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Havasu Homes (single family)

paradise

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Concrete demand exceeds pre-Covid levels. Further increases in demand are expected as the trillion dollar infrastructure spending bill is implemented.

It is not just cement. Long lead times exist on many things all the while ports, rail, shipping, and trucking are doing strong volumes.

A cut in demand for most things would certainly be welcomed by many as Summit Karl points out for himself.

It remains just way too busy with limited ability to grow above current volumes given a lack of labor in America. We can’t support existing demand let alone growth for the economy.
Sure seems like a lot of capital from all the Covid handouts is still working it's way through the system (business and personal). Lot's of contractors buying material way in advance to get ahead of shortages and long lead times. Will be interested to see who get's left without a seat when the music stops. Once all that capital has been spent is there still this high demand? Will existing contracts be put on hold? Will it be manufacturers, wholesalers or retailers (contractors) that are left with all the excess product. Interesting times for sure.
 

LargeOrangeFont

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I definitely think the price will drop 40-50% of what the peak is ....easily...let's put this here to help prove me wrong later...less than 3 years they were 40% less than today.... keep saying those Cali exiters/retirees will prop up that pricing....I don't see it with rates and markets doing what they are...

View attachment 1124322

I’d love for that to happen, but doubt it will. There is so much money waiting on the sidelines.

It took until 2012 to get back to ~2002 pricing.

How long you think this 50% drop will take?
 

530RL

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Sure seems like a lot of capital from all the Covid handouts is still working it's way through the system (business and personal). Lot's of contractors buying material way in advance to get ahead of shortages and long lead times. Will be interested to see who get's left without a seat when the music stops. Once all that capital has been spent is there still this high demand? Will existing contracts be put on hold? Will it be manufacturers, wholesalers or retailers (contractors) that are left with all the excess product. Interesting times for sure.
Beats me. 🤷‍♂️🤷‍♂️🤷‍♂️
 

mbrown2

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I’d love for that to happen, but doubt it will. There is so much money waiting on the sidelines.

It took until 2012 to get back to ~2002 pricing.

How long you think this 50% drop will take?
I think within 3yrs we will see 40%...for this market in particular... Not saying all locations, but this is one of those seriously overvalued places like Boise....I remember 2008 very well when folks were saying there was too much demand, not enough inventory ...this will keep going.. I also remember one Havi lot we owned bought in 2003 for 55K and over the next 3 years tripled in value same lot in North Palo Verde area was 180-220 in 2007.....that same lot was worth 63K in 2011... So it took from 2007 where the market started to the crash in 2008 all the way to 2010-11 for the market to bottom out.... Rates are moving up faster much now; inflation is moving much faster now....Mortgage Credit Availability is at a long term low.....and if you look at any of the data around New Home, Existing Home you will find that peak was right 4th quarter of 2020, 1st quarter of 2021....but as 2021 dragged on so did mortgage applications....It may take 4 years from 2020 to see the bottom, it may happen faster....but one thing is clear we are not at the bottom and fiscal policy in place is not helping any landing soon.
 

COCA COLA COWBOY

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Areas with wages to support the the values for that area will not get hit that hard. Areas where typical wages do not support the current prices will get hit extremely hard.

We just started to really feel it about 2 weeks ago in San Diego County. The prices from 3 months ago are a thing of the past.

From what I am being told, Murrieta/Temecula, Palm Desert/Palm Springs/La Quinta are areas still moving quite well. Typically, metro areas are the first to increase and the first to decrease.

I am being told to expect .5% this month and another .5% increase in July. What this will equate in actual interest rate is yet to be determined, but get ready.

Also keep in mind, they are not foreseeing the recession until next year. You will feel it this year, but you'll really feel it next year!

For those in the construction industry...when real estate falls off, it usually takes approximately 12 months before you feel it in your industry. At least that is what I experienced in prior recessions.
 

COCA COLA COWBOY

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I think within 3yrs we will see 40%...for this market in particular... Not saying all locations, but this is one of those seriously overvalued places like Boise....I remember 2008 very well when folks were saying there was too much demand, not enough inventory ...this will keep going.. I also remember one Havi lot we owned bought in 2003 for 55K and over the next 3 years tripled in value same lot in North Palo Verde area was 180-220 in 2007.....that same lot was worth 63K in 2011... So it took from 2007 where the market started to the crash in 2008 all the way to 2010-11 for the market to bottom out.... Rates are moving up faster much now; inflation is moving much faster now....Mortgage Credit Availability is at a long term low.....and if you look at any of the data around New Home, Existing Home you will find that peak was right 4th quarter of 2020, 1st quarter of 2021....but as 2021 dragged on so did mortgage applications....It may take 4 years from 2020 to see the bottom, it may happen faster....but one thing is clear we are not at the bottom and fiscal policy in place is not helping any landing soon.
Approximately 2016/2017 I was looking to buy a home in Meridian Idaho...3/2 2200-2400SF were selling from $220,000-$240,000. Now I am seeing $700,000 to $750,000. I think your 40% estimate is right on target.
 

DLC

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A friend of ours was over the other day and she is pretty high up at a lending company that lends money on multi unit properties (apartment buildings and such) and I asked her how she was doing. First word out of her mouth was "horrible". She said higher interest rates and investor concern has majorly slowed their business. She said the investors are on the sideline afraid to buy until they see where this whole things goes.
Everyone is in a holding pattern to see what happens!

We are all …. Along for the ride!

why would anyone build PRIVATELY right now/ start a project? Way to many unknowns, unless your loan is locked in and your in a good job, costs can skyrocket!
 

DLC

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Areas with wages to support the the values for that area will not get hit that hard. Areas where typical wages do not support the current prices will get hit extremely hard.

We just started to really feel it about 2 weeks ago in San Diego County. The prices from 3 months ago are a thing of the past.

From what I am being told, Murrieta/Temecula, Palm Desert/Palm Springs/La Quinta are areas still moving quite well. Typically, metro areas are the first to increase and the first to decrease.

I am being told to expect .5% this month and another .5% increase in July. What this will equate in actual interest rate is yet to be determined, but get ready.

Also keep in mind, they are not foreseeing the recession until next year. You will feel it this year, but you'll really feel it next year!

For those in the construction industry...when real estate falls off, it usually takes approximately 12 months before you feel it in your industry. At least that is what I experienced in prior recessions.
In these areas there are a ton of service industry employees and they have to drive / travel to get to work to serve these well paid people…

prices go up Accross the board!!!
Everyone cuts back to save a buck, Rich & well paid people cut back and don’t like to waste cash just like everyone else.
 

rickym20

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Areas with wages to support the the values for that area will not get hit that hard. Areas where typical wages do not support the current prices will get hit extremely hard.

We just started to really feel it about 2 weeks ago in San Diego County. The prices from 3 months ago are a thing of the past.

From what I am being told, Murrieta/Temecula, Palm Desert/Palm Springs/La Quinta are areas still moving quite well. Typically, metro areas are the first to increase and the first to decrease.

I am being told to expect .5% this month and another .5% increase in July. What this will equate in actual interest rate is yet to be determined, but get ready.

Also keep in mind, they are not foreseeing the recession until next year. You will feel it this year, but you'll really feel it next year!

For those in the construction industry...when real estate falls off, it usually takes approximately 12 months before you feel it in your industry. At least that is what I experienced in prior recessions.
I work for a subcontractor in commercial construction. We had our first sign few weeks ago when investors put a freeze on a project that had 4 fair size buildings on them in San Diego . Was slated to start our part of the work early next month.


Haven’t seen too much of that since the last downturn. Hospitals , Schools and similar type well funded projects are still full steam ahead in San Diego at this point. Hopefully that continues but we are ready to adapt if needed.
 

TCHB

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I’m just wondering if it’s because of so much demand or they just don’t have enough drivers to move all this shit around, everybody I talk to is starving for drivers.
The issue that concerns me most is that with normal inflation, adjusting interest rates works.

Right now much of inflation is driven by supply shortages and fuel. I have 10 buyers for 2 Honda Accords, an extra 1 or 2% points on interst rates isn’t going to effect this inflation. Cost of fuel is embedded in everything we buy, interest rate hikes won’t effect this type of inflation.

Inflation is only going away until they either raise rates so sky high it literally kills every part of the the economy or supply and fuel comstraints return to pre-pandemic levels . Take your pic, which is more likely to happen
The past 15 years Americans were drunk with free credit. When I see a guy making a $100k a year buying a new truck for $100k something is not right.
 

2Driver

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The past 15 years Americans were drunk with free credit. When I see a guy making a $100k a year buying a new truck for $100k something is not right.

The first vacation house we ever rented in Havasu was back in 05. It was brand new and the guy had spent all his loan money to build it, plus his cash to furnish it. The only option to pay for basic landscaping was to put it on his credit card. 🤡

I doubt he stayed afloat 18 months when shit hit.
 

ONE-A-DAY

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Saw this yesterday……
CAD25229-3357-4B16-9549-DE16354B5501.png
 

Xtrmwakeboarder

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The past 15 years Americans were drunk with free credit. When I see a guy making a $100k a year buying a new truck for $100k something is not right.
My buddy approves these all day, every day. Most of them are much worse…
 

socal0487

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I wonder what kinds of problems $10 a gallon gasoline would bring?
Less vacations for people. All the STRs in Havasu dependent on income to pay for the second mortgage will feel the pinch
 

TCHB

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Weekends power demand drops about 20%. SCE has a pretty big FLEX program that shuts power down residential pools and other things when they get into days.
 

jet496

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People buy $100k trucks because they can’t live without $100k trucks.

There are plenty of $50k trucks that people refuse to lower themselves to purchase.
I just bought two Silverado 1500's @ $50k each. Crew cab, 6'6" bed & all the new electronics. Nice freaking trucks! I could never see paying $70 - 100k for a vehicle. They do nothin but depreciate but at least mine are making me money in the business. They won't be worth shit in 7 to 10 years. Be lucky to get $ 7500 for them at that point.
 

zhandfull

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Fed tightening going IN to a slowdown/recession. Don’t think we’ve ever seen this one.

They don’t have a choice with inflation out of control. I’m thinking the economy is hitting a wall with higher rates and quantitative tightening coming up.
 

TCHB

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Lets see if inventory reaches 350 in two weeks. I know a few people selling their vacation homes and will pay off their primary homes.
 

TCHB

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318 single family homes for sale as of today.
 

THE WIDGE

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Nearly 160 houses listed in last 30 days and 80 in last 2 weeks. Definitely an uptick from what I’ve been watching last few months. But really, how many buyers are there out there to buy a house for 1.3 that exactly 2 years ago was 709k, that scenario popped up today Yup, just insane how unaffordable havasu has gotten in last 2 years. It’s going to get interesting over the next year
 

THE WIDGE

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Nearly 160 houses listed in last 30 days and 80 in last 2 weeks. Definitely an uptick from what I’ve been watching last few months. But really, how many buyers are there out there to buy a house for 1.3 that exactly 2 years ago was 709k, that scenario popped up today Yup, just insane how unaffordable havasu has gotten in last 2 years. It’s going to get interesting over the next year
120 sold last 30 days, 50 last 15 days, we’ll see if the supply of buyers continue to purchase at these prices
 

satellitemike

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I just bought two Silverado 1500's @ $50k each. Crew cab, 6'6" bed & all the new electronics. Nice freaking trucks! I could never see paying $70 - 100k for a vehicle. They do nothin but depreciate but at least mine are making me money in the business. They won't be worth shit in 7 to 10 years. Be lucky to get $ 7500 for them at that point.
What trim level for 50K w all the new electronics?
 

LargeOrangeFont

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jet496

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What trim level for 50K w all the new electronics?

Probably all standard stuff now. I like it but I don't like having to figure it all out. I liked knowing where my knobs were. Anyway, it has "Auto Stop" when you stop at a light, it shuts down & starts up in a nano-second when letting off the brake. I wonder if this is hard on the engine & starter?

"Auto Brights" which go bright when nobody's around, constantly turnign brights on & off (you can switch it off but we found out we like it). "

Auto Brake" if you start rolling at a stop. "Lane Drift (I guess you call it that)" which grabs the wheel a bit to prevent you from drifting into a lane, which I switched off.

Wireless autoplay, all your phone data is on there for calling, big screen, other shit I could live with out & yet to discover, etc...
 

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HNL2LHC

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2FORCEFULL

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I need a patio slab and something for my swim spa to sit on. I think I’ll wait until it starts cooling down again.
just do pavers....??? also I put the spa 1/2 in the ground...

e2eba737dd93a2d711cdedc27236e144-uncropped_scaled_within_1344_1008.jpg
 
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2FORCEFULL

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I can smell the nicotine from here in Hawaii. I think that I just smoked a pack of cigarettes from looking at the photo so alone.
?????? I don't get it ?????

I see it's backed up to the power line main.... that would stop me from buying..
 

Gonefishin5555

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just do pavers....??? also I put the spa 1/2 in the ground...

e2eba737dd93a2d711cdedc27236e144-uncropped_scaled_within_1344_1008.jpg
It’s an option For now I have a temporary spot next to the house on pavers that I’m going to use until I finish the whole yard. It’s coming Monday. Do you like the pergola that lets sun shine through?
 

HNL2LHC

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?????? I don't get it ?????

I see it's backed up to the power line main.... that would stop me from buying..
While looking at the images the carpet and ceilings look to be rather dirty. King of like a home that was smoked in. It could be the lighting but that is what it reminded me of. 🤷‍♂️🤷‍♂️🤷‍♂️🤷‍♂️🤷‍♂️

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2Driver

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How about this one?


Probably would have been $75k in 2010

The only thing to even consider now would be something with unique long standing value like unprecedented views, waterfront exceptional layout and amenities. The regular stuff is going to take the biggest hit and slowest to return
 

2FORCEFULL

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It’s an option For now I have a temporary spot next to the house on pavers that I’m going to use until I finish the whole yard. It’s coming Monday. Do you like the pergola that lets sun shine through?
at night ....LOL
 

Orange Juice

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I wonder what kinds of problems $10 a gallon gasoline would bring?
In three years, electric vehicles will dominate new car sales.
Charging stations will cover areas, similar to cell phone coverage. (Infrastructure spending)

Gasoline pumps will be removed.
Mechanics no longer being trained on internal combustion engines.

By 2112, I’ll hop a turbine freight, to arrive at my uncles country farm. Things will be different. And if you think parts are hard to find today, give it another 20 years, and no one knows a red Barchetta, from a 1963 Split window Corvette. 😁
 
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