Terrible News for the Housing Crash

hey everyone me kevin here oh my gosh we

just got a new report out that home

sales are starting to plummet there are

two categories here luxury and

non-luxury

this is just feeding into all of the

data corroborating all the data that

we've been reporting over the last few

days and here's yet another report ready

for this in february march and april

during that three month period

luxury home sales fell 17.8 percent now

that's not prices that's areas the

biggest drops are in places like long

island new york oakland california

dallas and austin texas and west palm

beach these are the biggest drops

now these are also the biggest declines

that we have seen since the start of the

covid lockdowns which is crazy because

when we locked down of course sales

plummeted sales plummeted because

everyone was locked down now we have the

biggest drop since then that's a bad

comparison non-luxury transactions in

that same time frame are down 5.4

percent now what's important to know

is that even though luxury home sales

are down like three times as much as

non-luxury home sales this only goes

through the end of april

may i think is going to be even uglier

so when we do that three-month analysis

between may june july it's gonna be

nasty why do i say that well because of

what we've been talking about in prior

days we've seen active listings inflect

up and we've also seen active listings

with price drops skyrocket we can go to

the redfin data center you could see it

nationally you could type in your local

market then we've got something else

that's also hurting us which i'm going

to talk about but couple these three

things really quickly together so this

is why you know what's going on

loss of purchasing power due to interest

rates now you're seeing more price drops

with more inventory coming on the market

and fewer actual transactions it's a

recipe for disaster prices will probably

end up going negative at this rate this

year we'll see we've got some big gains

in january and feb though so we'll see

if we can if we end up going negative

relative to those or we end the year

positive but we're on you know a

declining trend for 2023 right which is

exactly what i'm preparing for i'm

preparing for going shopping like crazy

for real estate in 2023 because

hopefully by then the stock markets were

covered a little bit i freed up as much

cash from having sold my real estate got

some cash on the side and i'm going

shopping and getting loans again in 2023

and that's another beautiful thing about

see like i was maxed out personally like

between us and nobody else

i was maxed out with loans i had to get

stupid commercial financing that sucked

for single-family homes i was maxed out

uh and now because i dumped a bunch of

properties i could go buy another 15

wedge deals with fannie freddie loans

again i'm like yeah let's go but anyway

i'll talk to you about all of this in

more detail

of course in the programs link down

below on building your wealth but we got

to talk about something else that's

pretty ugly that's happening in the

market right now do keep in mind there's

an expiring coupon code down below 50

off it's the biggest coupon we've had

but when that expires we'll have another

price increase because we've got new

lectures coming up as soon as i'm back

from canada but anyway the big thing

that's happening now is that inflation

report that you i know you've already

heard about this morning complete

disaster 10-year treasury real

yields which link with mortgage yields

they don't actually play together but

they tend to work in the market together

they correlate very well together uh

10-year treasury yields just jumped 10

basis points they were up as much as 15

basis points this morning we're now

sitting at 3.15

which is pretty spectacularly high we

are higher than where we were at any

point before during this uh you know

post pandemic recovery and we're now at

the highest point uh and we're actually

higher than where we got to in 2018

which is when donald trump threatened to

fire jerome powell because rates were

getting so expensive that's because this

inflation report is leading a lot of

people to expect that we're going to get

a 75 bp hike that we're going to get

either rug pulled by the fed with a

surprise meeting or they're going to

move up all their rate hikes that's

going to do nothing other than push

treasuries up in addition to pushing

treasuries up if we end up sitting at

3.25 with treasuries up and then we

actually get the quantitative tightening

impact which we expect to really start

feeling within the next six to 12 months

we're going to get another 25 to 50

basis point hike on top of that 10-year

yield we'll be sitting at something like

three and a half to maybe even four

percent ten-year treasury yields that'll

skyrocket mortgage rates and we could be

looking at six and a half to seven

percent so we're seeing the trend on the

10-year move up at the same time we just

got this report on transactions starting

to plummet this is how it starts people

keep saying and i'm tired of hearing it

oh but the housing market can't crash if

if there's a lack of supply well what

happens the stuff people sell every

month let's say every month people sell

put 100 homes on the market

how do you get new supply well if you

used to sell 100 homes for every 100

homes you put on the market what happens

if you only sell 50 homes well now every

time you add 100 you're adding to that

base of the prior 50 and now you get big

selection for buyers and people who want

to sell have to drop their prices and

you get lower transactions combined with

that and all of those things are what

we're starting to see the slower prices

are coming that part's coming but the

other indicators are lining up and i

just want to be prepared and make sure

i've got everything all my ducks in a

row to make sure i can go shopping for

real estate when these prices come down

lower again that's going to be getting

educated in real estate getting educated

property management getting my

connections straightened out i want to

make sure i can get financing what can i

do now to bump my income to make sure i

can qualify for all the homes that i

want to buy all the fixers i want to buy

these are the and you also want to start

identifying what areas do you want to

buy in and what kind of property do you

want to acquire if you're unfamiliar

with any of these things programs link

down below on building your wealth check

them out use that coupon code and we'll

see you soon bye