Gilberto de Piento wrote: ↑Fri Dec 07, 2018 10:12 am
Another sign pointing to a possible recession. Anyone getting nervous yet? Or are you excited, hoping to buy assets on sale? Personally, If the market tanks or moves sideways for a long time it may be difficult for me to be as excited about investing.
I'm looking to buy a house in a very overpriced area in the next 2-3 years, I'll probably buy regardless just to lock something in (I hate moving, and that seems to be a constant with rentals), but I am really hoping I can wait out the insanity and get a deal.
That said, who knows? Debt is at record highs everywhere I look, so it seems like someone is going to have to pay the piper at some point, especially with interest rates rising. I am very curious what the interest rates are going to do to the real estate market. By my reasoning, anyone who bought a house with a minimal down payment in the last 3 years is now underwater or will be soon as interest rates continue to rise. So it may be that they all just stay put and are stuck for the next 10 years, or it may be that jobs contract and they start losing them. Could also be that people start walking away at some point just from being demoralized that they are underwater? I don't know. I knew a few people who walked away from houses they were underwater in during the last crash, because they hated being stuck, even though if they had waited 10 years they would have been okay.
I am also curious if the real estate market is still warped from the last bubble. I wonder if a larger percentage of home owners are going to stay in their homes for the long term which would decrease supply instead of swapping them out more often. It seems like anyone who bought in the 70s-early 2000s did extremely well in real estate because interest rates were crazy high then dropped, and the trend was that they traded up using their gains every so often. My generation is on the flip side of that, interest rates will either remain stable/low or go up, because they can't go any lower than they have been. I don't foresee wages skyrocketing in the next 10-20 years either. Maybe real estate is a losing game in the long term right now?