Real Estate is STARTING to *CRASH.*

we've been talking about housing on this

channel for a while now okay but today

we really got to talk a little bit more

about some of the things that have

started a car back in january we really

talked a lot about how look when the

10-year treasure goes up hits three

percent we're gonna see mortgage rates

in the five to six percent range this is

what slowed down the housing market in

2018 the housing market lost 12

in the span of two months once home

buyers reacted now today things are a

little different we've got a lot of

excess demand in the home buying market

and so what happens is when interest

rates go up one percent we tend to see a

reduction of 10 in purchase power we

know this is old math at this point we

learn about this not only on the channel

but of course in the programs on

building your wealth with uh real estate

and do-it-yourself property management

and rental renovations uh but we go much

deeper than that and for example one of

the things that we got to know is that

if we have excess demand right now 30

and interest rates go up three percent

cool well now maybe we have an equal

level of supply and demand right the

question is could we potentially overly

compensate for excess demand end up with

now more supply than demand which leads

prices to kind of start curving a little

bit and does that potentially lead to

fear well 10-year treasury right now

sitting at a 2.97 percent moving back up

on that neighborhood of 3

and on top of that we just got a report

here that uh in vancouver they're now uh

seeing evidence of a sharp decline uh in

their housing market now usually when we

hear sharp decline like there are many

different matrices that we can look at

for uh you know a steep slow down or or

whatever right and what they're talking

about is that seasonally adjusted home

sales in april declines sharply by 22.8

compared to march this is now the third

monthly decrease in a row the concern

with this is that if you're not selling

as much inventory as you used to you

start basically building up inventory

more and that means you start getting

into the direction of oversupply while

at the same time as having higher

interest rates higher costs lower

purchasing power there's really only one

direction that prices go after that now

this is the third monthly decline that

they've seen in the metro vancouver

housing market uh third in a row uh and

uh

now they see that on the supply side the

number of properties listed for sale in

april shot up 5.3 percent in march that

is now the fourth monthly increase and

you're kind of seeing murmurings of that

same thing happening throughout the

country where now you're finally

starting to see housing supply

kind of do do this like the slow kind of

s-curve ramp right and you're getting

the reverse like the slow kind of

s-curve to the downside ramp of of price

appreciation and sale so those are

things to keep in mind uh and certainly

they're entirely likely to cross uh but

anyway uh bloomberg is also and this is

the other thing that i've been talking

about regularly that you have to watch

for is it's not so much like what's

actually happening that scares home

buyers or whatever it's like literally

what are people saying on the internet

right now that could be totally wrong

it's entirely possible the housing

market soft lands fine we have higher

rates for a couple years they'll come

back down i widely expect rates to come

back down i think people are going to

have a great opportunity to refinance

down and they probably not financial

advice shouldn't like pay money to get a

higher or a lower interest rate just

take the higher rate take the credit and

then refinance in the future but now

you've got bloomberg saying that in

march a measure of u.s housing

affordability fell to its lowest level

since oh wonderful year to compare to

2008 housing is only getting less

affordable uh in the coming months the

fixed home buyer index fell to 124 in

march from

134 the prior month according to the

association of realtors with declines

signaling that homes are becoming less

affordable

that's no surprise and then they go on

to uh to give some examples of how much

it costs now uh for for an average 400

000 home versus not and that's not so

much important what's really important

is that we know purchase power declines

10 for every 1 that we see rates go up

so these are definitely things that we

want to pay attention to in the housing

market mostly because that could also

trickle over to the stock market if we

start seeing people's impression of

wealth decline because their underlying

assets have lost value then they're less

likely to spend like loonies on

travel or or

you know

goods and you know new refrigerators or

solar panels or end phase inverters i

hate saying that okay i hate saying that

because i love in face but let me just

tell you and i might be really early

with it but if people's home values are

going down i guarantee you days not

putting all solar panels at least not at

the rate at which they they were

previously right like somebody's still

gonna buy solar panels it's not like

these companies are gonna have their

business go to zero uh but but yeah

expectations will be yeah

anyway

my thoughts okay