Misleading Information: Lies about the Housing Market
Lies from the Media
Today we break down some of the lies the media has been putting out on the housing market.
Jesse Taff: What's up, everybody? Buying the 208 Jesse Taff, Bryce Gonser and we are going to break down some of the lies or white lies that the news isn't spitting out recently about the housing market and our opinion and as well as our justification as to why a lot of those facts are wrong. So from the housing perspective, there's been a lot of new articles coming out trying to pretty much scare people or just catch people's attention as far as headlines go, that the market is cooling off, or the housing boom is stopped crash coming, whatever the case may be, and some of the specific facts that we've seen recently that we want to kind of discuss our CNBC put an article out that said, new home purchases are down 6.6% this year. One that is true. So that is a fact. Yeah. But the reasoning behind it is not because the markets slowing down at all.
Bryce Gonser: And when you guys are looking at that title of new family homes, it's the word that we need to focus on is new, right? New construction is really what they're talking about. So when you take a look at the actual data behind it, one we can't we know we can't build fast enough. We're on a trajectory where we can't build out of this for another five years. So it's not surprising that new home construction sales are down right now. Do you know what I mean?
Jesse Taff: Yep. So yeah, new construction is down. 6.6% is probably an accurate number but that doesn't mean the market or the purchase of existing homes is down and really, with new construction, everything that we're seeing right now was from 12 to 24 months ago. So development and building new homes are all back at least one to two years. So these numbers are because we had a delay in building enough homes to keep up with the demand.
Bryce Gonser: Very true. Yeah.
Jesse Taff: And then some of the other housing statistics, so the inventory, you know, across the US is up to three to 4%.
Bryce Gonser: And it's important to understand that at the same time have this article came out just a couple of days ago, the National Association of Realtors comes out with their own study their own statistics on it, about existing home sales actually being up 1.4%. So we have one news platform talking about we're down 6.6%, we have another one talking about we're actually up 1.4%, which I believe is again, true because its existing-home sales in the market match new construction. Along with that we actually have a little bit of an increase in inventory. We're up about 3.3% from May, but we're down 18% From this time last year, so you over your inventory is still you know, 18% low and that's not necessarily a good thing or a bad thing. It's just that's what the numbers are, we're not quite back to that healthy real estate supply market and then on top of that, the NBA comes out and talks about mortgage applications, which is a very, another very key factor when you're looking about you know, housing growth and people filing for loans around and we're about we're down 2% since last week, and when this came out, there was a little bit of a disturbance in the media, and everyone was kind of freaking out was like, why are we down 2%. You know, from last week, 18% year over year and what we have to think about guys is that home appreciation has gone up an extremely fast rate, which means there are more cash buyers in the real estate market than there ever has been, right? We went up from 16% last year to 23% of total buyers in the market. 23% this year is cash which means you're not filling out a loan application. So loan applications should be down in really 2% over a week or you know 18% over a year is not that big. Those numbers are they're inflated, they're probably closer maybe 9%, 10%. We have 23% of all buyers actually not even filling out loan applications.
Jesse Taff: Yeah, that's a big chunk and a big increase 7% increase year over year just cash buyers.
Bryce Gonser: Yeah, exactly and so then we also see the inventory across the nation like I just said down about 18 to 20% Another very interesting, just statistic that we like to focus on, especially in this area is the percentage of first-time homebuyers that made up the entire market share in June was actually up 31%. So 31% of buyers in June across the nation that just here in County 31% is first-time homebuyers and they did a very good job of securing a property getting in now they have an appreciating asset, well, they're paying down debt.
Jesse Taff: Exactly, so you know most of all these articles are again trying to catch your attention possibly trying to you know scare or misinformed me that the market is crashing or is cooled off or is no longer busy and clearly that's not the case. I mean I tell all my clients this as well. We have seen it's cool off a little bit but cooling off from absolute absurdity to extremely busy is where we're still at.
Bryce Gonser: Yeah, that's a great point. It's gonna take a while as we said, we physically cannot build-out of this. It would take years and years and years to actually build out so yeah, great point. Yes and coming from just people your madness to it's still extremely busy but it's not a crash by any means.
Jesse Taff: Yep. So we're still seeing mortgage rates at an incredible level to think about purchasing or refinancing.
Bryce Gonser: Eight lower than this time last year. Okay, rates are about eight lower about from this time last year, so still a great opportunity and with refinances dropping off the adverse market fee. Refinances are also still up 9% week over week.
Jesse Taff: Awesome and so prices we do see ticking up still not nearly as fast as they were before but there's no way any area could sustain 40% year over year, more than just one year even that's incredible, and a little bit less competition per home. So if you're buying or if you were on the sidelines now could be a great time to restart and take a look out there and then selling wise it still is a seller's market. So reach out if it's time for you to sell you know, you don't want to miss out on some of these opportunities. It has again cooled off a tiny bit, but we're seeing great offers coming in still multiple offers on most of our listings. So you know the real estate market has not crashed or...
Bryce Gonser: Far from continuing to grow. So guys, a lot of data we just shared there a lot of information out there. Make sure you have a reliable source obviously use Jesse use me for any of these numbers. Make sure you like Subscribe, drop a comment below. We'll talk to you guys soon.