Here a link with others:
As blogger-in-chief here, I’ll stay on the lookout for the positive housing news – because you won’t have any trouble finding the alternative, like this guy who has been calling for home prices to drop 10% to 30% for several years now:Link to Doom
Here’s a Bloomberg essay that draws some comparisons to the 1994 market, which is another time we had a spike in mortgage rates. We had neg-am and no-doc mortgages then, and were coming off a multi-year downdraft of housing prices due to the S&L crisis, but if mortgage rates are the big decider, then it’s a fairly good comparison – note the 20% drop in new-home sales:
Housing market softness in the back half of 2018 has investors and the public wondering how bad things might get. It’s understandable that people would be worried, considering that the last housing downturn led to the worst economic crisis since the Great Depression.
But housing market fundamentals in this cycle are nowhere near as risky as they were in the mid-2000s. Real-time data on mortgage applications suggest a milder path. Coincidentally, it looks a lot like 1994.
Earlier this week the grays were on their way out, but it may take a while. Can you believe that 34% are removing the bathtub? From Houzz:
Anticipating Aging Needs: The majority of baby boomers (ages 55 or older) are addressing current or future needs of aging household members during master bathroom renovations (56%). One-third of boomers are addressing current aging needs (35%), while nearly a quarter are planning ahead for future needs (21%).
Curbless Enthusiasm: Nearly half of boomers change the bathroom layout and one-third remove the bathtub (47% and 34%, respectively). Other upgrades include installing accessibility features such as seats, low curbs, grab bars and nonslip floors in upgraded showers and bathtubs.
The Suite Life: Homeowners are focusing on the master suite as a whole, with nearly half of master bathroom projects accompanied by master bedroom renovations (46%). Master bathrooms command the second-highest median spend ($7,000) in home remodels, behind kitchens ($11,000), while master bedroom spend rivals that of living rooms ($2,000 versus $3,000, respectively).
Premium Features Galore: A surprising one in 10 master bathrooms is the same size or larger than the master bedroom (11%). Beyond size, premium features in master bathrooms are on the rise, with dual showers, one-piece toilets, vessel sinks and built-in vanities showing significant increases in demand in the last three years.
Bathed in Gray: Gray palettes continue to lead in walls and flooring and are increasingly popular in cabinets. Newcomer styles continue to overtake contemporary style, with farmhouse more than doubling in popularity, from 3% in 2016 to 7% in 2018. Matte nickel and polished chrome are the most common metal finishes.Link to Article
Above is the summary of yesterday’s housing and economic outlook sponsored by First American Title. Click here for the full report:
Let’s mention those who will be making the market in 2019:
- Those with the least amount of experience and education.
- Those who don’t own a home here yet.
People in these two categories aren’t hampered by the over-analysis that comes with owning a home here currently. Those who already own a home in San Diego have paid less, and have a lower mortgage rate. We are trying to make sense of giving that up, and paying more!
It’s a burden that thwarts most attempts to move by current homeowners.
But those who don’t study it too hard, or don’t already own a home will forge ahead. They have already decided that buying a home make sense in this environment, and have their own personal consequences if they don’t buy. They aren’t going to be talked out of it either.
Figure out how many people are in that group, and you can predict the future.
Here are the categories:
- Up-sizers with strong needs
- Incomers from out-of-county/state/country
- Affluent people
Everyone else will enjoy their comfortable spot on the fence and wait-and-see what these folks will do. Let’s acknowledge though that people in these five groups aren’t tethered with the same restraints as the rest of us – it’s just a matter of how many people are in these groups.
How many? My guess is 80% of those who bought in 2018.
Now if they could just get along with Qualcomm:
Apple today announced a major expansion of its operations in Austin, including an investment of $1 billion to build a new campus in North Austin. The company also announced plans to establish new sites in Seattle, San Diego and Culver City and expand in cities across the United States including Pittsburgh, New York and Boulder, Colorado over the next three years, with the potential for additional expansion elsewhere in the US over time.
Apple plans to grow its employee base in regions across the United States over the next three years, expanding to over 1,000 employees in Seattle, San Diego and Culver City each, and adding hundreds of new jobs in Pittsburgh, New York, Boulder, Boston and Portland, Oregon. The company recently opened its newest office in Nashville, Tennessee and Apple’s Miami office is projected to double in size.
Jerry Riopelle is a long-time favorite of those who grew up in Phoenix, Arizona, and unfortunately he just cancelled his two retirement shows at the end of the month due to a health issue. His New Years Eve gigs were legendary, and here’s an example – Get Well Jerry!
Here is the anthem:
We can probably expect that entertaining real estate videos will be in the next wave of realtor marketing:
Sellers have not been moving as often, with a typical seller owning his/her home for 11.5 years before selling, the highest level in at least the last 38 years. The trend was especially obvious for older generations, as baby boomers typically owned their property for 15 years before selling, while the Silent Generation held on to their properties for 30 years before selling.
In Houston, an agent uploaded photos of her listing that included models wearing underwear. The Association deleted them.
We allow photos and descriptions of properties that are highly exaggerated or distorted, but now we’re drawing the line at underwear models?
There have been a number of banks and mortgage companies announcing drastic layoffs or going out of business altogether. But most have been refi shops, and now that rates are in the mid-to-high-4s, there’s nobody left for them to refinance.
73% of today’s realtors have never worked in a 5% mortgage-rate environment. Let’s keep those rates low!
Want to know one of the largest growth markets on the planet? The world’s 65-plus population. Already at a historical high of over 600 million people, it’s projected to hit 1 billion by 2030, and 1.6 billion by 2050!
AND…..this expansion will take place primarily in wealthy countries. In the U.S. alone, the spending of Americans ages 50 and up in 2015 accounted for nearly $8 trillion worth of economic activity. (Barron’s)
Let’s hope that ‘secure collaboration and communication portals’ is 100%!
Note: Following both the ’70s and ’80s prices booms, price increases slowed significant and mostly moved sideways for some years in nominal terms. Maybe that will happen again. Bill McBride
We love being #6 because any time a resident from the Top 5 cities comes to San Diego, they think we are giving it away!