Is the realestate bubble bursting?

[2HOTinPHX]

We've been kicking around the idea of relocating for a while now. Just out of curiosity on June 15th we got a preliminary offer from Opendoor for our house. Wow really good offer at $500,300, no showings and none of the usual angst of waiting for offers and clean closings risk. Neighbor across the street sold his home, same model for 435,000 last year with traditional realtor. Opendoor does take 5% "service Fee" though, sounds like commission to me? Let the emails and text messages from Opendoor start flowing....

But where would we go as everything seems pricey right now? So were doing some online home shopping with Redfin. I downloaded their phone app. Did something that got new listings and price changes emails sent to us automatically. Noticing a lot of price change emails are reductions in prices. Hmm a sign of the times? Sellers market turning? Air being let out of the bubble with the recent quick rise in interest rates?

Then yesterday June 27th I clicked on an email sent June 16th titled "your offer may increase" from Opendoor.....clicked on the link and POP!!!.....preliminary offer reduced to 459,500... WOW that hurts....is the sky falling

[Aerides]

I review zillow weekly for my neighborhood and general area. No bursting here, no houses dropping.

We have our first 1M listing, but the exponential growth seems to have slowed. We were a $400k range pre-2020, and seem to have tapered off with houses selling around $750. No mark downs or multi-month listings except those that are pushing their luck to start with.

There was an open house new listing at $795 this weekend, must have had 20 cars lined up.

[pacergal]

Our prices are still high here, but I can see lots of cooling of the market ahead.
Definitely nothing compared to 2008, not even close.

Higher interest rates seem to slow things down, it would definitely make me stop and think.

[2HOTinPHX]

Quote:

Originally Posted by Aerides I review zillow weekly for my neighborhood and general area. No bursting here, no houses dropping. We have our first 1M listing, but the exponential growth seems to have slowed. We were a $400k range pre-2020, and seem to have tapered off with houses selling around $750. No mark downs or multi-month listings except those that are pushing their luck to start with. There was an open house new listing at $795 this weekend, must have had 20 cars lined up.

In the past we have found Zillow to be slow to update there website listings has that changed? When we sold a home back in 2005 it was listed for a few months on Zillow as still available after we had already closed.

Then there is this Zillow screw up. When we sold our parents home last year it was update and flipped...
https://www.zillow.com/homedetails/3...24926214_zpid/

Sold: $1,350,000Sold on 09/15/21 Zestimate®: $747,700 .....

https://www.redfin.com/CA/Newark/360...0/home/1949943

Redfin estimate $1,558,226

Someone is off a few dollars

[wrigley]

I got a funny feeling that all those people that paid $450,000 and up for homes in my subdivision over the past year, year and a half, are going to be a little shell shocked soon.

Mike

[copyright1997reloaded]

OP, glad you started this thread. I was about to do the same thing.

Nashville prices dropping?

https://www.youtube.com/watch?v=sgPSe3mQZYk

Caledon, Ontario median price drops:

https://www.youtube.com/watch?v=Gv6Xzga16Mc

San Francisco, sellers dropping asking prices:

https://www.youtube.com/watch?v=gzjIlAt2duA

I would also like to see in-depth analysis on the other side (i.e. suggesting markets are not flat and are strong).

[jebmke]

Quote:

Originally Posted by wrigley I got a funny feeling that all those people that paid $450,000 and up for homes in my subdivision over the past year, year and a half, are going to be a little shell shocked soon. Mike

I agree; it takes time for the impact of rates and liquidity to flow through the RE market but it will happen eventually. Some locations will fare worse than others.

[copyright1997reloaded]

Northern Florida (Jacksonville area):

https://www.youtube.com/watch?v=iD6nzYZEGCo

I'd say that there is a lot of "noise" in the week to week numbers, but interesting none the less.

[Chuckanut]

I try to advise younger members of the extended family to always buy a house they will enjoy living in. First, unless one has very strange tastes, that helps when they sell. The features they like probably also appeal to many of the potential buyers. Also, at this time of rising mortgage rates, the value may go down or level off for a few years. It's a lot easier to put up with that if one lives in a house they like and is located in a neighborhood they like.

My current home dropped a cool $100,000 in the 2008 mess. But, I like my home and I like my community. Thus, no big deal.

[daylatedollarshort]

Our house dropped on Redfin by $50K the past few weeks. Mortgage rates are up around 3% more than they were a year ago. That equals a huge increase in payments for high cost of living areas.

[madatrub]

Id call it "cooling" in NJ, but we arent seeing much giveback, especially compared to pre-covid.

$400k listed houses, which a month or two ago would have 40 offers over a weekend, are having to cut about $25k in a week in order to attract buyers. Same houses were $300k last year.

[captain3d]

Mortgage applications have fallen drastically and companies like JP Morgan are laying off the mortgage staff. I will be no surprise to find house prices coming down just like everything else.

I am selling some rental property at what could be peak prices

[Another Reader]

We haven't had any listings or sales in my subdivision of approximately 500 houses in almost a year. Today one of my model was listed for $2.6 million, the highest price ever for this model. It's well maintained and decently landscaped, but not extensively updated. We shall see how they fare...

Edited to add: Nine SFR's in my entire zip code are showing on Zillow. Thirteen on Realtor.com, with four pending.

I'm in Silly Valley...no indication of any job losses in my neighborhood. Yet.

[2HOTinPHX]

Quote:

Originally Posted by Chuckanut I try to advise younger members of the extended family to always buy a house they will enjoy living in. First, unless one has very strange tastes, that helps when they sell. The features they like probably also appeal to many of the potential buyers. Also, at this time of rising mortgage rates, the value may go down or level off for a few years. It's a lot easier to put up with that if one lives in a house they like and is located in a neighborhood they like. My current home dropped a cool $100,000 in the 2008 mess. But, I like my home and I like my community. Thus, no big deal.

Good advise. I don't think there are any hidden time bombs like there were in 2008. I predict a slow down and slight price drop which will hopefully allow more sustainable affordable house market?
We got hit with the same 100k equity loss in 2008 but just like the stock market buy and hold and hope for the best!

[ShokWaveRider]

I think it depends on your neighborhood. There is a lot of clickbait and soothsaying on YouTube ..... BUT they get paid for that! All good in our neck. $1m homes + all seem to be staying around there.

[copyright1997reloaded]

Quote:

Originally Posted by captain3d Mortgage applications have fallen drastically and companies like JP Morgan are laying off the mortgage staff. I will be no surprise to find house prices coming down just like everything else. I am selling some rental property at what could be peak prices

I had a client "like" JP Morgan Chase when I worked in the financial industry and am reasonably familiar with the kinds of tracking systems the businesses (credit card, home finance, leasing, bank loans, etc.).

My opinion: The fact that Jamie Dimon pivoted in his statement over that short period of time and so drastically told me then and there that he had seen some "early warning" kinds of data from various lines of business that got him worried. We will only know in retrospect what that was/is. Their earnings are scheduled for July 14th, I will be reading their report carefully. (Unless of course they preannounce something after the quarter ends June 30. Note that I am not suggesting that they will.)

ETA: Also note - the real question is how much is "priced in" to current stock prices (and perhaps real estate prices). Do they cool off, then resume a more sustainable growth pattern? Or do things roll over (in terms of real estate) along with another big leg down in equity prices?

ETA2: It would be useful when people post about their local real estate conditions that they give some kind of indication of where that is!

[GravitySucks]

Noticed a lot of signs staying up longer in my neighborhood but Realtor says all of them are Pending. Sales still strong.

Classic rust belt suburb. Things never went up huge, never goes down. Last couple years finally got house prices to meet inflation after years of barely moving.

[CaptTom]

Prices won't fall immediately. There will be more inventory, more due diligence, fewer sight-unseen purchases, fewer cash offers, fewer over-asking-price bids, that sort of thing. And, yes, a good indication is when the "For Sale" signs stay up longer.

I think it's safe to say at this point that would-be sellers who waited have missed the peak. Buyers are probably wise to wait, or at least not make a panic purchase. Beyond that, my crystal ball starts to get cloudy.

[tmm99]

Down in Ontario, Canada. Maybe 15% down from the high from last fall? Could even be 20% My old real estate agent called it "free fall" and it seems to be continuing... My house was more then twice as worth in 5 years at one point, and too many people were priced out of the market, so this is not a bad thing for a lot of people.

Tons of inventory (flooded) and nobody seems to be buying now, all waiting to see if it will come down some more. The kind of house that sold for $780K last summer is for sale at $650K with no bites...

[HarryHawk]

Just saw in the news that the White House would like to implement a nationwide set of building codes. YOu can be if implemented, it will increase the cost, time and complexity of new construction.