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I Was Misled, I Can’t Sell My House, It’s The Classic Tide Going Out Thing

It’s Friday desk clearing time for this blogger. “Some listings are still getting multiple offers, but it’s not the frenzy that was happening six months ago, according to Youngstown Columbiana Association of Realtors President Dennis Gonatas. Gonatas said he had a client that had to withdraw an offer on a property because of the rise in interest rates. ‘They went from 3% to 5.75%. They were in the 3s, but you are not locked into your interest rate until you have an executed contract. If that takes you two, three, four months, you can only get the interest rate the market is offering at the time you get an executed contract. Unfortunately, it’s changed drastically,’ Gonatas said.”

“That change in interest rates changed the buyer’s payment by $700 a month. ‘I’m seeing some stabilization. You are still getting multiple offers, but instead of having 12 offers, you are getting two or three. I had a whole bunch of showings on a house a few weeks ago. It was a great listing, it sold within one day, and we only had one offer that was an acceptable offer to the seller. We weren’t in multiple offers, we didn’t go over asking price. If that would have been six months ago, it would have gone $5,000 over, $10,000 over,’ Gonatas said.”

“The housing market in South Florida is experiencing some mixed signals: There’s also been a slight bump in sellers dropping their prices.  Real estate agents report that recently, they’ve seen an uptick in new inventory heading back to the market, in part due to sellers wanting to partake in the hot market. ‘I do expect our marketplace to see an uptick in additional inventory across Palm Beach County, as I have had a notable number of sellers calling me to list their luxury homes this past week — [more] than in the past 30 days,’ said Bonnie Heatzig, executive director of luxury sales at Douglas Elliman in Boca Raton.”

“Sellers reducing the price of their homes in South Florida were at 13% in Palm Beach County, 11% in Broward County and about 9% in Miami-Dade County in March, representing a small increase from the month before, according to data from RedFin. ‘We have seen more price reductions lately, which is another indication of the market leveling off,’ said Brian Pearl, principal agent with the Pearl Antonacci Group in Boca Raton. ‘We have definitely seen more inventory come to market in the last month, which is great, but also a telling sign of what’s to come. This is the beginning of the market leveling off or correcting itself.'”

“Wells Fargo & Co. is laying off employees in home lending, with analysts saying the cuts were likely across all markets. San Francisco-based Wells Fargo confirmed the layoffs, issuing the following statement: ‘The home lending displacements last week were the result of cyclical changes in the broader home-lending environment. The employees affected by these changes have each been an essential part of our success. We are carrying out displacements in a transparent and thoughtful manner and providing assistance, such as severance and career counseling.'”

“Tom Brown, CEO at Second Curve Capital, said via email he thinks the layoffs were across all markets. He’s expecting a tough couple of years for mortgages. Dick Bove, an analyst at Odeon Capital Group, also thinks the layoffs were widespread. Bove believes the housing market has peaked. He estimates prices will start coming down in most markets by the second half of this year. ‘Mortgage banking is an accordion for banks,’ Bove said. ‘It’s not that, for example, North Carolina all of a sudden is getting hit by a major reduction in refinancing or home sales, and therefore, that’s impacting Wells in North Carolina, while South Dakota is doing fine. It just doesn’t work that way.'”

“Aaron Farmer, a Realtor at Texas Discount Realty, saw last winter as a perfect time to list a property, with prices at an all-time high and bidding wars fetching offers far above asking prices. Little did he know what he was in for. Farmer listed a south Austin condo at $359,900 for a client, and the bids poured in. The highest offer at $425,000 was 18% higher than the asking price. Just as Farmer was on the phone telling the second-highest bidder they lost, he learned that the first bidder had withdrawn the offer.”

“The first bidder likely ‘got cold feet and thought, ‘I’m overpaying,’ Farmer says. ‘I think my seller thought I was messing with him. He was a little upset because he saw $50,000 vanish.'”

“There are homeowners who bought in recent years and have enjoyed seeing their home equity increase in the double-digit percentages largely due to an unusual spike in home price appreciation. If these owners get ready to sell with the expectation that home prices will always appreciate 20% every year, they may be in for a rude awakening, housing experts say. ‘There are a lot of people who paid way too much for their house in the past two years,’ says Nicole Bachaud, a Zillow economist.”

“Boom times in residential real estate may soon be coming to an end. Average housing prices in Quebec are projected to fall 4.7 per cent in 2023 as rising mortgage rates begin to squeeze first-time buyers out of the market, Mouvement Desjardins said. ‘Even though many people seem to think this effervescence will go on forever, it’s getting very late and the party’s almost over,’ senior economist Hélène Bégin, who wrote the report, Desjardins is Quebec’s biggest residential mortgage lender.”

“‘A decline of 10 per cent for the Island of Montreal is very plausible because of the overbidding situation,’ Bégin said. ‘There’s a big gap between the price and the real value of the asset. People may have a hard time believing this now, but as soon as there are only two or three interested buyers, multiple bids become less frequent and prices start dropping.’ Homeowners who bought at the top of the market and need to sell quickly ‘will be the big losers,” Bégin predicted. ‘They probably won’t get back that $50,000 that they paid on top of the asking price. It’s a return to a certain normality.'”

“In the past 12 months mortgage broker Mark Mitchell has been hearing from a growing cohort of homeowners who want to join the booming business of private mortgage lending, despite the inherently higher risks. ‘The new ones who have called me say they are accessing the equity in their home via a Home Equity Line of Credit and they want to lend it out at 12 per cent,’ said Mr. Mitchell, a London, Ont.-based mortgage broker. What does he think happens when he turns them down? ‘I think they go down the list on Google and look for a broker that will take them on. That’s going to end well,’ he says wryly.”

“Some believe much of the damage may already have been done as the real estate market finally shows signs of cooling in 2022. ‘We’re going to find out a lot of people didn’t understand their private lending, a lot of investors and customers are going to say ‘I was misled.’ … It’s the classic tide going out thing,’ said Ron Butler of Butler Mortgage Inc. ‘The number of calls we get from people saying ‘I can’t sell my house, I need a private bridge.’ … These calls are up 400 per cent in two weeks.'”

“House prices are back to where they were a year ago in the Wellington region, according to the latest Real Estate Institute of New Zealand’s House Price Index. Trade Me’s Property Price Index for March shows the number of listings in the Wellington region was up 78% compared to the year before, the highest number of properties for sale on record in the region. ‘While supply skyrocketed in Wellington last month, demand in the region grew by a comparatively small 2% year-on-year in March,’ Trade Me property sales director Gavin Lloyd said.”

“Lowe and Co estate agent Adam Cockburn said the number of homes for sale had reached the highest point since June 2015. Cockburn said before homeowners became too fixated on value falls, they should keep in mind they had enjoyed five years of the biggest capital gains on record. He said a lack of properties on the market was a common complaint in recent times and fed into the idea there were not enough homes, but what it actually meant was sales were outpacing listings.”

“Outer suburban electorates of major cities, already home to many of Australia’s most financially stressed households, are facing a ‘huge cliff’ in coming years as their fixed-rate loans expire and they are hit with higher interest rates, analysts say. ‘It’s not strictly speaking mortgage stress,’ Prof Hal Pawson from UNSW said. ‘It’s people who are in financial stress who also have a mortgage.’ For those on an average mortgage of $600,000, adding three percentage points to the borrowing costs could swell repayments by $1,500 a month or more. ‘That’s going to be a lot for any household to swallow.'”

“‘There’s going to be some households that really have to take a long hard look at their budgets, and potentially make hefty cuts in numerous places to just keep their heads above water and their mortgage repayments up,’ said Sally Tindall, a senior researcher at RateCity. ‘We’re looking down the barrel at not just one rate hike in isolation. There’s going to be multiple hikes.’ In addition, ‘anyone who bought recently and potentially overstretched themselves to get into an overheated property market, they will feel the heat of these rate hikes, that’s for certain,’ Tindall said.”

“The Block auctioneer Tom Panos has warned real estate agents to brace for the looming housing price drop – with one of Australia’s biggest banks forecasting a plunge. The dramatic developments led Mr Panos to warn real estate agents that they may find themselves forced out of the profession and back to their old jobs in fast food. The KFC managers are going to leave real estate and head back to KFC,’ the real estate guru said. ‘And you know who’s going to stay behind – professionals, people who are going to know how to negotiate, and create urgency, where there is no urgency.'”

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  1. ‘If that would have been six months ago, it would have gone $5,000 over, $10,000 over’

    Winnahs! filling up the rear view mirror.

  2. ‘I have had a notable number of sellers calling me to list their luxury homes this past week — [more] than in the past 30 days’

    They can always sell.

    ‘Sellers reducing the price of their homes in South Florida were at 13% in Palm Beach County, 11% in Broward County and about 9% in Miami-Dade County in March’

    But it may be for less.

  3. ‘The first bidder likely ‘got cold feet and thought, ‘I’m overpaying,’ Farmer says. ‘I think my seller thought I was messing with him. He was a little upset because he saw $50,000 vanish’

    Ennio Morricone – the ecstasy of gold

    https://www.youtube.com/watch?v=dyg1mQ87ILg

    This is one of my favorite versions.

  4. You are still getting multiple offers, but instead of having 12 offers, you are getting two or three.

    Realtors are liars.

  5. Citizen! You WILL support the Current Thing.

    Biden blasted for policing free speech with ‘dystopian’ disinformation bureau

    https://nypost.com/2022/04/28/joe-biden-under-fire-for-dystopian-disinformation-bureau/

    Oh, (Big) Brother!

    President Biden came under fire Thursday for the creation of a “dystopian” disinformation bureau created under his Homeland Security department, which critics are blasting as just a way for the government to police free speech online.

    Conservatives slammed the Department of Homeland Security’s Orwellian new “Disinformation Governance Board” – with some suggesting the timing is convenient given Elon Musk vowed to make Twitter a free speech haven after his $44 billion takeover of the social media platform notorious for selectively censoring right-leaning points of view.

  6. The 2020 election was stolen.

    The Department of Homeland Security is not a legitimate government organization. They have no authority to prosecute “disinformation” because they are a Democrat Party terrorist organization.

    Glowies can’t silence this blog.

    We’re taking our country back.

    1. The Biden regime & the Democrat-Bolshevik globalist Quislings drop the mask a bit more each day.

    1. Dementia Joe & the Democrat-Bolshevik control freaks are beside themselves with envy watching the total arbitrary control their CCP ideological mentors wield over the disarmed populace.

  7. “In the past 12 months mortgage broker Mark Mitchell has been hearing from a growing cohort of homeowners who want to join the booming business of private mortgage lending, despite the inherently higher risks.”

    “Some believe much of the damage may already have been done as the real estate market finally shows signs of cooling in 2022. ‘We’re going to find out a lot of people didn’t understand their private lending, a lot of investors and customers are going to say ‘I was misled.’ … It’s the classic tide going out thing,’ said Ron Butler of Butler Mortgage Inc. ‘The number of calls we get from people saying ‘I can’t sell my house, I need a private bridge.’ … These calls are up 400 per cent in two weeks.’”

    “You never know who’s swimming naked until the tide goes out.” – Warren Buffett

    “The housing market in South Florida is experiencing some mixed signals: There’s also been a slight bump in sellers dropping their prices. Real estate agents report that recently, they’ve seen an uptick in new inventory heading back to the market, in part due to sellers wanting to partake in the hot market. ‘I do expect our marketplace to see an uptick in additional inventory across Palm Beach County, as I have had a notable number of sellers calling me to list their luxury homes this past week — [more] than in the past 30 days,’ said Bonnie Heatzig, executive director of luxury sales at Douglas Elliman in Boca Raton.”

    – You meant: ‘due to sellers wanting to partake in the hot market…‘ ‘due to sellers wanting to sell as the housing bubble is now bursting…’ It’s a rush for the exits.

    – Everyone is now rushing for the exits. Trying to time the market. The financialization of housing and virtually everything in the economy was a wonderful thing. (Not!)

    “Aaron Farmer, a Realtor at Texas Discount Realty, saw last winter as a perfect time to list a property, with prices at an all-time high and bidding wars fetching offers far above asking prices.”

    “There are homeowners who bought in recent years and have enjoyed seeing their home equity increase in the double-digit percentages largely due to an unusual spike in home price appreciation. If these owners get ready to sell with the expectation that home prices will always appreciate 20% every year, they may be in for a rude awakening, housing experts say. ‘There are a lot of people who paid way too much for their house in the past two years,’ says Nicole Bachaud, a Zillow economist.”

    – “Rude awakening” indeed. Apparently they didn’t learn the lesson from housing bubble 1.0. Never do.

    Boom times in residential real estate may soon be coming to an end. Average housing prices in Quebec are projected to fall 4.7 per cent in 2023 as rising mortgage rates begin to squeeze first-time buyers out of the market, Mouvement Desjardins said. ‘Even though many people seem to think this effervescence will go on forever, it’s getting very late and the party’s almost over,’ senior economist Hélène Bégin, who wrote the report, Desjardins is Quebec’s biggest residential mortgage lender.”

    – The party’s over. Enjoyed the boom? Now enjoy the bust.

    The Block auctioneer Tom Panos has warned real estate agents to brace for the looming housing price drop – with one of Australia’s biggest banks forecasting a plunge. The dramatic developments led Mr Panos to warn real estate agents that they may find themselves forced out of the profession and back to their old jobs in fast food. The KFC managers are going to leave real estate and head back to KFC,’ the real estate guru said. ‘And you know who’s going to stay behind – professionals, people who are going to know how to negotiate, and create urgency, where there is no urgency .’”

    – “Professionals.” – “professionals, people who are going to know how to negotiate, and create urgency, where there is no urgency.”

    “Sha na na na, sha na na na na
    Sha na na na, sha na na na na
    Sha na na na, sha na na na na
    Yip yip yip yip yip yip yip yip
    Mum mum mum mum mum mum
    Get a job, sha na na na, sha na na na na”

    – Oh my! Someone may actually have to work for a living? The Aussie economy is all about housing. What happens now that the party’s over? That could be quite a hangover. Enjoyed the boom? Now enjoy the bust.

    – So much cratering. It’s a global phenomenon. Central banks are a plague on the planet. A pox on them! And not to mention the complicit governments and gullible buyers. It’s a Mad Mad Mad World.

      1. It would be a tad embarrassing for a former Realtor(tm) to have to deliver a pizza to a house he sold to some FBs.

        “Oh, hey there Bob. Yeah, I had to make a career change.”

  8. This is where Fauci and the Democrat-Bolsheviks would’ve taken us, if they hadn’t faced so much resistance.

    The great Zero Covid escape: Defiant Shanghai residents break out of their own homes after being imprisoned under discredited policy – amid warnings Chinese economy is in the ‘worst shape in 30 years’ thanks to crackdown

    https://www.dailymail.co.uk/news/article-10766647/Defiant-Shanghai-residents-break-homes-trapped-metal-cages-houses.html

    Residents of Shanghai who were fenced into their homes by Communist officials as part of China’s draconian Zero Covid policy have staged a break out, video posted to social media showed today.

    The clip shows the metal fences built along a residential street to trap homeowners indoors have been brought down.

    Shared via state-approved messaging service WeChat, the video from financial district Pudong was reportedly captioned: ‘Actions speak louder than words.’

  9. Can’t sell my house – or cannot sell the house for the asking price. If there is a chance that prices will drop even more – why take the risk of getting a bridge loan – take less money and run.

    I am stunned by the bad decision making – but of course the Fed lead in this category.


    ‘The number of calls we get from people saying ‘I can’t sell my house, I need a private bridge.’ … These calls are up 400 per cent in two weeks.’

  10. Is it safe to assume the stock market has finally stopped falling and can only go up from here?

    1. The Financial Times
      Markets Briefing Equities
      US stock futures fall after disappointing updates from Amazon and Apple
      European shares diverge from Wall Street after being lifted by Chinese stimulus pledge
      People line up for Covid-19 tests at a Beijing office complex
      Chinese authorities have vowed to safeguard the world’s second-largest economy from coronavirus shutdowns
      © AP
      Naomi Rovnick in London and William Langley in Hong Kong
      2 hours ago

      US equities were poised to fall on Friday, following weak results from tech titans Apple and Amazon, while sentiment in Europe was boosted by a fresh economic stimulus pledge from Chinese authorities.

      The regional Stoxx Europe 600 share index added 0.6 per cent, after gains in Asia, where Hong Kong’s Hang Seng index closed 4 per cent higher.

      But futures trading implied Wall Street’s benchmark S&P 500 share index would open 0.9 per cent lower in New York, as it heads towards a more than 5 per cent loss for the month. Contracts tracking the technology-heavy Nasdaq 100 were down 1.1 per cent. The broader Nasdaq Composite is on track to fall more than 9 per cent in April in what would be its worst monthly performance since March 2020.

    2. “Is it safe to assume the stock market has finally stopped falling and can only go up from here?”

      – I know this is sarcasm, but I’ll bite.
      – You know what they say about assumptions… 🙂
      – Just look at the correlation between the Fed “balance” sheet and stonk prices (e.g. S&P 500 index). This is highly correlated.
      https://fred.stlouisfed.org/series/WALCL
      – All one needs to know to be an “investor” today is the direction of the Fed’s “Large Asset Purchases” balance sheet. It appears that the balance sheet is JUST NOW starting to roll over. May (starting Sunday, BTW) is supposed to be a “shock and awe” month for this as the Fed has said they’ll shrink their balance sheet via QT and actually raise interest rates in a meaningful way. We’ll see, since the economy “can’t handle the truth” of tighter liquidity, color me very skeptical.
      – With “officially” reported inflation at 8.5% (very high and with the real number likely 2x this) last month via the BLS (BS?) CPI, and yet GDP at -1.4% (negative growth), what can they do? They’re screwed, and by living in this bizzaro world / clown world economy, by association, so are we.
      – Summary: The Fed is removing the punchbowl of excess liquidity from the financial system, at least until “something breaks.” Stonks, bonds, and housing are responding appropriately. The stonk bear market, along with the slow motion train-wreck of the bursting of the everything bubble, continues apace. Invest accordingly.
      – The Fed: “How to destroy the American free market economic system.” The wrote the book, and yet they’re still there. Congress is useless. I’m not feeling very represented.
      – This will get resolved one way or another.

      1. The major stock indexes are merely barometers of Fed inflation. There is no stock market, it is only a grand facade erected to separate fools from their inflated money. Invest in yourself.

  11. My appetite is whet for the first article I see that advises “today’s buyers” to make up the difference by taking on a side hustle, going back to school, or focusing on meditation, wellness, and enlightenment, sufficient to wave that extra $700 payment their way.

  12. A dumb azz gives his life for the cause of globo homo:

    An American citizen and former Marine, Willy Joseph Cancel, has died in Ukraine while fighting alongside Ukrainian forces, according to the man’s family. It is the first known death of a U.S. citizen fighting in Ukraine.

    1. He died for an unelected globalist who was installed by the CIA, and who dances in leather pants and heels.

      “They’re not sending their best”

  13. Noticing big uptick in Texas inventory. During April, former white hot areas Austin, Georgetown, Cedar Park and The Woodlands are all seeing a +20% increase for the month. Meanwhile OC So Cal a measly +5%.

  14. A very merry CR8R Day to you.

    From p. 1 of today’s dead tree edition of THE WALL STREET JOURNAL:

    “Amazon Has First Quarterly Loss in 7 Years”

    “U.S. Economy Shrinks 1.4%, But Spending Stays Strong”

    1. Amazon Has First Quarterly Loss in 7 Years

      I haven’t read the report. Was it due to write offs, or did they just s#ck?

        1. Rivian

          I was blown away when they were briefly the most “valuable” automaker in the world even though they hadn’t sold a single vehicle.

      1. Totally irresponsible.

        Up to now, I always considered Fidelity to be a legit organization.

        But then again, when you can sell and (re)sell a limited supply of nothing, it must be just to much to resist.

        1. Comment Addendum:

          Don’t any of these organizations have *any* integrity anymore?

          Or are they taking cues from the REIConplex, where all that counts is how much money you can screw out of everyone?

      2. This sounds like a “hint.” Last week MarketWatch posted an opinion piece where the Bank of International Settlements praise CBDCs. That piece was a MASSIVE hint and I suggest people read between the lines on it. (Search Marketwatch for “Queen Maxima.”) Now the Department of Labor is “concerned?” I think someone is dropping hints that TPTB are going to simply going to “adopt” (in the crypto sense of the word) CBDCs and dethrone Bitcoin.

        IMO Bitcoin is “backed” by the anticipation of widespread adoption. But with no adoption, Bitcoin has no reason to exist. Watch out, Saylor.

  15. “‘Mortgage banking is an accordion for banks,’ Bove said.”

    interesting metaphor. or simile.

    (now let the endless snark commence over those definitions & how they are applied)

  16. Every Realtor dummys up in a hurry the very second appraisal fraud is mentioned.

    Why is that?

    1. Maybe.

      October is in Q3, and is the traditional CR8R month on Wall Street. So I could see the Fed considering then as a time for intervention.

      However, a 15%+ inflation rate is a bit of a gamechanger. I have a hard time imagining them restarting QE before inflation is evidently and substantially under control.

  17. So far, there’s no bottom to the CR8R in view.

    Down, down, down the rabbit hole we go.

    Weeeeeeeeeeeee!!!!!

    1. Last Updated 12 hours ago
      Dollar dips, U.S. stocks tumble on inflation concerns
      By Sinéad Carew
      4 minute read
      A broker looks at a graph on his computer screen on the dealing floor at ICAP in London, Britain January 3, 2018.
      REUTERS/Simon Dawson
      Summary
      – World stock index off, shows weakest month since March 2020
      – U.S. stocks weighed down by inflation, Amazon earnings
      – Nasdaq loses 4% on day, registers biggest monthly dip since 2008
      – Dollar dips Friday but set for biggest 1-month gain since 2015
      – U.S. Oil futures settle lower, gold rises

      https://www.reuters.com/business/global-markets-wrapup-1-2022-04-29/

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