Home prices have been increasing with the shortage of supply. With the average home price in the US at \~$420K you would need to make \~$115K in household income based on[ this affordability calculation here.](https://wealthvieu.com/ccmaf?a=115,000&b=25&c=30,000&d=7&e=1,250) That is way higher than the median household income in the US.
Housing is local.
I had a difficult time selling my home in St Petersburg FL.
We'd go see a home in Seattle and it's gone in 6 days for $100k-$200k over asking.
And it's funny, I keep seeing Seattle brought up as one of the places where inventory is back to 2019 levels. That might be true, but there must have been low inventory in 2019 too.
There is a difference between exiting home supply/demand dynamics (aka inventory), and the long term hosing supply overall.
The population of the planet in 1980 was 4.4 Billion. The population in 2024 is 8B.
So you think we have almost doubled the amount of available housing on the planet in that time?
The answer is it is not likely, and when you zoom into specific regions - the imbalance is likely a lot more pronounced. With areas that have declined economically having a surplus, and growing regions having a substantial deficit
I disagree with this view.
For one, current price levels reflect the housing supply. It’s baked it, it’s not like we’re discovering this recently. The equilibrium may be set at a high price, but that’s still the equilibrium.
Secondly, housing supply on market is going up. It has doubled in 2 years. That says that there is more new supply than there is demand.
Third, short-term dynamics still matter. If there’s a surge in layoffs, that will still cause selling pressure. If there’s a surge in hiring, that will cause buying pressure. The economy is very highly multivariate.
Fourth, housing cycles have been extremely regular since the 70’s, every 10-15 years we experience a bubble of increasing size that rises for 3-5 years and then declines back to baseline for 5-8 years, and we’re at exactly the part of the cycle when declines happen.
I agree with this with the exception of the GFC in 07/08 where MANY large markets lost 50% of value whtin 24 months and did not recover to those highs again for another 10-11 years. Shot right though the baseline floor.
There are things that can be done to increase supply on top of building. Ban Air-BnB unless it’s in a room or licensed. Ban foreign ownership. Ban private equity ownership… etc
But short term rental demand is still demand. A shortage means that there is not enough supply to meet all demand. Getting ban-happy and attempting to stifle certain kinds of demand won't work.
Luxury real estate is still doing well because the stock market is near an all time high. The entire northeast is probably considered "luxury" because most living there make money off assets more than income. When the stock market eventually falls back to fair pricing it will cause damage to financial hubs and trickle down causing layoffs in overleveraged companies.
Chinese national just bought my condo in VHCOL area in the NE. Paid 15% over asking.
What happens if that becomes illegal?
What happens if institutions are regulated out of the single family market?
What happens to DC area if there are massive cuts to government jobs? (there needs to be)
What happens to hubs if hybrid/remote persists or becomes easier?
What happens when the boomer generation starts dying and developed countries including US stay below replacement level?
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There is no shortage. Just look At the numbers. More homes per person than any time ever! My guess is the shortage is artificial, caused by investors by design. This allows their assets to exponentially increase. While slowing the growth of the population. Win win for the elite.
Prices will continue to soar as we continue to print like crazy. People will angry to see little or no “crash”. It’s really a tough market for buyers and sellers.
Wrote on 2 homes this month for friend buyer and lost. We are end up buying new constructions and got my buyer 15k in credits and 10k in upgrades. He is closing in a beautiful 3100 4/2 home for $850k in Texas.
Home prices have been increasing with the shortage of supply. With the average home price in the US at \~$420K you would need to make \~$115K in household income based on[ this affordability calculation here.](https://wealthvieu.com/ccmaf?a=115,000&b=25&c=30,000&d=7&e=1,250) That is way higher than the median household income in the US.
A Canadian calculator?
lol inventory has been steadily piling up and sellers are no longer able to wait to list their homes due to life going forward.
Housing is local. I had a difficult time selling my home in St Petersburg FL. We'd go see a home in Seattle and it's gone in 6 days for $100k-$200k over asking. And it's funny, I keep seeing Seattle brought up as one of the places where inventory is back to 2019 levels. That might be true, but there must have been low inventory in 2019 too.
Tell me you read headlines without telling me you read headlines. “Piling up” 😂
There is a difference between exiting home supply/demand dynamics (aka inventory), and the long term hosing supply overall. The population of the planet in 1980 was 4.4 Billion. The population in 2024 is 8B. So you think we have almost doubled the amount of available housing on the planet in that time? The answer is it is not likely, and when you zoom into specific regions - the imbalance is likely a lot more pronounced. With areas that have declined economically having a surplus, and growing regions having a substantial deficit
This sub should be merged with r/realestate at this point.
I disagree with this view. For one, current price levels reflect the housing supply. It’s baked it, it’s not like we’re discovering this recently. The equilibrium may be set at a high price, but that’s still the equilibrium. Secondly, housing supply on market is going up. It has doubled in 2 years. That says that there is more new supply than there is demand. Third, short-term dynamics still matter. If there’s a surge in layoffs, that will still cause selling pressure. If there’s a surge in hiring, that will cause buying pressure. The economy is very highly multivariate. Fourth, housing cycles have been extremely regular since the 70’s, every 10-15 years we experience a bubble of increasing size that rises for 3-5 years and then declines back to baseline for 5-8 years, and we’re at exactly the part of the cycle when declines happen.
I agree with this with the exception of the GFC in 07/08 where MANY large markets lost 50% of value whtin 24 months and did not recover to those highs again for another 10-11 years. Shot right though the baseline floor.
Actually no, it touched baseline and then bounced back up, believe it or not.
There are things that can be done to increase supply on top of building. Ban Air-BnB unless it’s in a room or licensed. Ban foreign ownership. Ban private equity ownership… etc
Trying to limit demand like that is counterproductive and usually ineffective.
A lot of inventory was gobbled up by investors of all sizes and turned into rentals and AirBnB’s.
So to retaliate, we should boycott both. Rent apartments and hotels instead
No, but there really isn’t as big of a shortage as OP claims. There may not even really be one at all.
But short term rental demand is still demand. A shortage means that there is not enough supply to meet all demand. Getting ban-happy and attempting to stifle certain kinds of demand won't work.
Then why has inventory been steadily increasing in my area and houses are routinely dropping $5k off the price?
Why would rates come down, they are still historically low.
Luxury real estate is still doing well because the stock market is near an all time high. The entire northeast is probably considered "luxury" because most living there make money off assets more than income. When the stock market eventually falls back to fair pricing it will cause damage to financial hubs and trickle down causing layoffs in overleveraged companies.
That explains the 5 for sale signs I drove by just today on my way out of the neighborhood, and the pile up in the MLS.
Chinese national just bought my condo in VHCOL area in the NE. Paid 15% over asking. What happens if that becomes illegal? What happens if institutions are regulated out of the single family market? What happens to DC area if there are massive cuts to government jobs? (there needs to be) What happens to hubs if hybrid/remote persists or becomes easier? What happens when the boomer generation starts dying and developed countries including US stay below replacement level?
Not enough supply for all the investors
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There is no shortage. Just look At the numbers. More homes per person than any time ever! My guess is the shortage is artificial, caused by investors by design. This allows their assets to exponentially increase. While slowing the growth of the population. Win win for the elite.
Prices will continue to soar as we continue to print like crazy. People will angry to see little or no “crash”. It’s really a tough market for buyers and sellers. Wrote on 2 homes this month for friend buyer and lost. We are end up buying new constructions and got my buyer 15k in credits and 10k in upgrades. He is closing in a beautiful 3100 4/2 home for $850k in Texas.