No, RD has the bigger boat disease, strikes the day you buy the first boat.
Do you foresee 3-4% rates being a thing of the past? Genuinely curious and like to hear others opinions.
I think you will see rates come back down in a few years from now. The Fed will likely hammer the interest rates hard for the next 18-24 months until inflation slows tf down. Unfortunately to do that they will put the economy into a mini depression. Then they will have to drop rates back to 0% to resuscitate the economy back to life in 2025.
www.housingwire.com
Just out today on a day we saw rates fall. 30 Year with no point is at 5.375% right now, not terrible.
Mortgage delinquency rate falls to historic low - HousingWire
The overall mortgage delinquency rate dropped five basis points to 2.75% in May, according to Black Knight. That's the lowest level ever recorded.
Considering a 30yr was 2.8% about 6-7months ago…. I’d say it’s pretty bad lol. Now if you want to talk historical average, sure… not bad. But historically a shit shack didn’t cost a million dollars either.
Ten year has dropped from 3.48 to 2.97 over the last few weeks.Just out today on a day we saw rates fall. 30 Year with no point is at 5.375% right now, not terrible.
Mortgage delinquency rate falls to historic low - HousingWire
The overall mortgage delinquency rate dropped five basis points to 2.75% in May, according to Black Knight. That's the lowest level ever recorded.
Rates definitely hit a ceiling. We will see a correction in the stock market that is just starting. Money will flow into bonds as a safe haven and drive yields down. Mortgage rates should settle in the 3.75% - 4.25% range over the next 12 months, which is super healthy for the market.Ten year has dropped from 3.48 to 2.97 over the last few weeks.
Close enough!!So you don’t like my month-old stats?
Interesting to see the pressure they are exerting on their “partners”. I just saw a price increase over 22% from one company. This is not going to go over very well.This from one of our builders.
In a nut shell we have to give back 10% (even though our costs continue to rise) or they put us out to bid.
Trade Partners,
Market Update
For those of you that were able to attend our trade partner meeting a couple weeks ago, thank you for taking time out of your day to listen to our plans and goals as we navigate this ever changing market. As mentioned in that meeting our ability to pass along increases to the home buyers was already very limited and our ask to you as our direct customer was to simply hold the line. After that meeting the amount of increase requests we have received from many of you did not slow down which is quite disappointing. We do understand that your suppliers are still pushing through increases resulting in your company passing them to us. We simply cannot continue passing these increases to our homebuyers. Our homebuyers respond and message “no” in two different two ways. First they stop purchasing our homes. Secondly, those that have purchased, cancel.
Below is the current chart of the sale data for the Inland Empire from the Ryness Report. You will note that sales are down 27% with cancelations up 141% from this time last year. As you can see, our homebuyers are telling us “no”. In order for us to maintain and keep our current homebuyers and find new ones to say “yes”, we along with other builders in the market and nationally are starting to offer incentives and discounts. (https://www.bloomberg.com/news/articles/2022-06-17/will-home-prices-fall-builders-offer-discounts-as-mortgage-rates-rise). It is not sustainable for us to continue taking cost increases while we are needing to decrease prices just to make sales. We are now at the point where we need to push these same decreases we are being forced to accept as the market changes back down through the supply chain. This unfortunately means they need to go through you.
We need to reduce our house costs by at least 10% in order maintain affordability
This request needs to be treated with the same level of importance as your company’s price increases requests have been for the last 2 years. Trade Partner expectations have been of Richmond to respond to your increases requests with urgency and quick implementation. Our expectation for you is the same. The response Richmond is looking for is for your reply to this request accepting the 10% decrease to your current costs. From there we will work with you directly as to how this will be implemented and the effective phase forward just like we processed increase requests. If Richmond cannot collectively reduce our house costs by 10% as soon as possible, then production paces will be slowed and some communities potentially paused. If you do not accept this cost reduction request, Richmond will be forced to take the work out to bid in an effort to get the costs in alignment in order to keep building homes.
Trade Partners
We have partnered with you in an extremely volatile market for the last couple of years processing your increases quicker than contractually required. We did that because we were partnering with you to implement these increases as you needed them. The reality of it was, if you didn’t get the increases quicker than the contract allowed it would put a financial burden on your company or worse, put you out of business. As your partner, understanding the sensitivity of your pricing requests, Richmond acted in good faith and in the spirit of partnership by responding quickly and effectively. We both rode this wave up together as partners and ask that we continue as partners together as the market adjusts down. We do not want to replace any of you on our jobs. Difficult business decisions may need to be made if we cannot get our costs in alignment with market conditions. We do hope that we can partner together through this ever changing market.
We look forward to hearing from you quickly on this request. As always, please reach out to us as needed.
Tri-point and lennar are still cranking, is Richmond American pulling back on new starts too or just asking subs to take a haircut?This from one of our builders.
In a nut shell we have to give back 10% (even though our costs continue to rise) or they put us out to bid.
Trade Partners,
Market Update
For those of you that were able to attend our trade partner meeting a couple weeks ago, thank you for taking time out of your day to listen to our plans and goals as we navigate this ever changing market. As mentioned in that meeting our ability to pass along increases to the home buyers was already very limited and our ask to you as our direct customer was to simply hold the line. After that meeting the amount of increase requests we have received from many of you did not slow down which is quite disappointing. We do understand that your suppliers are still pushing through increases resulting in your company passing them to us. We simply cannot continue passing these increases to our homebuyers. Our homebuyers respond and message “no” in two different two ways. First they stop purchasing our homes. Secondly, those that have purchased, cancel.
Below is the current chart of the sale data for the Inland Empire from the Ryness Report. You will note that sales are down 27% with cancelations up 141% from this time last year. As you can see, our homebuyers are telling us “no”. In order for us to maintain and keep our current homebuyers and find new ones to say “yes”, we along with other builders in the market and nationally are starting to offer incentives and discounts. (https://www.bloomberg.com/news/articles/2022-06-17/will-home-prices-fall-builders-offer-discounts-as-mortgage-rates-rise). It is not sustainable for us to continue taking cost increases while we are needing to decrease prices just to make sales. We are now at the point where we need to push these same decreases we are being forced to accept as the market changes back down through the supply chain. This unfortunately means they need to go through you.
We need to reduce our house costs by at least 10% in order maintain affordability
This request needs to be treated with the same level of importance as your company’s price increases requests have been for the last 2 years. Trade Partner expectations have been of Richmond to respond to your increases requests with urgency and quick implementation. Our expectation for you is the same. The response Richmond is looking for is for your reply to this request accepting the 10% decrease to your current costs. From there we will work with you directly as to how this will be implemented and the effective phase forward just like we processed increase requests. If Richmond cannot collectively reduce our house costs by 10% as soon as possible, then production paces will be slowed and some communities potentially paused. If you do not accept this cost reduction request, Richmond will be forced to take the work out to bid in an effort to get the costs in alignment in order to keep building homes.
Trade Partners
We have partnered with you in an extremely volatile market for the last couple of years processing your increases quicker than contractually required. We did that because we were partnering with you to implement these increases as you needed them. The reality of it was, if you didn’t get the increases quicker than the contract allowed it would put a financial burden on your company or worse, put you out of business. As your partner, understanding the sensitivity of your pricing requests, Richmond acted in good faith and in the spirit of partnership by responding quickly and effectively. We both rode this wave up together as partners and ask that we continue as partners together as the market adjusts down. We do not want to replace any of you on our jobs. Difficult business decisions may need to be made if we cannot get our costs in alignment with market conditions. We do hope that we can partner together through this ever changing market.
We look forward to hearing from you quickly on this request. As always, please reach out to us as needed.
Wondering what effect the Feds QT will have on the bond market. The Fed was supposed to start QT a couple weeks ago but haven’t heard wether they did or not.
That statement is not entirely accurate. In fact California Prop 13 Tax Rates are one of the few things keeping the rest of us people who haven’t moved from leaving the state. For instance the house we purchased in 1996 for $195K currently is valued at $1.2M and has a yearly property tax of $3,500. If the same scenario was held in Texas my taxes would be approx $12,000 yearly as they can revalue your house annually.
Not quite sure what you are asking here?
If prop 13 is abolished I'd expect a bunch of blue hairs that can no longer afford their home and with not much reason to live resort to. taking up arms
This , this , this...there's soooo much money waiting on the sidelines...everyone has equity and money. Hell even if my OC home dropped value 20% or more I still would have the equity to borrow against it and buy $600,000 + investment property and never touch my savings or investments...that wasn't the case in '08-'12...now days if houses corrected dramatically you'd have to compete with big money investors , PPP recipients , and whatever else they were giving away during covid...all those factors would still keep housing prices afloat...you want to kill the house values in Havasu? Have the city council ban short term rentals...
Back in 2007, Lennar pulled this crap on me. I was a C36 and they "Promised," Any "Partners" that reduced outstanding invoices would have the limited "opportunity" to win the contracts for a housing project in Diamond Valley between Temecula and Hemet. They owed us about $1.2M from the previous year and they had been about $800K late in the current year. Most of the outstanding payments were in negotiation regarding back charges that we felt were BS.This from one of our builders.
In a nut shell we have to give back 10% (even though our costs continue to rise) or they put us out to bid.
Trade Partners,
Market Update
For those of you that were able to attend our trade partner meeting a couple weeks ago, thank you for taking time out of your day to listen to our plans and goals as we navigate this ever changing market. As mentioned in that meeting our ability to pass along increases to the home buyers was already very limited and our ask to you as our direct customer was to simply hold the line. After that meeting the amount of increase requests we have received from many of you did not slow down which is quite disappointing. We do understand that your suppliers are still pushing through increases resulting in your company passing them to us. We simply cannot continue passing these increases to our homebuyers. Our homebuyers respond and message “no” in two different two ways. First they stop purchasing our homes. Secondly, those that have purchased, cancel.
Below is the current chart of the sale data for the Inland Empire from the Ryness Report. You will note that sales are down 27% with cancelations up 141% from this time last year. As you can see, our homebuyers are telling us “no”. In order for us to maintain and keep our current homebuyers and find new ones to say “yes”, we along with other builders in the market and nationally are starting to offer incentives and discounts. (https://www.bloomberg.com/news/articles/2022-06-17/will-home-prices-fall-builders-offer-discounts-as-mortgage-rates-rise). It is not sustainable for us to continue taking cost increases while we are needing to decrease prices just to make sales. We are now at the point where we need to push these same decreases we are being forced to accept as the market changes back down through the supply chain. This unfortunately means they need to go through you.
We need to reduce our house costs by at least 10% in order maintain affordability
This request needs to be treated with the same level of importance as your company’s price increases requests have been for the last 2 years. Trade Partner expectations have been of Richmond to respond to your increases requests with urgency and quick implementation. Our expectation for you is the same. The response Richmond is looking for is for your reply to this request accepting the 10% decrease to your current costs. From there we will work with you directly as to how this will be implemented and the effective phase forward just like we processed increase requests. If Richmond cannot collectively reduce our house costs by 10% as soon as possible, then production paces will be slowed and some communities potentially paused. If you do not accept this cost reduction request, Richmond will be forced to take the work out to bid in an effort to get the costs in alignment in order to keep building homes.
Trade Partners
We have partnered with you in an extremely volatile market for the last couple of years processing your increases quicker than contractually required. We did that because we were partnering with you to implement these increases as you needed them. The reality of it was, if you didn’t get the increases quicker than the contract allowed it would put a financial burden on your company or worse, put you out of business. As your partner, understanding the sensitivity of your pricing requests, Richmond acted in good faith and in the spirit of partnership by responding quickly and effectively. We both rode this wave up together as partners and ask that we continue as partners together as the market adjusts down. We do not want to replace any of you on our jobs. Difficult business decisions may need to be made if we cannot get our costs in alignment with market conditions. We do hope that we can partner together through this ever changing market.
We look forward to hearing from you quickly on this request. As always, please reach out to us as needed.
But Texas has no state income tax. Add both together and see where you come out.
We are in a van (bus) down by the River (Flathead) with a suitcase (a couple of bank accounts) Ready to buy. Closed Escrow on June 24th on the first house. Bought off-market without a realtor already has a full-time renter in it. There are already deals but not the collapsing kind of deals people want to happen.
