homeowners will at some point become a rich man’s game in the long run. I mean I do know of someone who owned a house in the 1970s who only had to work a regular paying job and supporting his stay at home wife and were living just fine. Now paid off and retired and living the peaceful life. That same concept cannot be applied today but who would’ve thought that it wouldn’t at the time? The same reason why you think homeownership being a rich man’s game isn’t possible in the future yet it might just be.
Seems like buyers rushing to get in before the market rates go up. Def not touching the market even more now. The Stock & digital assets market is tanking and people rushing to buy houses is going to build a bigger housing bubble which may lead to a bigger crash once rates go up and everyone who wanted to rush to beat the rates are done.
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Demographics and land availability is very different today then in the 1970s. We shouldn’t apply historical narrative as a simple reference to today’s housing market.
Investor buyers who are driving the housing market up in this pandemic 😷 would spit their equity out when everything is corrected and we come back down to the original market price… I wouldn’t be surprised if we see a housing market crash 💥 in late 2023…
I hope prices goes down . Over supply in the future is a good things. I am planning to buy in 2023
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What a freaking asset bubble, the Fed really screwed things up…
Have to disagree. I mean yeah the glut of houses will come when boomers die off and new builds catch up. For now everyone is retiring in place since it doesn’t make sense to even down size at a higher interest rate compared to their refi, or there are still covid scares in retirement communities. Milennials are exponentially wealthy after many years saving up in their parents basements, then many of them lucking out with crypto, stocks, and the tech hiring spree. Wealth is more distributed with people working remotely for west coast jobs, or wealthy people distributing to the sun belt and other parts of the US. It’s unfortunately the new normal and I don’t expect a steep correction at least for another decade. But I’m not an economist 🙂 Good luck everyone.
House market price will keep going up in 2022 & 2023 because of the “SHORTAGE” & “INFLATION”!! Eventho the rate will go up, but it’s still low compare before the Pandemic. Look at Texas Houston & Las Vegas houses. Ppl don’t make that much, but the house value is Sky high!! House market will increase at least 10% – 20% this week. And the Pandemic is not going anywhere until 2024…at least!! Bitcoin price so high because of the inflation.