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The Prices We Saw In 2018 Are No Longer Relevant

A report from 5280 in Colorado. “Well, Denver: It’s been quite a journey. Over the past decade, we’ve experienced what just might be the metro area’s most volatile period of growth ever and a record-setting real estate market. The ride hasn’t been smooth, but this past winter it felt like we were due to catch our breath and figure out what the heck just happened. ‘We’ve never experienced a run-up like that,’ says Kerron Stokes with Re/Max Leaders. ‘We’ve had a decade with no punctuation.'”

“But then March came—and it brought with it so many question marks. Buyers are tired of Denver’s boom, and they’re taking their frustrations out by being a lot pickier about putting in offers. Appraisers gather prices from nearby sales (“comps,” in real estate parlance) to estimate a house’s value. But they typically use data less than six months old, which means the maximum sale prices we saw in 2018 are no longer relevant.”

“‘There are a lot of people who didn’t catch up to the fact that the market was different last year, and they were pricing incorrectly,’ says Jill Schafer, chair of the Denver Metro Association of Realtors’ market trends committee. ‘They were trying to top the last sale when you needed to be slightly under it.'”

“I love, love, love this house. Should I write a letter to the sellers about why? The short answer is no. We know it was all the rage for a while, so let us explain: Would you ever write a note to a used car salesman explaining why he must, must, must sell you that 2017 Subaru because you dream of summiting all the state’s fourteeners (with attached photos of your yellow Lab to win him over)? Of course not; it’s a business transaction.”

The Spectrum in Utah. “Businesses are closed and unemployment is skyrocketing due to the coronavirus pandemic. Southern Utah’s economic future is uncertain. Houses in the $350,000 range are still in high demand, according to Washington County Board of Realtors president Chantel Markel. Demand for higher-end housing in St. George is declining though, Markel said. Markel said these buyers are being more ‘cautious.’ Overall, Markel said she isn’t seeing many people trying to get rid of their homes by dropping the prices drastically. Her advice to those that are trying to sell at this time? Wait it out.”

“‘Those that are getting nervous because they don’t know what will happen are tending to drop their prices. Where there are still some who will want to just ride this out and it will be fine,’ Markel said. ‘The people aren’t dropping them as much as you would think.'”

From The Oklahoman. “By all accounts, sales were strong and on the increase right up untll the coronavirus hit Oklahoma City in mid-March. ‘The third week we saw a slight downward motion, but by fourth week of March and especially the first week of April, we saw a 23% spiral downward. The most significant decrease is $150,000 and under. These are most likely the investors and the service individuals who have lost their jobs,’ said Linda Tracy, a real estate agent.”

“‘I expect as I pull the numbers for the second and third week in April that $150,000-$300,000 will have a sharper decline. The problem is if this continues on for another month or two and people in that under-$150,000 group cannot make their mortgage payments, investors will quit buying those government-backed loans, and Federal Housing Administration and U.S. Department of Agriculture (backed loans) will shut down,’ said Tracy. ‘Then we are going to be in a world of hurt because that will affect the investments the higher-price customer has that they depend on.'”

The Press Democrat in California. “Ten years ago, Michael Wolff started his Santa Rosa homebuilding firm during the throes of the Great Recession, which sent the construction sector into a spiral, wiping out half of the jobs in the industry statewide over two years.But the economic shock caused by the novel coronavirus has taken the struggle to survive to another level for contractors. ‘It’s damn near strangling the life out of me right now,’said Wolf.”

“He laid off some employees and forced two framing crews to burn vacation time because of the diminishing work. One saving grace has been home rebuilding from the 2017 fires is permitted and lenders have largely financed those projects. That stable work, however, is no longer a sure thing. A house rebuild job Wolf was supposed to do soon for Christopherson Builders — whose homes typically sell for more than $1 million — has been put on hold by a skittish couple. ‘It was a sure thing … that will hopefully still be a sure thing, but we are waiting,’ Wolff said.”

“John Farrow is a developer and partner in a planned 153-room Reverb Hotel project in Cotati. But Poppy Bank recently pulled the financing and no local bank has filled the void. An apartment complex in Petaluma and a plan for single-family homes in the posh Fountaingrove area of Santa Rosa he wanted to develop also have been placed on hold. ‘When I put my developer hat on, this is a problem,’ Farrow said of construction investors and lenders in retreat.”

“Another big concern that could put contractors in further jeopardy is the potential for more homeowners to start defaulting on their mortgages like they did 10 years ago. That would force lenders to repossess houses and trigger a retraction in the homebuilding market, Farrow said.”

The Real Deal on California. “Maximus Real Estate Partners has requested debt forbearance on a $955 million loan for its massive Parkmerced residential development in San Francisco, the latest casualty of the coronavirus crisis. KeyBank is the master servicer of the loan, and Maximus is making the request because of hardships related to the pandemic, according to Kroll.”

“The complex is the largest multifamily property in San Francisco and the second largest multifamily property west of the Mississippi River, according to Kroll. San Francisco has issued a moratorium on evictions for any reasons except violence, health and safety issues until June 21. Maximus expects that will impact its rent collection, according to Kroll. It has assigned the Parkmerced loan an outlook of ‘underperform.'”

“Maximus paid its debt service in full for April and has no immediate plans to seek forbearance, according to Parkmerced spokesman PJ Johnston. ‘Like virtually every other capitalized business in the United States, we have been forced to discuss a wide array of pending issues with our lenders, given the coronavirus pandemic and its impacts on our business,’ he said in a statement. The San Francisco Bay Area has an extremely tight housing market, but the pandemic has put a dent in it, with sales dropping by 35 percent year over year.”

From Tap Into Clark on New Jersey. “It’s looking like we will look back on 2020 as the year that things got very weird. The luxury market (homes priced at more than $2,000,000) will continue to be in a strong buyer’s market. In some high-end markets if no new homes came on the market it would take more than 2 years to sell off the current inventory.”

“For the short term, if you don’t NEED to sell, you should stay where you are. You’ll likely make more selling a year or two down the road. If you sell your home between now and the end of the year, you will be selling it anywhere between 3% and 12% less than what you could get by waiting. If you need to make a move, be prepared to discount your price. You will likely find that it will take longer than what we’ve been experiencing the last couple of years and you may only get offers significantly lower than you would have gotten three months ago. Even if prices fall 5%, buyer’s offers will likely be 1.5 times the drop in price. So if your home was worth $500,000, it’s now worth $475,000 and buyers will be offering about 7.5% less around $462,500.”

“If your home is currently on the market, you’ll most likely need to drop your price. Overpriced homes take a long time to sell and when they do they will sell for less than what they would have if the home was priced right when it first went on the market. We promote a strategy to price your home 3-5% less than current market value.”

From Queens News in New York. “Before the pandemic went into full force, real estate prices in New York City began to fall while rental prices continued to soar. However, in the last two weeks of the quarter, the impact of coronavirus on the New York City market was greater than anyone expected. ‘Economic uncertainty is causing understandable hesitation from buyers, sellers, and renters,’ says StreetEasy Economist Nancy Wu. ‘If coronavirus does in fact trigger a global recession, we could see prices and buyer activity levels mimic what happened during the 2008 financial crisis.'”

“According to the report, during the first quarter of 2020 Manhattan saw its price index drop 3.2% to $1,073,104, a six-year low for the borough.”

From Curbed New York. “Leading up to the pandemic’s rapid spread throughout the city, New York sales prices entered their third year of slowdown. The median recorded sales price in many neighborhoods across the city fluctuated wildly between the first quarters of 2019 and 2020. The steepest drop in year-over-year median recorded sales price occurred in Midtown South, where prices dropped 62.8 percent to $795,000. Central Park South trailed with a 50.2 percent decrease in median recorded sales price to $1.23 million. Carroll Gardens saw a 38.7 percent decrease to $1.475 million.”

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This Post Has 120 Comments

  1. ‘The complex is the largest multifamily property in San Francisco and the second largest multifamily property west of the Mississippi River’

    It’ probably been two years since the Chronicle quoted a Related guy saying every single downtown San Francisco housing project was up for sale. This bubble popped long ago.

    1. ‘the first quarter of 2020 Manhattan saw its price index drop 3.2% to $1,073,104, a six-year low for the borough’

  2. ‘Appraisers gather prices from nearby sales (“comps,” in real estate parlance) to estimate a house’s value. But they typically use data less than six months old, which means the maximum sale prices we saw in 2018 are no longer relevant’

    ‘There are a lot of people who didn’t catch up to the fact that the market was different last year, and they were pricing incorrectly,’ says Jill Schafer, chair of the Denver Metro Association of Realtors’ market trends committee. ‘They were trying to top the last sale when you needed to be slightly under it’

    What Jill is admitting is that prices have been falling in Denver for years. Readers here have known that. It was the familiar ebola that spread from San Jose, to Seattle to Las Vegas to Boston to Tampa. It had been crater in NYC and Miami for longer than that.

    1. The thing is that a few upper middle class areas – Lowry, Cherry Creek etc were continuing to be hot. That confused folks in all the rest of the Denver area – and they were not pricing correctly

      1. What do you meant? My shack in Federal Way has appreciated just as much at that house in Medina!!

        1. ha ha MGS

          I heard that Medina with all the billionaires is not getting sufficient property tax. They are literality begging Gates, Andy Jassey (AWS chief), Balmer and others to voluntarily pay more.

          I suspect that Federal Way will be way more stable going forward – congrats and celebrate with some hot wings

          1. Not 100% sure — except for the fact that every, EVERY city & municipal government is begging and/or scheming for more money.

            I’ve got a former classmate living in Federal Way and visit down that way occasionally – The homeless and drug problem is really getting visible there. I keep wondering ‘When will people hit their breaking point for putting up with it (the current coddle the addicts and punish the law abiding)?”

          2. When will people hit their breaking point for putting up with it (the current coddle the addicts and punish the law abiding)?”

            I recall the scene in “Seattle is Dying” where some Seattle politico laughs at angry citizens at a town hall meeting.

  3. Median household incomes do not support Denver asking prices.

    I’ll be renewing my lease for another year.

    1. ‘A two-time Olympic freestyle skier is looking for a buyer for her two-story triangle-shaped building in downtown Denver. Michelle Roark listed the 6,231-square-foot structure at 2150 Curtis St. on March 17 for $5 million. The price has since been reduced to $4.85 million.’

      ‘Roark purchased the building for $1 million when it was in foreclosure in 2008, she said.’

      https://businessden.com/2020/04/24/former-olympic-skier-lists-triangle-shaped-downtown-building-for-5m/

      1. How ironic would it be if it goes into foreclosure again in 2020, and is again purchased for $1 million?

    2. Median household incomes certainly do not support NYC’s housing prices.

      “For the short term, if you don’t NEED to sell, you should stay where you are. You’ll likely make more selling a year or two down the road. If you sell your home between now and the end of the year, you will be selling it anywhere between 3% and 12% less than what you could get by waiting. ”

      Right now you might be able to put out a big price cut, and get someone who thought the prior price was real to bite. After that, forget it.

      1. 2-3 years to become a competent apprentice, depending on type of experience. I have both big construction (i.e. multi-family 200+ units) experience and service experience. Some people get stuck in a rut and never fully develop their skill set.

        5-10 years (and licensure) to be able to run your own service calls out of a van and write bids accurately. Troubleshooting and problem solving is key.

        I’m the youngest in a family of electricians to follow into the trade after working unfulfilling jobs in banking, accounting, government contracting. Had I known I would have started in the trade when I was 18.

        1. Thanks. That’s an enormous amount of time to present to an 18-21 year old as the path to becoming a full-fledged licensed tradesman.

          2. That’s your answer regarding becoming competent.

            Regarding licensure, it varies by state. Here it requires 2 years of apprentice school, which I did one night a week, 36 classes a year. Also 8,000 hours in the field, 4,000 of which must be commercial hours. Colorado will only accept 2,000 hours a year so there are no shortcuts i.e. working alot of overtime and getting your license in 3 years. Young people could start their apprenticeship at 18 and get a journeyman’s license at age 22. A master’s license (required to pull permits for running your own jobs) requires an additional 2,000 hours which must be categorized as planning, layout, and supervision.

          3. That’s an enormous amount of time to present to an 18-21 year old as the path to becoming a full-fledged licensed tradesman.

            Are the 18-21 year olds these days expecting to not have to put in a few years to establish themselves in a dedicated career?

          4. Regarding licensure …

            Sounds like it’s easier to become a brogrammer, especially if you attend a boot camp program vs. getting a CS degree.

  4. ‘I expect as I pull the numbers for the second and third week in April that $150,000-$300,000 will have a sharper decline. The problem is if this continues on for another month or two and people in that under-$150,000 group cannot make their mortgage payments, investors will quit buying those government-backed loans, and Federal Housing Administration and U.S. Department of Agriculture (backed loans) will shut down…Then we are going to be in a world of hurt because that will affect the investments the higher-price customer has that they depend on’

    You can see how lending falls in on itself. These USDA loans are reserved for low income, subprime borrowers only. You think they might stop paying when the guberment is telling them to? BTW, what is rural was expanded into places that had no business being called rural. Why would the REIC do that?

  5. ‘Houses in the $350,000 range are still in high demand, according to Washington County Board of Realtors president Chantel Markel. Demand for higher-end housing in St. George is declining though’

    Again, how many people there could afford 350k in good times? The REIC let prices get out of control in every nook and cranny of the US.

    1. Have a buddy in the DFW (near SMU). He was going to start working remotely and buy a splendid place in St. George

      Good lucking getting a great selling price in downtown Dallas – but maybe his acquisition price in St. George will be the same % down.

      So in the next 2-3 years – lots of arbitrage required by the consumers

    2. “Again, how many people there could afford 350k in good times” (SoUtah)?

      Primarily retirees coming from Cali, Arizona and Nevada after cashing in their home “equity” and buying new homes here for $700,000.00 plus. The other group is composed mostly of public pensioners from east of the Rockies or individuals from Salt Lake who wanted second homes.

      Almost ALL of the other house buyers around here are locals involved in house building, house selling & house related businesses. Construction, title companies, carpet sales, tile installation, home improvement and selling home furnishings mostly.

      Last bust almost all of those second homes went on the market (at the same time) and the construction “guys” left town or lost their homes to foreclosure while the unemployment rate went to over 15%. which was the highest in the history of Washington County.

    1. Nice estate, but more likely a speculative land buy. In the Maryland sticks, the countryside is dotted with sudden developments of townhomes or McMansions. This is a 40-minute drive from either the MD burbs or Baltimore. Clearly there is demand for outer-flung burbs, especially now that working at home is catching on (thanks, COVID).

      Northern Virginia is no different. That Hume farm is only 40 minutes to Fair Oaks, which is where you start seeing real office buildings and jobs. And VA is much for forgiving in its zoning laws than MD. Virginians loves them some tax dollahs, fo sho. It wouldn’t take much to convert the historic farmhouse into a clubhouse/pool, and concvert those 291 agricultural acres into 150+ McMansions from the low $700s.

  7. ‘The Richmond City Council considered this week whether to suspend both rent and mortgage payments in what would have been the most provocative housing protection measure taken by any Bay Area city in response to the COVID-19 outbreak.’

    ‘However, when it came time to vote, only the measure’s original sponsors backed it, with other Richmond legislators suggesting that the city lacks the authority to take such a step. Lawmakers in other Bay Area cities, including San Francisco, have floated similar ideas, but most city bodies feel that local governments don’t have authority over such things. State law oversees rental rules, and a mortgage pause would likely require federal intervention.’

    “I agree with the intent of this,” said Councilmember Jael Myrick before the vote, “but it’s hard for me to believe we have the authority.” Myrick predicted that such a move would only bring legal disaster down upon the city.’

    ‘Councilmember Nat Bates, openly annoyed that the debate was even happening, said, “We are not a regional government, we are not a state, we are not federal,” He added, “We are the small fish in the fry, and […] why I’m not hearing that is beyond me.”

    https://sf.curbed.com/2020/4/24/21234328/rent-freeze-richmond-city-council-coronavirus-covid-19

    1. Lawsuits Pile Up Against Coronavirus Lockdown Measures

      From bridal shops to conservation groups, plaintiffs are challenging state-imposed restrictions on travel and business as unconstitutional

      ‘In Michigan, a conservation group challenged a ban on motorboat use. In Ohio, a bridal shop is suing over its designation as a nonessential business that must close. And in Virginia, the owner of a fitness chain claims that Democratic Gov. Ralph Northam overstepped his authority by shutting private health clubs last month.’

      ‘The lawsuits have targeted specific provisions that plaintiffs claim are vaguely drafted, unreasonable and unfair, going beyond an initial round of shutdown-related litigation that focused on religious and abortion rights. The latest suits allege violations of the right to due process and equal protection of the law under the 14th Amendment and other constitutional safeguards.’

      ‘State constitutions and laws give governors broad but not unlimited authority to restrict personal freedoms for the greater safety of their residents during an urgent health crisis. Almost every state has issued lockdown orders limiting travel, social interaction and commercial activity.’

      ‘Some governors have eased restrictions on their own in recent days, and judges have been reluctant to second-guess emergency measures intended to protect human life. But as some governors extend restrictions deeper into the spring, states aren’t guaranteed unlimited leeway.’

      ‘Echoing many voices on the political right, Attorney General William Barr has signaled support for legal challenges, saying the Justice Department would consider filing statements of interest for some plaintiffs. The statements carry no force of law but are a powerful show of Trump administration backing.’

      “These are very, very burdensome impingements on liberty,” Mr. Barr told conservative radio host Hugh Hewitt on Tuesday. “We’re looking carefully at a number of these rules that are being put into place. And if we think one goes too far, we initially try to jawbone the governors into rolling them back or adjusting them. And if they’re not and people bring lawsuits, we file a statement of interest and side with the plaintiffs.”

      ‘About a month ago, Virginia’s Mr. Northam ordered that fitness centers were among nonessential businesses that had to close, among the measures he has imposed to slow the outbreak’s spread.’

      ‘Merrill C. “Sandy” Hall, a co-owner of nine Gold’s Gym locations in Virginia, said in a lawsuit that Mr. Northam didn’t have the constitutional authority to determine essential businesses. Mr. Hall said his businesses are on the brink of financial ruin and that litigation was a last resort.’

      “I don’t think our governor is a king,” said Virginia Republican state Sen. Bill Stanley, a lawyer representing Mr. Hall in the case filed last Tuesday in Culpeper County Circuit Court. A judge hasn’t ruled in the case.’

      https://www.wsj.com/articles/lawsuits-pile-up-against-coronavirus-lockdown-measures-11587807000

      1. Despite City Council Vote, Denver Residents Sill Have to Pay Rent

        ‘The vote is mostly symbolic, Gov. Polis making it clear he doesn’t have the power to do that. “No governor, no president, has the legal ability to suspend the sanctity of contact law. It’s common law. No state has done that. What we want to do in Colorado, and I have done that, is make sure that we take the strongest steps of any governor to help protect renters. That means using our legal authority, the full weight of it,” said Polis.’

        https://denver.cbslocal.com/2020/04/13/despite-city-council-vote-denver-residents-pay-rent/

        1. There are rent strike posters all over East Colfax.

          If you moved here from out of state to get a job as a budtender making $15/hour, maybe Denver isn’t for you. Move back in with your parents and develop a skill set to get a real job.

          1. Oh look, “Bernie’s gonna win” is getting all bootstrappy now.

            You’re just as vulnerable to joining the ranks of the unemployed as anyone else is, Mr. Knowitall.

          2. Bernie was gonna win, until he didn’t.

            I’ll be strapping my boots if I do a through hike (350 miles) of the Colorado Trail this summer. You don’t do that when you’re retired, you do it when your body is still young enough.

            And yes, I’m happy you can now buy seeds.

          3. ‘The New York Daily News used its Thursday front page to mock billionaire media mogul Michael Bloomberg over the amount of money he spent on his failed presidential campaign.’

            ‘The tabloid newspaper depicted the former New York mayor as wearing a holiday destination-style souvenir top emblazoned with the words: “I spent $500M & all I got was this lousy T-Shirt.”

            https://www.huffpost.com/entry/new-york-daily-news-michael-bloomberg-out_n_5e60b337c5b69d641c0aec80

        3. A state can’t suspend contract law but it can greatly limit the ability of parties to enforce contracts. Pretty much the same result.

          1. I took courses in business law and real estate law. The first thing they make clear about common law is what it’s grounded in. Hundreds of years of precedent. It isn’t US based or UK based. And in that time pretty much any and every situation has been examined and ruled on three ways from Sunday. It’ll get set right, the lawsuits are already “piling up” as the WSJ report says.

            And for those financially harmed by intrusion in the rightful process, there are remedies!

            BTW, this is why you are crazy to buy real estate in places not under common law.

          2. When you say “it’ll get set right,” what do you think the right outcome will be? I sincerely don’t know the answer.

            Suspending rent and mortgages is nice and all, but how about a reward for those who were responsible and prepared for adverse circumstances? I’m tired of being told that I have to foot the bill for 30% of the population because I’m “fortunate.”

          3. ‘what do you think the right outcome will be?’

            If one needs their day in court they’ll get it. Almost everything has precedent, so that is presented and the judge upholds the law. The strength of common law is it is voluminous, widely known, and designed to deliver relatively quick, absolute outcomes.

      2. The best tool people have against power-drunk slime-mold governors is the recall. California booted Davis out for less…

        1. A lot of people don’t understand that various governments/bureaucracies do illegal or unauthorized stuff all the time. They are constantly sued over it.

      3. “If the natural tendencies of mankind are so bad that it is not safe to permit people to be free, how is it that the tendencies of these organizers are always good? Do not the legislators and their appointed agents also belong to the human race? Or do they believe that they themselves are made of a finer clay than the rest of mankind?”
        ― Frederic Bastiat, The Law

  8. ‘New inventory is still coming to market, but since the first month of spring traditionally serves as a kickoff for the busiest few months of the year in home sales, 2020’s selling season so far looks bleak. That’s true across the board, but the slump is particularly pronounced in the ultra-luxury market. Of the nearly 120 homes currently offered in San Diego County for more than $5 million, just a dozen were listed in the last month.’

    ‘While the Cornish Drive estate’s listing may be new, it’s not the first time the property has been offered for sale. Originally purchased as vacant land for $1.2 million in 2015, marketing efforts for the new home began in 2017 before ground was even broken. After attracting no buyers with a $5.2 million price tag, construction was completed in 2019 and the home was re-listed, first at $7,350,000 and again at $5,850,000 — again, without attracting a buyer.’

    ‘After being pulled from the market in late November, the home was re-listed in mid-April with its asking price reduced to $5,395,000, which remains unchanged to date.’

    https://www.sandiegoreader.com/news/2020/apr/23/unreal-estate-avant-garde-architecture-cardiff/

    1. “But they typically use data less than six months old, which means the maximum sale prices we saw in 2018 are no longer relevant.”

      Some of you may have seen my posts over the past few days about the oceanview home the Gates’s recently bought in Del Mar (North County San Diego) for less than it sold for in 2007, especially after adjusting for 13 years of inflation since then.

    2. Nearby 1160 Arden Drive was taken off the market 4/23/2020. Even though it was listed for sale on 3/2/2020, it had a coming soon sign dating back to early 12/2019. This marks its second failed attempt to sell. Major takeaway with this one and 1329 Cornish Drive: don’t overbuild.

  9. How does the covid-19 immunity passport work? Do I have to get one for each strain of covid-19? What if there are 10 or 20 strains? 20 passports? Do I have to renew each year?

    1. It will be administered with the same level of bureaucratic inefficiency it takes to get a permit to build a new house in California. Or to get a business license to braid hair or groom dogs.

      The Democrat Party doesn’t want anybody going back to work.

      Newt Gingrich was right when he called Obama the “food stamp president.”

      1. “Newt Gingrich was right when he called Obama the “food stamp president.”

        And I call every president since Reagan the “president for wallstreet”

          2. It’s pretty much the same with a Democrat or Republican in the WH, except their FSA members are found at opposite ends of the wealth distribution.

          1. Funny how most of the cars parked at food banks seem to be late model luxury brands, mostly leased or financed out to 84 months, I’m guessing.

    2. The Financial Times
      World Health Organisation
      WHO warns against coronavirus ‘immunity passports’
      Health agency says there is no evidence recovered patients are shielded from reinfection
      4 hours ago
      …

      1. Yeah, like I’m gonna believe the WHO, the geniuses who saw “no evidence” of asymptomatic transmission or p2p transmission.

        My understanding is that the poorest immunity we develop is 3 months of immunity to the common cold. The problem is that the common cold is actually 200 different viruses, so all that means is that we don’t catch the exact same cold twice a year. Anyway, I think there is such a thing as immunity.

        A more plausible explanation is that the WHO anticipates massive fraud. At best, people will fake the paperwork. At worst, people at higher risk, but in need of a job, will deliberately catch COVID to build immunity. They are the ones most likely to have a bad outcome.

  10. Is inventory growing in your hood?
    Do you know of any STAGflation funds?
    A complicated portfolio to manage.

  11. i was just thinking … in the last 20 years how many years did we have what would be considered reasonable home prices? 2000-2001, 2009-2014?

      1. 2001 were the least costly but still elevated roughly 2x / long-term trend.

        1994 was about when we really started to stick it buyers of construction services.

      2. We bought a house in 2013 for $86000 in a short sale. Has it as a rental for a few years and sold it for over $300,000 last year. So all the shirt sales and foreclosure prices back then were pretty reasonable to me. Though I get it … there were areas lose by with highly sought after school districts that so a much smaller drop. So long as inflation keeps cheffing along, housing is going to keep bubbling and popping hard.

        I’ve always figured that at some point, like post Great Depression, housing as a growing investment will reverse. When I heard that hedge funds got into the rental business after the housing bust and started driving up rents all around, I wondered what would happen if things collapsed to the point where hedge funds started to sell.

          2. “Not so skilled with thumb typing on my phone.”

            Create a note using the dictation module (mic icon), spell check and then paste it as your blog comment.

          4. a 5 to 10 minute window

            You already have that. The window closes when you hit the “post” button.

          5. You already have that. The window closes when you hit the “post” button.

            Hahah…ouch. I laugh as someone whose proofreading skills go from a “3” to a “10” within 1 second *after* hitting the post button.

    2. Not 2013 or 2014. By then the bubble was reinflating. 2009-2012 was when house prices were in line with the 50-year historic inflation curve. Outside of that prices were bubble.

      1. There were some lesser/smaller town markets that stayed reasonable until 2014 or so. Others, mostly more urban touched reasonable around 2010-11, but were on their way back up and out by 2012.

      2. Incorrect.

        The median sale price those years to were still multiples over long term trend.

        2009-2012 was just a minor correction.

  12. “But they typically use data less than six months old, which means the maximum sale prices we saw in 2018 are no longer relevant.”

    Now he tells us!

    The truth only comes out when you’re a little bit hungrier LOL

    “According to the report, during the first quarter of 2020 Manhattan saw its price index drop 3.2% to $1,073,104, a six-year low for the borough.”

    6 years of bubble gains wipe out. Btw this means the peak for NYC was in 2014. Before the Pandemic!!!!!!

  13. ‘Defenders of coronavirus lockdown mandates keep talking about science. But scientists are almost never unanimous, and many appeals to “science” are transparently political or ideological. Consider the story of John Ioannidis, a professor at Stanford’s School of Medicine. His expertise is wide-ranging.’

    ‘In a March article for Stat News, Dr. Ioannidis argued that Covid-19 is far less deadly than modelers were assuming. He considered the experience of the Diamond Princess cruise ship, which was quarantined Feb. 4 in Japan. Nine of 700 infected passengers and crew died. Based on the demographics of the ship’s population, Dr. Ioannidis estimated that the U.S. fatality rate could be as low as 0.025% to 0.625% and put the upper bound at 0.05% to 1%—comparable to that of seasonal flu.’

    “If that is the true rate,” he wrote, “locking down the world with potentially tremendous social and financial consequences may be totally irrational.”

    ‘Yet most criticism of the Stanford study has been aimed at defending the lockdown mandates against the implication that they’re an overreaction. “There’s some sort of mob mentality here operating that they just insist that this has to be the end of the world, and it has to be that the sky is falling. It’s attacking studies with data based on speculation and science fiction,” he says. “But dismissing real data in favor of mathematical speculation is mind-boggling.”

    “Compared to almost any other cause of disease that I can think of, it’s really sparing young people. I’m not saying that the lives of 80-year-olds do not have value—they do,” he says. “But there’s far, far, far more . . . young people who commit suicide.” If the panic and attendant disruption continue, he says, “we will see many young people committing suicide . . . just because we are spreading horror stories with Covid-19. There’s far, far more young people who get cancer and will not be treated, because again, they will not go to the hospital to get treated because of Covid-19. There’s far, far more people whose mental health will collapse.”

    https://www.wsj.com/articles/the-bearer-of-good-coronavirus-news-11587746176

    1. “If that is the true rate,” he wrote, “locking down the world with potentially tremendous social and financial consequences may be totally irrational.”

      Shut up and Obey!

      1. C’mon….you don’t like all the sanctimonious propaganda parades?

        How about dozens of cops arranging their cruisers in the shape of a heart?

        1. Onions are back in stock! TP, not so much. But there are noises of widespread food shortages on the way. I guess we’re shopping off of existing inventory.

          1. noises of widespread food shortages

            There is an abundance. The only shortages are those caused by hysterical hoarders hearing “noises”.

          2. Just got back from Safeway. King Soopers had a stupid line outside the door. Forget that! Safeway was fully stocked, they even had TP.

        2. Mania #2 (xaoh.deeth.👾.hy$teria)

          I$ feeding & devouring$

          Mania #1 (Bubble$.Ever.Thang$)

          Thi$ i$n’t over yet$!

          1. “C as in”

            The three famed Coronavirus HBB cheerleaders that brought the daily barrage of Have you seen the latest 100,000 Coronavirus deaths in Ohio 2 million deaths in U.S could’t have been more wrong Headless Headlines right here for all to see.

    2. 50,000+ deeth👾.knob&handle.killa.germ$ … in le$$ < 40 day$

      (Go.aheads stick yer fingers in a bowling ball & hold a hotdog in yer other, matter$.knot to me.)
      🐝Free!

      Eye'll bee a.gone fishin' & don't mind drinkin' alone one bit$. 🥨🍺

        1. C as in Carry.on!
          C as in Continue$
          C as in Carele$$!

          Bugs: “maybee doc, how many knobs & handles do you touch?”

          👾 munch, munch, munch

          Bugs: “eh good thing carrots grows underground!” 🥕munch, munch

          2020 Corporate$ & Con$umer debt$ load$ + invi$ible deeth👾killa.germ$ =

          🏘 & 📉

          A. Carnage$
          B. Collap$e$
          C. Calamitie$
          D. Catastrophe$
          E. ALL OF THEE ABOVE ☝️

          1. Heal.thyself!:
            x1 lime lysol 🍬 + x1 2oz bleach Bombay gimlet🍸 x1 Marlboro 🚬, ummmmmm. Enjoy!

            (Aka: thee🍊.jesus “$uicide” concoction!)

            Don’t forgets to brush yer teeth afterwards with Dr. A. Jone$ “Miracle$” brite.white toothpa$te!

    3. “are almost never unanimous”

      Does this apply to how climate change is real, but that there are an infinite number of genders, as our betters tell us?

      1. climate change is real

        It’s climate Crisis now. Try to keep up.

        One thing this Panicpandemic has shown is that despite having some of the most educated people on the planet study disease for their whole lives over centuries, they don’t seem to know much, and what they do know changes from day to day.

        1. Reckon it’s tough to understand: “rates” even tougher to comprehend: “distribution”

          Think they can count & compare:

          50,000+ deeth👾.knob&handle.killa.germ$ … in le$$ < 40 day$

          2. “we were afraid of million$.”

            Thankfully, “cold.$eason” is over, as of today, 4/25/2020

            (That was one seriou$ Global $notty.no$e “common.cold$!” epi$ode!)

            $hame the xaoh.deeth.👾.knobs & handles.killa.germ$ had $uch negative effect$ on thee.$helter.$hack.cult.member$, & Czar.Putain$ Ru$$isa & $weet.mB$ $audi de$ert $oiree.

            $ad. Eye’m just $o $ad.

    4. Liberals lost their right to virtue signal when they ignored science and latched onto those faked hydroxychloroquine ‘studies” solely to thumb their noses at Trump. Science also says — quite loudly — that HCQ is effective when given early and combined with zinc. Other science suggests that you don’t even specifically need HCQ; all you need is a drug that helps the zinc cross from the bloodstream into the cell. There are several of these drugs which don’t have the side effects of HCQ, including at least one that’s OTC.

      I’m hoping and praying that the doctors thumb their noses at big pharma and do more research those zinc treatments, fast. It’s nice and all to give HCQ to critical patients at the hospitals. But what we really need is a very cheap mild treatment that we can hand out to people with milder cases so to reduce their misery from, say, 4 weeks to 1 week. With that and testing, I think the young and healthy could go back to work and just ride it out to partial herd immunity.

      I for one don’t mind wearing a mask. But I DON’T like the idea of being tracked through my cell phone. Today I went for a little drive and then went food shopping, in a mask. I left my phone at home. (But Toyota probably knows what I did.)

      1. just ride it out

        Lots of people out today. A relatively young unmasked runner in Poway picked up a stick to press a metal crosswalk button; it was 86 degrees out. A lone bike rider through Rancho Santa Fe was wearing a mask. Why?! Facial coverings for bike riders and pedestrians along Pacific Coast Highway varied. We definitely got the sense that people are fed up with the stay-at-home order.

  14. “We promote a strategy to price your home 3-5% less than current market value.”

    Yes, the trick the “knife catcher” buyers strategy. You do know that this means the new price become the new market value. This seems like the first one out gets less of a beatings. As they said, he who panic first, panic best. But I’m sure many will chase the market to the bottom in the next 3 to 5 years. Here we call those morons the bagholders or just FB.

  16. Her advice to those that are trying to sell at this time? Wait it out.”

    By the time the carnage plays out, millions of former sheeple will be permanently inoculated against ever trusting the REIC or its MSM shills.

  17. “By all accounts, sales were strong and on the increase right up untll the coronavirus hit Oklahoma City in mid-March.

    Yeah, and my lifeguard gig was my best summer job ever, until that blue kid turned up.

    1. Thee.🍊.jesus would remind you that YOU failed, $ad.

      “Real American War Hero’s don’t get captured!!!”

      “Stupid McCain!” Cpl bone.$pur$

  18. The problem is if this continues on for another month or two and people in that under-$150,000 group cannot make their mortgage payments, investors will quit buying those government-backed loans, and Federal Housing Administration and U.S. Department of Agriculture (backed loans) will shut down,’ said Tracy.

    I fail to see the problem.

  19. “Maximus paid its debt service in full for April and has no immediate plans to seek forbearance, according to Parkmerced spokesman PJ Johnston.

    We’ll pretend you’re still solvent, PJ, if that helps.

  20. “It’s looking like we will look back on 2020 as the year that things got very weird.

    No, we’ll look at it as the year true price discovery could no longer be deferred by the Fed’s deranged money-printing.

  21. However, in the last two weeks of the quarter, the impact of coronavirus on the New York City market was greater than anyone expected.

    Show of hands: who on the HBB wasn’t expecting this?

  22. “For the short term, if you don’t NEED to sell, you should stay where you are. You’ll likely make more selling a year or two down the road.

    Worse.advice.ever.

  23. The steepest drop in year-over-year median recorded sales price occurred in Midtown South, where prices dropped 62.8 percent to $795,000. Central Park South trailed with a 50.2 percent decrease in median recorded sales price to $1.23 million. Carroll Gardens saw a 38.7 percent decrease to $1.475 million.”

    Is that a lot?

    1. “…is $till $linging the bull$hit”

      Just like the “acting”.$ocialist.Trea$ury.$ecretary.Munchin, she’$ $till employed!

  26. I check Zillow almost every day for housing under $400K around the Bay Area and Northern Ca, I’ve noticed that around 60% of new listings have that god awful gray interior paint so popular with flippers. It makes me wonder if investors are starting to sell in droves. Real estate agents around here are contacting me telling me what a great time to buy it is and expecting 10% off but the price cuts Im seeing are already more than that.

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