For the Real Estate Drop in sales and price Naysayers HOLD ONTO YOUR HATS

[Danger Dave]

 

[Orange Juice]

I see a lot of empty retail space behind those reflective windows. They can’t all be making the mortgage payments.

 

[Orange Juice]

But not everyone is hurting.

 

[530RL]

https://www.bloomberg.com/news/live-blog/2023-05-05/us-employment-report-for-april

 

[shintoooo]

. This is so good lol

Eric D'Alessandro on Instagram: "“Rent Forever”"

509K likes, 12K comments - ericdalessandro on April 11, 2023: "“Rent Forever”"

www.instagram.com

 

[LargeOrangeFont]

. This is so good lol

Eric D'Alessandro on Instagram: "“Rent Forever”"

509K likes, 12K comments - ericdalessandro on April 11, 2023: "“Rent Forever”"

www.instagram.com

I think that is going on my Channel playlist for this weekend.

Fuck theses little muffins

 

[Flatsix66]

Mortgage guys: With some of the banking issues are banks making it harder to get loans, less willing to lend? Construction loans in particular.

 

[Sportin' Wood]

This dead cat bounce has got some lift in our region. I thought I would share what I am seeing up here in Big Sky Country.

I think this spring season is interesting in Montana. A tale of two sellers. Priced correctly (reasonably) and they are selling quickly. Unrealistic expectations and they are sitting. Once they sit on the market, the buyers perceive a lack of value and if the seller wants to sell, they have to lower significantly to reestablish interest.

Lots of pending and under-contract ads on Zillow. The market is busy.

We are still shopping square foot prices. I've looked at two this week.

The first was on three acres, with a shop and 3200 square feet. Needs a rehab, weeks away from foreclosure, very rural area. $147 a sq ft. It's been on the market for a long time and has seen multiple price reductions. I think the buyers are all waiting to gnaw on the bones and wait for foreclosure. I got cold feet because it is maybe more rural than we want to deal with. If we wanted to sell it it would take a prepper with some money and a box of tin foil.

The second one we looked at this afternoon, just went on the market today, I feel pretty strongly it will be sold tomorrow if not by tonight. $177 a square foot, 2800 square feet. Amazing view of Flathead Lake. The view is top-notch. It needs updating but the house is solid. It has two nonstarters for me. The lot is not big enough to support a shop build and the master ensuite is terribly small. I think my RV has a bigger shower. No room to solve that issue within reason.

Edit: View House got an offer at the open house, they are holding out for any additional offers until Monday at 5pm. As suspected it will be under contract the first 48 hours.

I think there are some deals to be had right now, but people are getting the FOMO again. I'm not sure who is buying this stuff, but both agents told me this week that it is almost 100% out-of-area money coming into this market. It does not matter if it is $5M or $250K

Most of the stuff I look at shows very well on Zillow, but when you look at it in person it i not even close. In this area, you also have to be careful of the neighborhoods. Last week I looked at a property for $144 a square and it was a dump. The water supply was a spring in the back of the property surrounded by cows. In most counties permits are limited to electrical service, water well, and septic.

The true test will be the house my brother just finished in CDA. It went on the market today at $1.9M. It is a nice place, close to town on an acre, brand new build. We'll see how long it takes to sell.

6345 E Alina Dr, Coeur D Alene, ID 83814 | Zillow

6345 E Alina Dr, Coeur D Alene ID. The Zestimate for this property is $1,750,000, which has decreased by $10,723 in the last 30 days.The Rent Zestimate for this property is $6,225/mo, which has increased by $21/mo in the last 30 days.

www.zillow.com

 

[Sportin' Wood]

An observation that might be worth discussion for those in the RE industry.

We don't have a network up in Montana. The culture up here is not like many in this community would be used to. The people are split into factions. Multi-generational Montanian who is happy with a small tight network of family. Outsiders who don't want to spook the cattle. Hermits who hate people also fall into the mix. As a result, we don't have an agent. We bought our last house from the owner without agents and it was the best buying experience ever.

I've been experimenting with RE agents and have made an observation.

The RE agents I have interacted with seem to have benefited too long on picking up all the fruit that is falling from the tree. Not one of these listing agents has asked us a single qualifying question. They just open the place up and let us explore around people's homes. They seem to know a buyer will fall from the tree and they will pick up the easy commission with some paperwork.

This tells me that agents are not yet worried about a coming housing crash in this area.

The only question I have been asked is are you from here? I suspect they want out-of-area buyers and don't want to be a buyer's agent.

It seems really odd to me that you would not ask some qualifying questions.

• Are you pre-approved, or a cash buyer?
• What are you going to do with your current home? Sell it or rent it?
• If this house is not "The One" what does "The One" look like?
• What do you like or dislike about this house?
• Do you have an agent you are working with?

What do you RE pros think? Lack of acumen, or are they good at reading the room and have correctly identified we are assholes?

I've even opened the door to that conversation and the agents seem to be distracted.

 

[LuauLounge]

I know some RE agents that work every lead, rumor, introduction, etc and sell a ton of houses every year and have for the last 40 years. I used one in 1982 to sell a house that will list my current house in the next few months.

 

[Sportin' Wood]

I know some RE agents that work every lead, rumor, introduction, etc and sell a ton of houses every year and have for the last 40 years. I used one in 1982 to sell a house that will list my current house in the next few months.

My Mom got her RE license in 1973 and still has it. Talking to her this morning she says that agents have no clue nowadays on how to build a network. She still gets calls to sell houses she has sold multiple times.

 

[NicPaus]

There are a lot of worthless agents that get a few listings by luck.

I would say 75-100 to 1 in the Southbay. There are so many real estate agents here. But not that many good ones. There spouse must support the household or they have a second job.

I work with a few on a regular basis.

 

[77charger]

There are a lot of worthless agents that get a few listings by luck.

I would say 75-100 to 1 in the Southbay. There are so many real estate agents here. But not that many good ones. There spouse must support the household or they have a second job.

I work with a few on a regular basis.

I’ve known some who became”real estate” agents but have barely sold anything. And I know some who are hustlers and constantly selling and have no problem getting listings while others think the work drops into their laps.

 

[NicPaus]

I’ve known some who became”real estate” agents but have barely sold anything. And I know some who are hustlers and constantly selling and have no problem getting listings while others think the work drops into their laps.

My first house I owned. I fixed it up and did for sale by owner. You want to meet a thousand agents try it Lol. A lot of them had never even had a listing. My Realtor I used to buy it had passed away. Hindsight I should of never sold my first house or any of the houses. Live and learn.

I have now been working with my current realtor for 18 years. Few other top realtors I work for occasionally. But majority of the realtors I have worked for or with I don't answer the phone.

 

[77charger]

My first house I owned. I fixed it up and did for sale by owner. You want to meet a thousand agents try it Lol. A lot of them had never even had a listing. My Realtor I used to buy it had passed away. Hindsight I should of never sold my first house or any of the houses. Live and learn.

I have now been working with my current realtor for 18 years. Few other top realtors I work for occasionally. But majority of the realtors I have worked for or with I don't answer the phone.

My parents sold a couple houses in 80s by owner. It worked out well. I’m sure a 1000 would come in just to do the paperwork and take their percentage for doing nothing too.

 

[Orange Juice]

The reason I use an agent, is so they can negotiate the deal. If there’s to negotiation, I by -pass the agent, and use an attorney.

I’m done moving, with a cabin in Flagstaff, and a home in NE Phoenix.

What I see being built are not Single family detached homes. Lots of apartments and condos. If you want a property to store a boat on, it’s probably pushing $1M. But then again, a new Eliminator can easily cost $200k, so it kinda of equals out.

I would certainly need some inheritance to start my life over again.

 

[Vib]

For a few of our commercial clients we are negotiating lease to own scenarios for a few years until lending gets stabilized again. I read that currently about 14% of 'pre-approved' commercial loans are closing!

I have never been a fan of bankers!

 

[Sportin' Wood]

I found a lead on one today that looks interesting, it is not listed. Flier in the grocery store (FSBO). House is a wreck. $139 a square foot. Across the street from the lake super nice area. Pretty sure the neighbors will be happy if these people sell. It has a lake view.

I feel like I'm a better agent than the agents in this area. Angie is quick with the research she got all the dirt in 20 minutes of Google search. Looks like a reverse mortgage that is converting to adjustable. Could be messy.

 

[Gonefishin5555]

I found a lead on one today that looks interesting, it is not listed. Flier in the grocery store (FSBO). House is a wreck. $139 a square foot. Across the street from the lake super nice area. Pretty sure the neighbors will be happy if these people sell. It has a lake view.

I feel like I'm a better agent than the agents in this area. Angie is quick with the research she got all the dirt in 20 minutes of Google search. Looks like a reverse mortgage that is converting to adjustable. Could be messy

They probably never put a penny in to it. Good luck and bring your paint brush as they say

 

[LargeOrangeFont]

I found a lead on one today that looks interesting, it is not listed. Flier in the grocery store (FSBO). House is a wreck. $139 a square foot. Across the street from the lake super nice area. Pretty sure the neighbors will be happy if these people sell. It has a lake view.

I feel like I'm a better agent than the agents in this area. Angie is quick with the research she got all the dirt in 20 minutes of Google search. Looks like a reverse mortgage that is converting to adjustable. Could be messy.

Messy is good if you can be a quick and easy solution.

 

[Sportin' Wood]

They probably never put a penny in to it. Good luck and bring your paint brush as they say

I did a bunch of research this evening. The owner has had it for a lifetime. Kind of sad to be honest, he seems to have been a big part of the community for years. I'm interested in talking to him.

The square footage is suspect, I think they just kept adding on over the years. Permits in this area are rarely required. That makes rehab a bit interesting but does allow more flexibility in the process because you don't have an inspector breathing down your neck.

This will take more than paint. Not sure what I will find, but it is fun doing the research.

EDIT 5/16/23 Talked to the homeowner today. Smart guy. He seems like the kind of old guy you want to know. Not a distressed sale at all, he pulled the money for a quick flip on another property. He's been in the home for over 20 years. It's just too damn big for an old single guy. He is building another home nearby. It was vacant for two years, so that explains why it looks beat down.

I suspect the flier was to help him determine the demand from locals, he is well aware that out-of-area buyers are buying up almost anything. He seems a bit of a hoarder so he told me he would call me in two weeks to let me come take a look. I bet he lists it within two weeks at a higher price than his flier, but we will see. The guy seems like an old-school hustler. Maybe I'll make a new friend if nothing else.

 

[monkeyswrench]

An observation that might be worth discussion for those in the RE industry.

We don't have a network up in Montana. The culture up here is not like many in this community would be used to. The people are split into factions. Multi-generational Montanian who is happy with a small tight network of family. Outsiders who don't want to spook the cattle. Hermits who hate people also fall into the mix. As a result, we don't have an agent. We bought our last house from the owner without agents and it was the best buying experience ever.

I've been experimenting with RE agents and have made an observation.

The RE agents I have interacted with seem to have benefited too long on picking up all the fruit that is falling from the tree. Not one of these listing agents has asked us a single qualifying question. They just open the place up and let us explore around people's homes. They seem to know a buyer will fall from the tree and they will pick up the easy commission with some paperwork.

This tells me that agents are not yet worried about a coming housing crash in this area.

The only question I have been asked is are you from here? I suspect they want out-of-area buyers and don't want to be a buyer's agent.

It seems really odd to me that you would not ask some qualifying questions.

• Are you pre-approved, or a cash buyer?
• What are you going to do with your current home? Sell it or rent it?
• If this house is not "The One" what does "The One" look like?
• What do you like or dislike about this house?
• Do you have an agent you are working with?

What do you RE pros think? Lack of acumen, or are they good at reading the room and have correctly identified we are assholes?

I've even opened the door to that conversation and the agents seem to be distracted.

I think the RE network thing is old school, and lost in many places. The agent we bought this house from had been up here for years. He asked the questions that made sense: what are you looking for, what do you want to spend, how much work are you comfortable with?
We met him twice. Once to look around, two weeks later to show us a house we missed and make an offer.
He sends a card every Christmas.
Calls me up a week before our anniversary to "remind" me...and see how things are.
We've been here 11 years. He should have retired by now, but if I were to sell, I wouldn't hesitate to call him. Must be 500 agents up here now, but we'll see how long they last. It's easy to sell when everyone is buying.

 

[OldSchoolBoats]

Mortgage guys: With some of the banking issues are banks making it harder to get loans, less willing to lend? Construction loans in particular.

There hasn't been any change in the availability of credit for mortgages at this point. As long as you fit in the guidelines a construction loan is possible, all day.

 

[pronstar]

IMHO commercial lending is more impacted than consumer lending at this point.

 

[530RL]

IMHO commercial lending is more impacted than consumer lending at this point.

When you’re used to 3 percent, 8 percent just doesn’t pencil.

 

[bonesfab]

they are both going to shit the bed. But office space is going to really go bad. Commercial where house is out of control rent wise. Not quite doubled in the last 10 years. 1.25 - 1.30 for 10k where house. The next few years are going to be interesting.

 

[evantwheeler]

I did a bunch of research this evening. The owner has had it for a lifetime. Kind of sad to be honest, he seems to have been a big part of the community for years. I'm interested in talking to him.

The square footage is suspect, I think they just kept adding on over the years. Permits in this area are rarely required. That makes rehab a bit interesting but does allow more flexibility in the process because you don't have an inspector breathing down your neck.

This will take more than paint. Not sure what I will find, but it is fun doing the research.

EDIT 5/16/23 Talked to the homeowner today. Smart guy. He seems like the kind of old guy you want to know. Not a distressed sale at all, he pulled the money for a quick flip on another property. He's been in the home for over 20 years. It's just too damn big for an old single guy. He is building another home nearby. It was vacant for two years, so that explains why it looks beat down.

I suspect the flier was to help him determine the demand from locals, he is well aware that out-of-area buyers are buying up almost anything. He seems a bit of a hoarder so he told me he would call me in two weeks to let me come take a look. I bet he lists it within two weeks at a higher price than his flier, but we will see. The guy seems like an old-school hustler. Maybe I'll make a new friend if nothing else.

It sounds like 2ff has a brother in Montana

 

[Orange Juice]

they are both going to shit the bed. But office space is going to really go bad. Commercial where house is out of control rent wise. Not quite doubled in the last 10 years. 1.25 - 1.30 for 10k where house. The next few years are going to be interesting.

Dynamics are changing. Faster than the last 100 years. . ( exponentially)

I

 

[Sportin' Wood]

It sounds like 2ff has a brother in Montana

Very much the same type of person from my limited interactions with both. Friendly and willing to help the community and very good at hustling a deal.

This week's SWood and Associates NorthWest Montana RE report:
Anything listed last weekend with a reasonable price per sq ft is now under contract. Inventory of overpriced manufactured homes built in 1974 and unrealistic amateur investor properties continue to offer limited and disappointing opportunities to overpay.

We've not seen a meaningful depreciation in the used truck market, labor continues to be in high demand and the tourist have not even come to town yet.

However, the foreclosure market seems to be positioned to make a return. Maybe another year until the gale-force winds hit, but there are deals out there if you want to dig around.

Stay tuned for SWood's Flathead Lake and launch ramp reports, Lake is almost back up to the proper elevation to dock boats.

 

[LargeOrangeFont]

This won’t help the collapse.

New home starts increase in April in line with expectations

Housing starts rose 2.2% to a seasonally adjusted annual rate of 1.401 million units in April.

finance.yahoo.com

 

[Orange Juice]

 

[530RL]

Today’s data….

https://www.pmi.spglobal.com/Public/Home/PressRelease/fb16b048c1ca4d659e136ae0c52faaa2

 

[OldSchoolBoats]

Here is some housing data released today


23-May-2023 10:00:01 AM - US APRIL SINGLE-FAMILY HOME SALES 0.683 MLN UNIT ANN. RATE, (CONS 0.665 MLN) VS MARCH 0.656 MLN UNIT RATE (PREV 0.683 MLN)

23-May-2023 10:00:02 AM - US APRIL MEDIAN SALE PRICE $420,800, -8.2% FROM APRIL 2022 ($458,200)

23-May-2023 10:00:01 AM - US APRIL HOME SALES NORTHEAST -58.6%, MIDWEST +11.8%, SOUTH +17.8%, WEST -9.1%

3-May-2023 10:00:01 AM - US APRIL SINGLE-FAMILY HOME SALES +4.1% VS MARCH +4.0% (PREV +9.6%)

23-May-2023 10:00:01 AM - US APRIL NEW HOME SUPPLY 7.6 MONTHS' WORTH AT CURRENT PACE VS MARCH 7.9 MONTHS

23-May-2023 10:00:01 AM - US HOMES FOR SALE AT END OF APRIL 0.433 MLN UNITS VS MARCH 0.432 MLN UNITS

 

[EmpirE231]

place around the corner just sold for 2.5M in about a week.

The downside is that it sold to an inpatient teen drug rehab place....

 

[530RL]

Here is another opinion.

This is consistent with the builders we finance in California, Arizona and Nevada.

Homebuyers gobble up new homes in April amid inventory shortages

New home sales jumped 4.1% to a seasonally adjusted rate of 683,000 units last month from the revised March rate of 656,000.

www.yahoo.com

 

[LargeOrangeFont]

place around the corner just sold for 2.5M in about a week.

The downside is that it sold to an inpatient teen drug rehab place....

That’s a bummer

 

[EmpirE231]

That’s a bummer

Gotta love CA politics. State policies have made all zoning laws pretty much obsolete

 

[hallett21]

Stuff seems to keep moving around us. The latest is a finished gut job across the street from a K-6 public school. The home turned out nice and my guess is they have 300-350k all in. I’d never want to live across the street from a school but I guess if you went to work at 6-7 and came home around 4-5 it wouldn’t bother you?

https://www.redfin.com/CA/Woodland-Hills/4955-San-Feliciano-Dr-91364/home/4197554

How about a sub 1k ft home lol.

https://www.redfin.com/CA/Woodland-Hills/22021-Galvez-St-91364/home/4186373

 

[hallett21]

Gotta love CA politics. State policies have made all zoning laws pretty much obsolete

I thought there was a work around on zoning for rehabs. Something about technically being a room to rent vs an institution setting up a business.

I do know that there are so many in Malibu that the septic guys have to pump once a month. Apparently all of the detoxing that goes into a septic tank makes them inoperable. So now they’re holding tanks that need yo be pumped weekly or monthly. All of the natural bacteria are murdered from the drugs and booze going down the drains.

 

[RiverDave]

place around the corner just sold for 2.5M in about a week.

The downside is that it sold to an inpatient teen drug rehab place....

I firmly believe that should be illegal... It can affect values of surrounding houses and they have to disclose if there is one in the neighborhood (depending on your local RE rules / laws)

RD

 

[Englewood]

I firmly believe that should be illegal... It can affect values of surrounding houses and they have to disclose if there is one in the neighborhood (depending on your local RE rules / laws)

RD

Only gonna get worse...All this "housing is unaffordable" talk has created governments who are willing to look past zoning to please those that cannot afford it.

 

[RiverDave]

Only gonna get worse...All this "housing is unaffordable" talk has created governments who are willing to look past zoning to please those that cannot afford it.

It's terrible.. .

RD

 

[hallett21]

Only gonna get worse...All this "housing is unaffordable" talk has created governments who are willing to look past zoning to please those that cannot afford it.

Unfortunately it’s the route I think my wife and I are headed. With a finished ADU we get 3x our mortgage.

Not sure what else we should do? Can’t sell it with that kind of return.

 

[EmpirE231]

I thought there was a work around on zoning for rehabs. Something about technically being a room to rent vs an institution setting up a business.

I do know that there are so many in Malibu that the septic guys have to pump once a month. Apparently all of the detoxing that goes into a septic tank makes them inoperable. So now they’re holding tanks thank need yo be pumped weekly or monthly. All of the natural bacteria are murdered from the drugs and booze going down the drains.

We'll find out... I already have an email out to our councilman and it sounds like the city is already getting lots of pushback.

This goes hand in hand with the ADU BS.... all ruining neighborhoods one at a time.

any other sane state would have zoning blocks in place... like we did not that long ago...

 

[Englewood]

Unfortunately it’s the route I think my wife and I are headed. With a finished ADU we get 3x our mortgage.

Not sure what else we should do? Can’t sell it with that kind of return.

Don't blame you one bit...I may do the same.

 

[hallett21]

We'll find out... I already have an email out to our councilman and it sounds like the city is already getting lots of pushback.

This goes hand in hand with the ADU BS.... all ruining neighborhoods one at a time.

any other sane state would have zoning blocks in place... like we did not that long ago...

Agreed. I just think the cats out of the bag on the ADUs. Permitted structures are approved. Maybe they can walk back the “duplex” nature of them. But no landlord is going to care.

 

[LargeOrangeFont]

We'll find out... I already have an email out to our councilman and it sounds like the city is already getting lots of pushback.

This goes hand in hand with the ADU BS.... all ruining neighborhoods one at a time.

any other sane state would have zoning blocks in place... like we did not that long ago...

Same thing happend to my old house in South OC. City can’t do anything. They turned my old house into a duplex.

 

[LargeOrangeFont]

Unfortunately it’s the route I think my wife and I are headed. With a finished ADU we get 3x our mortgage.

Not sure what else we should do? Can’t sell it with that kind of return.

Do it.

 

[530RL]

I firmly believe that should be illegal... It can affect values of surrounding houses and they have to disclose if there is one in the neighborhood (depending on your local RE rules / laws)

RD

It does affect values but unfortunately to limit it in a reasonable way in most jurisdictions, that will require a change in federal law.

Fair Housing Laws require that land use regulation not be tougher on people with certain disabilities than on the general population. Due to these federal laws, facilities whether it be dementia, older care or drug rehabilitation are considered "residential" units as long as those being treated at that location, reside at that location.

 

[LargeOrangeFont]

It does affect values but unfortunately to limit it in a reasonable way in most jurisdictions, that will require a change in federal law.

Fair Housing Laws require that land use regulation not be tougher on people with certain disabilities than on the general population. Due to these federal laws, facilities whether it be dementia, older care or drug rehabilitation are considered "residential" units as long as those being treated at that location, reside at that location.

Translation… be poor elsewhere.