They LIED | The TRUTH about the Housing Market CRASH

we gotta talk about this all right so

there was a new housing statistic that

just came out obviously if you've been

living under a rock you don't yet

realize

what my thoughts are on housing and

they're very simple there's a coupon

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new content we've got some new lectures

coming out in the real estate courses as

well but no really we got to talk about

the housing market so you already know

you should know by now my housing

expectations as rates started going up

in january we expected we would see

excess demand evaporate when excess

demand evaporates the housing market

could still be stable as long as supply

does not increase most real estate

agents in january were going on tick

tock saying the house market can't close

there's no supply and i'm like yeah

there's no supply because you have

substantial excess demand because

30-year mortgages are 2.8 freaking

percent

no surprise all of a sudden when you

jack that up three percent to about 5.8

what do you end up with well you end up

with 30 percent less buying power so you

absorb the demand the excess demand that

you have but now beyond absorbing the

excess demand that you have new people

aren't coming in when new people aren't

coming in because mortgage applications

are down 70

week over week all of a sudden you go

uh-oh you've got some leftover buyers in

the market right now but you're going to

squeeze out the existing buyers and

you're going to get a new wave of buyers

who are going to be able to pay less

because their pricing their purchasing

power is substantially declined the

concern here is that more houses than

sit on the market if more houses sit on

the market longer then inventory levels

begin to build now

even as recently as a few days ago the

tick tock real estate experts were still

telling us that don't worry supply is

still at all time lows sure it's up a

little bit but it can't keep going up

sure it can because when you remove

buyers from the market we're about to

take a look at a statistic here from

that just came out when you remove

buyers from the market what happens

you potentially have houses sit longer

as soon as houses start sitting longer

what do sellers potentially or owners

whether they're institutional owners or

investors or potentially even homeowners

what do they say

well i can't refinance because the fees

are insane to refinance investment

properties probably going to cost you

six and a half percent right now on a

30-year fix that's insane and it'll

probably cost you two or three points at

that which is even more insane

so you're not going to do that

the banks have stopped doing rental

property lines of credit so what are you

stuck with

holding and not getting cash to go buy

the dip in stocks or selling

and more people decide to sell that's

when you actually start getting cracks

in the real estate market where now

inventory can really start building and

you actually get price decreases so

what's the latest statistic that just

came out well i don't know because i

haven't watched this video yet i just

saw the title housing supply improves

after a drop in sale due to high

mortgage rates okay whatever let's see

what the actual numbers are i think it's

too early to actually see major changes

but we can start seeing little

indicators so let's take a quick little

listen here now to a key pillar of the

economy housing and a new report that

points to a major shift but is more

homes for sale a good sign or a bad sign

diana oleg joins us from washington with

the latest and the decision diana

i don't know if i have the decision

court but i got the numbers so the

supply of homes for sale could post its

first year-over-year increase in three

years and it could happen in just the

next few weeks that according to new

data from realtor.com inventory was 12

lower in april but that was the smallest

year-over-year decline actually since

the end of 2019 and another reading

covering just the last week in april

shows inventory down only three percent

from a year ago so realtor.com's chief

economist danielle hale said april data

suggests a positive turn of events is on

the horizon for weary buyers of course

not for sellers weaker affordability is

translating into fewer potential buyers

and a slowdown in bidding wars the shift

in supply is due to that drop in sales

thanks sorry folks give me one second

what i'm going to do is i'm going to

mute that discord that's pinging in the

background sorry i actually hate

notifications you know one of the things

i always talk about is turning

notifications off but i just reinstalled

discord on this and you get

notifications which is the perfect spot

to mention by the way that if you're not

part of the at least the free sections

of discord join me in discord uh go to

metkevin.com chat and that's the discord

invite anyway let's keep going we gotta

add commentary on this the recent spike

in mortgage rates which has made already

expensive homes even pricier the average

rate on the 30-year fix has jumped more

than two and a half percentage points

since the start of this year and home

prices are up about 34 since the start

of the pandemic now the growth in supply

is being led by mid-sized family homes

as fewer are going under contract

despite this being the heart of the

spring market which is when that family

demand usually happens most courtney i

am curious diana why is the growthman

supply being led by mid-sized family

homes can you elaborate on that a bit

i would say prices it just has to do

with affordability when you see mortgage

rates go that much higher and you're

already looking at a pricey home like a

big one like this one it's going to

knock people out of that market uh

perhaps they want the lower priced homes

but there are very few of those

available so you already had more of the

higher priced homes there to begin with

then they become even pricier they sit

longer they don't go under contract

supply just balloons

boom that was a really so really.com

hold on let's go i want to pull this up

that was very insightful because see

here's here's the way that the markets

work and this is sort of uh an analogy

that i really like using some people

think it's weird i know i thought it was

weird when i first thought of the

analogy or heard of the analogy but a

lot of folks look at the housing market

as kind of like a hand okay so each

finger is kind of like the very high end

you know the very low end and then you

got like the middle end the upper middle

and the lower middle end right uh and

you generally you don't get a crisscross

because like why would a middle and home

be selling for more than an upper end

home right and so people and the same

thing goes for multi-family you can kind

of stick it in in the various different

aspects as well depending on sort of

where it is and so people have this

impression that oh well you know you

know uh certain aspects of real estate

whether it's multifamily or condos or

single family or whatever that certainly

are going to do substantially better or

substantially worse than others that may

be true because you kind of have the

finger analogy of that wobble between

the different sectors like for example

condos fell like 55 in some areas where

homes and multifamily fell somewhere

around 45 to 48 so you had a little bit

of a delta there back in the 08 crash

right but you generally don't get a

crossover and so what we're seeing is

more inventory in the high end now we're

starting to see more inventory in that

upper midsize section dude the entire

section is going to move up with more

inventory and when the entire hand gets

more inventory you start getting prices

coming down at the same time as you get

rates going up that's why

you have this chart and that chart is

about to balloon mark my words you want

to get ready to shop for real estate in

my opinion at the end of this year

beginning of next year learn everything

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