Episode 55: What Is Going To Happen To The Housing Market?

On today's episode of the Jerry and Jacobe Podcast,  hosts Jerry and Jacobe will talk about the housing market and real estate. They are always being asked what their opinions are on what is going to happen and and what they think will go on in the future for home buyers and sellers. Tune in.

 

Episode Highlights: 

• It doesn't matter if we are at church, baseball games, or coffee shop, everyone is talking about how the housing market is “crazy”. The real estate industry seems to throw the word crazy around a lot right now, too
• The people Jerry talked to, mainly in retail real estate, say the rates do not drive the determination of whether it's time to buy a house or not.
• No one is waiting around for the perfect time to buy a house. One buys the house when one needs it, says Jacobe.
• 15 to 20 years ago, Midland was the hottest real estate market, and you couldn't find a house, and it was the same as everybody else. As per Jacobe it's not as crazy as it was during that time.
• The real estate is local too; Just because it's doing something in one part of the United States does not mean it's doing the same in another.
• Interest rates are not going to drive demand down as far as how many people are buying houses because they may buy a smaller house, says Jacobe.
• People will start saying that the housing market is slowing down. But it's not slowing down, it's still crazy, and you still are getting offers.
• The Scholastica Corporation says that the average consumer is spending $429 an additional per month for the same items they bought a year ago because grocery and gas prices are increasing.
• As the prices of groceries and gas are increasing with increasing values, property taxes are also going up.
• If you have a mortgage and it's escrowed in with all your payments, your payments are going up regardless because housing values are going up, says Jacobe.
• The lumber prices are coming down now, but with all the inflation and prices going up, a builder can't build a house at the same price they could build it for in the past.
• It doesn't matter if the builder borrows money, or he is paying cash. He still has to be able to make a profit. And to make a profit, you have to create something for less cost than what you sell it for.
• Builder's profit has more to do with material costs and labor issues; Also, you have to have a reason and incentive to build.
• More people are on the planet than in the past, so we need more housing, but the question is: How do we get the supply up? and How do we make it more affordable for people?
• If you are on a fixed income or on a job where your pay isn't increasing, and housing costs are increasing, then people have to make changes, and all have a ripple effect.
• It doesn't matter if you're going to buy a house or if you're leasing a house; Your housing cost is going up regardless.
• Jacobe has read in the White House article that they are changing up financing and trying to help people get more financing. What does it mean?
• Most people aren't accepting what FHA offers right now because people are using a conventional or higher down payment product.
• Until we start fixing the supply issue, we are not going to be able to fix the problem of price hike, and it will continue to go up.
• Affordable housing will be an issue in the near future, and many people are investing in mobile home parks.
• The main question is, affordable housing prices are still going up but is the market going to crash? Because that's what everybody wants to know.

 

3 Key Points:

1. If you watch Fox News, CNN, they are talking about baby formula shortages, and then they are talking about the housing market. They are focusing on the trending topics with the goal of entertainment more than facts and helpful information.
2. The President's 2023 budget includes a mandatory spending proposal that would provide 10 billion in HUD grants to reduce affordable housing barriers for States and localities that have already adopted forward housing policies
3. One of the things that come up in conversation all the time is that having the forbearance program implemented during COVID, foreclosures will come to help with supply and demand. Was it true though? How has it affected where we are today?

 

 

Resources Mentioned:

• Jacobe Kendrick  Facebook| LinkedIn | Instagram |YouTube|
• Jerry Weaver   Facebook | LinkedIn | Instagram|
• Success Without Sacrifice Facebook page
• BJJ Realtor YouTube 
• https://www.weaverrealtypro.com/
• https://www.whitehouse.gov/briefing-room/statements-releases/2022/05/16/