The home sales slump in the U.S. continues: Last month was the slowest May for existing home sales since 2009.
Existing home sales in May fell 0.7% compared to the same month last year. Measured monthly, sales were up slightly, 0.8%, from the month before — but that marks an increase from the slowest April for existing home sales in 16 years.
I think one only has to look at what is happening in areas of Arizona which has many homes sitting on the same street for sale, dropping their prices, staying on the market for over 100 days. Their average is down 13%+ sales, particularly in many of the suburban areas. On the rent side, landlords are offering 1 month free rent, lots of incentives.
In CA, add the cost factor of trying to find reasonably priced insurance. My barber says his friend is on his 6th home insurance company after being dropped…for no reason (CA fires.)
A lot of the problem across the country was the buying in 2022 after COVID when building stopped, bought too high. Now they are losing value and can’t get rid of them at the price they want.
There’s like 5 houses for sale on my street in socal
There’s no future to look forward to and strive for until the virus that has taken over this country is cut out
there are 83% more condo sellers than buyers in the market.
Still, home prices have continued to rise,
There seems to be some sort of timeline problem, it’s even often reported on, but apparently nobody is trying to fix it?!
There’s not much to “fix” unfortunately. We just got out of a really hot real estate market with people routinely offering 50k over asking. Everyone who needed to move likey did so but sellers who were late to the party still expect to get those crazy offers.
But people don’t buy when there’s a recession on the way and these sellers are stuck. Soon, “investors” will realize they were late to the party and they’ll panic sell before it loses more value.
And because we’re in a recession, banks will buy the houses and rent will go up
Some sellers have realized that this market is not the covid market anymore. Those that have not have seen the houses sit for 9+months. In Texas, that’s crazy to me given the hight cost of insurance and property taxes. In real terms, a 400k house costs ~$5000/ year to insure, and costs ~$7000 per year in property taxes so if it sits for 6 months, that costs you a MINIMUM of $6k even if the mortgage is paid off.
We just closed on our new (to us) place last week and while the seller was more realistic about price, they insisted we pay for everything, appraisal, survey, all closing costs which was not how it was 8 years ago when we bought our first house.
I bought a condo in 2009/2010 and the market is way crazier now. Back then it felt very…human? This time around, the whole process selfish and greedy with everyone trying to take advantage of you on both sides.
I hate how the whole process works.
We had one seller essentially manipulate us by telling us there were multiple offers when there weren’t, told no less than three people that they had the house inspected to make sure it was in good shape then gaslight us about that and claim we were lying when we asked for the report. Then they ignored our contract terms, then refuse to make repairs or discount the house after significant work was required when we had the house inspected. Then when we canceled our contract because the option period was about to expire (after offering to extend it if they got the forms back to us before the deadline) because they refused to negotiate on the price or repairs, they asked why we backed out of the deal.
THEN THESE FUCKERS WOULDN’T SHARE THE INSPECTION REPORT WE PAID FOR WITH THE NEXT PROSPECTIVE BUYER UNTIL THEY WERE UNDER CONTRACT. Which is not how that is supposed to go.
The new buyer reached out to our agent and asked about what was up and if we would share the report to which I said of course, here is everything we went through and how these people behave, lowball the shit out of them.
There’s not much to “fix”
Basic supply and demand says otherwise.
But what you are saying is that it’s just latency?Yeah, it’s just a weird period where things haven’t caught up and there’s nothing any authority could do to force it to catch up
That said, don’t expect prices to go down much. Outside of a total market crash, prices always rise
Oh also worth noting that housing is a different kind of beast in the way it “handles” supply and demand. If you can’t afford to buy, you can still rent. Banks will lend as much as possible because don’t care if prices get crazy - they benefit more than a single homeowner. And if they have to foreclose on you? Well, just add it to the bank portfolio and rent it out
what? everyone doesn’t just have $70K sitting around for a down payment on a house? color me shocked
It has more to do with interest rates and home prices than down payment though you aren’t wrong about that being a burden. A $200k house on a 5% down fha loan requires about $10k in down payment and another $10k mortgage costs. Then when it used to be about 3% interest rates, that would cost you about $1000/month in P&I plus insurance and taxes.
That world is gone though. A basic house in the houston metroplex now goes for $300k at 7% interest so while the down payment has only gone up $5k the rest of it has gone up ~100% meaning a basic house is now a $2000/month expense.
That is napkin math but if you do the numbers for real it is probably pretty close.
