#housing #market
Redfin Chief Economist and Insider Contributor Daryl Fairweather joins Yahoo Finance Live to discuss the housing market, high mortgage rates, and how many homebuyers can’t even afford their payments.
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Yeah, but we want the housing market to crash, after the absurdity that was 2020-2021.
There’s too many eyes on the housing market which will likely keep it propped up. If I’m willing to accept a 10% drop before I buy but you’re waiting for a 20% drop I’ll buy in before you do and keep prices afloat. The people who need a 30-50% drop are screwed because we’ll both buy in before them. You need people to stop looking at housing entirely before we see an actual “crash”.
@Devin Jones your not going to buy if the government is hell bent on pushing us into a depression because it mirrors the 100 year cycle we just had a 110 year dry pandemic how old r you 30
Homes being an investment is a freaking scam.
I keep hearing that homeowners have a lot of equity, but that isn’t static. If home prices fall, that equity is wiped from every local home owner. Last time people were living in homes that had market values less than the purchase prices, folks walked away. Also, why should cyclical normalcy apply now, after the most abnormal run of home price gains in recorded history?
Everyone seems to forget that people were drunk on appreciation pre-GFC. We’ve seen how quick that can evaporate. I remember my old boss showed me a $700k appraisal for his home and 4 years later it was $400k
Eff the FeD
Is this Ryan Reynolds channel??
Lol had the exact same thought
😂 duh
All those people who rushed out and overpaid for a crappy house they’re not happy with. You’re done screwed.
Layoffs are just starting to kick in. The economy has a long ways to drop. The housing market will not start growing again for many years. The Fed juiced the economy with easy money for over 15 years. It will take many years for that easy money to wash out of the economy.
Yep ! All the way back to “Helicopter Ben”
Come on crash! Sad this is the only way I can buy a house because of companies like open door buying everything affordable up….
No! Don’t crash. I like my equity.
How are those stimulus checks working out
Show data to support your conclusions. There are about 1.5 million unfinished spec homes nearing competition with no buyers. That, further increases in interest rates, and the beginning of a recession, accompanied by large personal debt, low savings rates by renters who are burdened by high rent prices, wage increases falling behind inflation rates, as well as softening in some key industries like tech, and the drop in prices could be dramatic, though probably not as pronounced as the 2007 recession.
Millennials are a huge generation and will not stop buy homes if they can afford them.
@A M They can’t. And they have.
@A M no millennials are not a huge generation thats the problem you have. our population growth is the slowest ever in the last 10 years and the immigration we do get they get into affordable housing units/ apartments not residential housing your following the narratives people in interviews tell you 70 percent of it is lies with 2 or so of the things truth. i dont care what the data shows alot of it is manipulated anyway but we had a once in a century pandemic we are nearly a century since the last depression and that happened after a pandemic if history repeats it self that seems likely. Its also a theory that because so many people know this the government is fulfilling that outcome and that could totally be tin foil hat but then just take what i said 2 sentences ago what i said prior
@brian oleson yes you are wearing a tin foil hat. The data isn’t made up. Millennials are the largest current generation. Gen X is the smallest.
@A M im telling you there is not a housing shortage go ahead and believes these people on the news. Things are lining up to the Tee perfect for a severe downturn it was already really likely 2 years ago unprecedented event after unprecedented event its been nearly 100 years since the last depression that came after a pandemic do you really think were good for many more decades without one?
Just say it! Bubble has popped!
It’s popping like a 17 year old’s nose zit on prom night.
The dollar had an average inflation rate of 2.55% per year between 1990 and today, producing a cumulative price increase of 123.64%. This means that today’s prices are 2.24 times higher than average prices since 1990, according to the Bureau of Labor Statistics consumer price index.
According to the U.S. Bureau of Labor Statistics, prices for housing are 128.49% higher in 2022 versus 1990
Essentially Housing has followed inflation on AVERAGE. There could be significant differences in various local markets.
Do the same thing with wage growth and it’s a completely different story. Unless salaries get on steroids, home prices are unsustainable at current rates
@RoadKiLL There could very well be other outcomes. For example more people would become renters and businesses would own homes. Shanghai’s wages are on average at most 1/3 that of the NYC, but apartments are MORE expensive.
@RoadKiLL BTW inflation adjusted wages for American males have been stagnant since the 1970s.
@Ning Zhou all I can say to that is that we should be an example for Shanghai, and not viceversa. Plus look at the mess they currently have over there. I mentioned wages because we should be looking to keep or improve our standard of living and not go in reverse. Although there are so many greedy people out there that would like the opposite. Right now, many are pulling back because they can’t afford RE prices, others because they’re unwilling to overpay. That’s the way it should be, and we should all be supporting fair pricing. An unhealthy market and economy are negative for society as a whole.
If someone bought a house with a low mortgage yet the value of their house is underwater, WHY would they sale? No reason to. Home buyers moved to slow and it keeps getting harder for them.
The difference from the GFC is that loans require much higher down payment and higher income to qualify. There aren’t many homes “underwater”, like she said, and you are right -even if they were underwater they would be fools to walk away just to pay more for rent!
@Art Taggerr That’s the thing. Tackling inflation is painful, but prolonged inflation can be even more damaging. Rents have gotten ahead of themselves with evictions piling up. A decrease in rents is also a very real possibility.
@RoadKiLL True, and tackling recession is also painful. It depends on what side of the fence you’re on. That’s why a soft landing is the best for everyone overall. I seriously don’t expect a crash, and if I didn’t have my own place, I be looking to buy one now, even if I had to work two or three jobs for awhile. The is that Institutional and Foreign Investors see a way of making money. They already bought All Cash, so any rent income adds to their purse.
@Art Taggerr hope for the best, plan for the worst. Getting into a mortgage with declining prices and rising interest rates is a very bad Idea. FOMO is no one’s friend.
@RoadKiLL Declining prices aren’t much, depending on area, and they don’t decline forever. As a rule, with time prices always increase. FOMO may not be your friend, but he’s been mine successfully. To each their own, it’s what makes the world go round.
Locked in very low interest rates last year – Who on earth who had brain would let you lend money at 2% for the next 30 years? Unless they know somehow that life on earth is ending soon. It’s a SIN and CRIME that lenders did this last year and the intelligent governing body stay muted – SHAME. 1) Either increase the inventory to bring down the rates 2) tax the land lords more while providing the incentives to the first time home buyers 3) ban the land lords and real estate investors until the inventory gets normal again or else 4) take an oath in public and say it loud that you are going to destroy the lives of the next generations and rob the first time home buyers which you are doing anyway. People who own houses and support these high prices don’t even dare to buy a new one at these prices. Life is not unfair rather the people who led us to this situation are. This is nothing but a ROBBERY in the name of low inventory and supply-demand dynamics.
Let it all crash!
“Mortgage rates are high” ummm no they aren’t she’s just never looked at a historical chart
They are high when current rates are double what rates were 8 months ago. Especially when they fueled 40% price appreciation in 2 years.
@RoadKiLL prices are high – rates are not high. But yes the irresponsible fed policy did lead to this
@Krassimir Petrov Once interest rates are brought down, people only look at the monthly payment, as a result, the lower the rates go, the more inflated prices become. We were at 0% FED funds rate for 2 years which is rock bottom. Realtors were speedy to raise prices due to the drop in rates, that fueled price growth. Now for every 1% interest rates go up, buyers lose about 10% buying power. So far this year they’ve gone up 3% which is equivalent to approximately 30% less buying power. I completely agree that from a numbers perspective 5.75% looks low compared to double digit rates in the past, but relative to recent rates and how high prices have gone and how fast, the rate basically doubling is a very large headwind for housing prices. With wages not being anywhere close to that kind of growth, you have a recipe for a lot of pain in the near future.
@RoadKiLL oh I agree with you MAX pain is coming – prices are going to crater soon because rates are not going down
@Krassimir Petrov MAX pain! Yes, ULTIMATE MEGA pain! Let’s hope!
It’s a correction. Trees do not grow to the moon and neither do house prices.
Don’t worry, housing prices over time will continue to rise otherwise we’d still be seeing prices from the 20s, 30s, 40s. It all goes up, it may drop some, but 5-10 years from now housing will have higher costs and that’s all passed along to you consumers. Don’t you wish you would have bought a house 10-20 years ago when they were cheaper than 2019….(I’m omitting the past 2 years of crazy housing market increases on purpose).
That’s not actually true. A house doesn’t gain value. What happens is your dollar becomes devalued at a faster and faster rate. Pumping the $$$ number, but actually being less valuable.
In addition, outside of a bubble, prices actually drop year to year if the homeowner doesn’t spend the money required to upkeep the house and make upgrades/fixes.
No, I do not wish I bought 20 years ago or 10 years ago. Houses bought during the last bubble have still not recovered real value (even in this bubble). Inflation, maintance, upgrades, mortgage, etc. A 300k house will end up costing north of 1m after a single 30 year loan (if you’ve got a great rate) due to upgrades and maintance.
Housing crash 💙💙
Fool!
We sold our 2 Rentals in the Tampa Bay Area in Feb for over 3 times what we paid for the Properties back in 91 . The Sale made it possible for us to both Retire early and leave Florida . We wish them well .
Well done! I sold my Tampa house too and retired!
Must feel good being on the side of the brigands at least once in a lifetime.
@NAVSO FOUR I see you edited calling us Thieves to Brigands.
@Kim in Nature Well that’s not really exact. I see you edited you were happy to join them…, playing Hood Robin by the construct of others. Enjoy.
All the angst in the comments predicting a housing crash is missing an important point. Buying a home is expensive now but renting for the next five years is going to be far worse! If there aren’t enough homes built (and with rates high and prices stagnant homes won’t be built) renters will be facing much higher costs every year!
DB is one of MANY small landlords that have been pushed out by the pandemic. Without these properties holding rent down it will skyrocket.
Prices have shot up by 70-80% in last 2 years.
Correction of 10-20% is nothing.
It’s not going to crash like 2008 like guys.
😊
@Kejriwal saara punjab tere naal News flash, we are already at the beginning of a deep recession.
The only “crash” will be from the end of bidding wars. The growth of home prices will stop while the growth of rents will explode!
In 3 years buying a home this past year will look like genius, far cheaper than prevailing rent.
@skyak That is plain vanilla thought. There is always a good rental market somewhere, just need to be a bit far off or look better. Not everyone needs to leave in downtown or by the stupid lake or sthg.
@NAVSO FOUR “If you can’t afford the rent, MOVE!” Is a seemingly reasonable solution. But it has never worked in the past so I doubt it will this time. Try telling the rent protesters in NYC to just move to Pittsburg or Cleveland – they will tell you NYC is the center if civilization as they beat you with their signs!
The national home price jump is not so much about growth as it is an infection released from overpriced coastal markets, spreading to desirable lifestyles elsewhere.
Renters don’t get to take big capital gains with them leaving expensive markets, and they might not be paid as much. Waitresses and bartenders don’t make six figures in the Midwest.
Plain vanilla maybe….Right? Absolutely!
@skyak i knew this was about NYC, who cares aboout NYC almost nobody can even afford to eat healthy in there, why does even housing matter if you are going to eat and smell sh*t all day. If you are over 40 and haven’t made it in your field you do not belong there anyways, and no it is not the center of civilization, tell that to Google, MSFT workers topping half a mil a yr. all over the country.
They’re running out of water in the SW, no wonder people are desperate to sell….
Um, they were desperate to buy just 4 months ago??
You sure you don’t want a $500,000 1,200sf tract home next to an airport that went for $70k in 2012 and $250k in 2020? There are thousands in the Phoenix area. Homeless people on every corner get thrown in for free. Or maybe you’d like to rent it for $3k/mo.
Is this really “the chief economist”? Really? Who is paying her for this”knowledge”? I didn’t hear anything different than a small talk one has at a grocery checkout with the cashier. Sigh. Time will tell, and she will eat her words. Incredible to me how people like her keep inflated titles with nothing to back them up.
I thought the same thing. Looks and sounds more like a YouTuber or a wannabe influencer.
CRASH please
Interest rates go up, housing prices goes down, until they catch-up with inflation this is quite simple.
Substitute “greedy” for “overconfident”. Let’s not have good people emulate businessmen. Settle down everyone housing prices are going for a sleigh ride.
Ryan Reynolds???
I see some homes bought in 2019 2020 2021 back on the market for 600000 over what they paid for it. No improvements…. Yes overly ambitious is an understatement.
Price is dropped. it’s funny when you said homeowners have a ton of equity gain. Good luck when unemployment hits, and companies require to go back to office. There are millions reason to sell but a few reasons to buy
It’s an employee’s market and a seller’s market. Those two things will flip dramatically and rapidly in the next year. Hold onto your butts.
This guy looks so much like Ryan Renolds I keep half expecting him to make some overly sarcastic comment to veer the conversation off topic
Well she just tore apart her own argument these clowns don’t understand the fed is going to continue to be hawkish until further notice.
“Tax the land not the property” would be terrible. We already have a huge problem with new construction being all focused on large luxury homes. The problem is good locations will get filled with large expensive homes that require too much money to maintain.
The real solution is to cut crime so that poor areas can become desirable for gentrification. That’s how the desirable locations were created.
@Josh Bodnar If they young spent half as much time organizing, buying, and forcing out crime that they do complaining and blaming others, there would be an abundance of good urban multifamily properties.
It is not a coincidence that this “housing crisis” is concurrent with a policing shortage and crime explosion.
slum lords
Let’s keep the inventory Low like what you have been doing in the last 10 years. Let’s squeeze and jack up the prices. The middle class, first time home buyers and the new generation who are yet to buy homes are good for nothing fellows, let’s rob them. No one is going to question your greed.
Whenever these fraud larpers make this claim you can be sure they are the malpractice actor, like Jerry Falwell.
“There’s never been a better time to buy” “Get in now before you get left out” “Prices can only go up” -Every Realtor Ever (15 years ago)
@P S After 08 was a good time to buy though. Alot of us younger people was the only time we could afford a house 😂😳
“We were taken advantage of by an ambitious poolboy” – Jerry Falwell
Such a bunch of bs 😄 foreclosures in 2023
She says the home owners can wait out the market because they have a lot of equity and in the same breath she says prices will keep falling through the end of the year. What kind of food do these analysts eat so I don’t feed it to my kids? She forgets that falling prices wipe out equity.
😂😂😂😂😂😂
No sign of new smart homes or rolling smart homes (yet). The forty-foot electric prop yachts are going through the roof on the other hand. Time for disruption of the real estate market. Conversion of diesel pushers into hydrogen internal combustion engines is another overlooked opportunity similar to extended stay at hotels.
Homeowners are sitting on record equity… yes, SITTING ON , j. SITTING ON
Damn she can be my homeowner.
2:30 Can anyone recall the scene in “The Big Short”?
“Oh, it’s just a gulley.”
Believe this at your own peril. These analysts say a lot of things, often times contradictory to swing the market which in turn translates to their personal gains. Make more thorough researches before putting your money somewhere or better still, get a pro. to help you (that way you minimize risks and save time). Made my first million earlier this year this way after losing a fortune to YouTube inspired “trial and error” investing advices. Goodluck!
@Debbie Berger wow I know this little lady. Once attended a fundraiser she was also in attendance in Vancouver,, Great speaker with a funny accent,, She’s American though, I doubt she works with foreigners,,,
@Debbie Berger Thank you…
@Dr.Kari Douglas This right here is the second time I am coming across this name in a week. Came to my school for a program and it was lit and yes, she has a really cute southern accent.
@Dr.Kari Douglas Guess she does. I am neither from there nor do I stay there hahaha.
@Herbert Woods 👍
This lady is whacked she should listen to Ray Dalio who actually knows what’s going on in the world
Interviewee is not even old enough to have worked during >1 recession, let alone one in which Fed is not there to create artificial “fast recovery,” as fed is TIGHTENING into new recession for the 1st time in DECADES.
Please YAHOO, no more bubbleheaded interviewees, contradicting her own take given 30 seconds ago, then providing no data (support) for “theories as fallacious as Marx’s”. I just put YAHOO on “don’t suggest content from this channel”.
She’s so lost. Poor soul.
What about when Chinese buyers start dumping? After Evergrand collapses I would expect institutions to start dumping too. A massive price drop is very possible
They are clueless, I’m not touching housing any time soon.
From my past experience, prices will not move down in a meaningful way until sellers can no longer make payments.