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We are. And we're gonna die waiting for that moonshot, which means plan for retirement.

 

In that case, I’m ok treading water for a few years. I’ll stay diversified and see how it shakes out.

 

I'm pretty sure anything we make will be taxed until we die.
The rest is a crapshoot.

 

You could be very right on the value of "real" assets....like real estate. I've heard that there is a shortage of housing, which is pretty evident by the rapid increase in house prices over the last 3 years. This could have been avoided by home builders continuing to build homes between 2010 and 2020, but supposedly they were not building as many as they could/should - as it was not as lucrative - and that has lead to a decline in the number of available quality houses. Had home building been at a sustained rate and not been underperforming over the previous decade, we'd have more available homes and the prices wouldn't be so inflated.

Supply and demand.

That's just what I've read. It doesn't make a whole lot of sense to me about the available "quality" houses. Seems that houses would be build to satisfy the need. We didn't just all of a sudden have a bunch of homeless become high income earners and buy up all the cheap housing, so how can you (the proverbial you) say that home builders should have been cranking out houses when there weren't any buyers?

I think the housing market is one of the most inflated areas of investment currently. In 2011, I bought a 1500 sq. ft. starter home for $115k. That home is now worth over $300k! Not only has it nearly tripled in value, it is now 10 years older and has been used as rental for at least the last 5....which means that it likely hasn't had the same level of care as would generally be provided by an owner occupant.

Salaries have not tripled in that time frame. Someone starting out in life right out of college is likely to earn an estimated $50k (this is my estimate based on people I know who recently graduated college. I have not looked at any articles or charts). You cannot have starter homes priced in the $300k+ range and expect things to remain on the current trajectory. It isn't sustainable. I think it is equally likely that we have a correction and the price of homes fall dramatically.

After the 08-09 crisis, banks got slapped on the wrist for loaning money to people who really didn't, or shouldn't, qualify for the loan. They remediated things by having stricter guidelines on loan-to-value, debt-to-income, and credit scores in order to obtain a loan. What they didn't do anything about was the price of homes. How could you? Of course you expect the value to rise with time. So what we are seeing now is a lot of people who technically qualify for the loan, but are spending upwards of several hundreds of thousands over market value. (that last sentence was not a mistake. A home in my neighborhood just sold for $150k OVER what the market comps say it should have been sold, and I'm not even in the "rich" neighborhood.) This in turn causes other homes to sell for more than they should and the cycle continues. At some point, we're going to see a lot of people in homes that they really can't afford. This leads to missed payments and eventually foreclosure. Eventually things will balance out.

If you had real estate purchased for rental property prior to 2019, you will probably do well over the next 10. If you didn't, I'd be very hesitant to purchase some now because no one knows what will happen with the market (stock or housing).

 

The above post is pure speculation and meant to contribute to @jandrews conversation starter.

I could be 100% right or wrong. If previous performance is any indication of future gains/losses, I wouldn't put any stock in what I said. I thought that COVID was going to reduce the cost of housing. We saw a legal increase in the forbearance period to help keep people from being foreclosed on during the pandemic. I thought for sure that we were going to see a sharp increase in the number of foreclosures at the end of the forbearance period.

That didn't happen and the forbearance period has long expired. Home prices continued to rise.

 

been bullish on PQEFF this week

the new CEO has announced his support for the take over and is going to tender his shares all while this Anthony Cantone guy (think he was previous CEO) has been buying $100k worth daily for the last 2 months

https://www.marketscreener.com/quot...nd-CEO-Mr-Alex-Blyumkin-Supports-th-39898854/

https://www.marketscreener.com/business-leaders/Anthony-J-Cantone-05ZJBQ-E/biography/

https://fintel.io/n/us/pqeff/cantone-anthony-j

 

Some more info on that for you:

Underbuilding has been a big problem for over a decade:
https://www.cnbc.com/2021/09/14/america-is-short-more-than-5-million-homes-study-says.html

Skilled trades see worsening labor shortage:
https://www2.staffingindustry.com/E...ction-high-but-labor-shortage-worsening-59116

Builders are having trouble getting the materials they need:
https://www.businessinsider.com/home-construction-materials-shortage-supply-chain-home-depot-congress-2022-1#:~:text=Home builders can't find,2022 because of this delay.

Current buyers have excellent credit and are putting down large down payments - this is not 2007 over again:
https://www.wsj.com/articles/the-pa...t-its-different-from-the-last-one-11615824558

Combine all these with the fact that real estate tends to do very well in mitigating inflation, and our current high-inflation environment...yeah, it's a perfect storm. And this is before we discuss the universal constant of over 60% of the country being homeowners and WANTING restrictive zoning that prevents building and increases property values. Politicians will NOT anger that voting bloc, so that will not change.

This may be the tipping point where the US becomes much like the UK, Canada, Australia, etc. where housing prices are affordable essentially only to the upper classes and the bottom 60% is essentially a tenant class.

I'm not gonna lie: I'm tilting toward REITs in my portfolio right now.

 

Well, material prices and labor prices increased, plenty of people were financially unscathed by Covid, and mortgage rates were so low, it created an odd scenario for demand when most thought there wouldn’t be any. And the increased costs didn’t significantly decrease that demand. I’ll be interested to see what increased rates do to demand and material costs, and how that leads us to value homes that were just built or sold over the last year

 

its a win win for the banks right? they dont care if you foreclose they'll swoop in and take all that shit and sell it to some one who can afford it and they'll probably sell it at pay-off price plus a little just to pay off the loan and pocket a small profit.

 

I work in building material sales for anything from lumber for framing to fireplaces and pavers for the driveway. I am seeing price increases anywhere from7 to 15% almost weekly. And still with lead times out almost 18 weeks on certain supplies. I am very interested on the building that people can still afford to do. And when it comes times for these new houses to be sold that cost 2x more to build than a year ago what the market will do. Or the home owner trying to sell and will have to take the hit cause the house will just not be worth what they paid. Its all speculation moving forward when things will settle the fuck down. But definitely interests me to see what will happen. Will I be able to buy that million dollar house from todays market for 300k and the previous homeowner carry the dept of the difference?

 

Yeah. If it were just one or two factors conspiring to keep house prices climbing I wouldn't be as bullish. But I count no less than 8 rightnow, all pushing in the same direction.

 

I agree. It could either be the increased mortgage rates that put those houses out of comfort zone for buyers next year, or a decrease in material costs that allows them to build their own home for less. Or everything keeps going up for some reason. Or a bunch of idiots become millionaires and throw everything out of balance and @kairo can go fishing while everything burns

 

Rates pre-covid were already low by historical standards. The Covid ZIRP really poured gas on the fire.

Normally these prices would make building new construction extremely profitable, but builders can't get the labor, materials, or zoning to do it fast enough.

Demand will surely cool some as rates rise, but I think what that will mean in practice is a reduction in growth *rate*, not a reversal of growth. I think prices continue to rise, just more like 5-10% a year instead of 25%.

 

I’ll just wait for the moon and ignore all the noise

 

tacoma = investment

duh

 

x2. its a tough gamble. A friend and I were talking about trying to buy a rental property in montana...and of course that place blew up like the rest of the west. But with rising interest rates, seemingly any flattening or cooling of housing prices will be negated by higher mortgage interest rates. By the time people aren't bidding 10% over ask on every house we could be at a 6+% interest rate? ooff

 

@kairo:

https://old.reddit.com/r/Superstonk/comments/tszhia/gamestop_is_planning_on_dpoing_gmee_onto/

 

I am hoping for decreased costs in materials personally just so I can make more money selling a bunch of stuff. But youre right. Its going to be fun to see what happens. Maybe I will go join @kairo fishing and watch the world burn when we moon.

 

Fishing seems relaxing but fish gross me out.

Can I come along but you guys take the fish off the line for me like I'm 5yr old? You can keep the fish since I'm not pescatarian... feels like a fair trade to me