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Right now, with all the demand for housing, property developers are on a MISSION to build homes as quickly as they possibly can…but, there’s a problem: they can’t keep up with demand…because they don’t have enough materials to build from. In the last year, LUMBER PRICES have gone up a whopping 200%.
Some analysis’s are actually calling for this to be the NEXT housing crisis…but, instead of it being caused by a wave of mortgage defaults on nonperforming loans…it’s caused by a lack of lumber, increasing the COST to build a new home by an average of $24,000.
To make matters worse, constraints in supply chains make it nearly impossible to produce the amount of materials needed to keep up with demand – meaning, at least in the short term, housing could remain unusually high – and the increase cost of building winds up being passed on to you, as the customer, in the form of a higher list price.
There is also a new proposal aimed at curbing the housing shortage within the infrastructure package: The plan would look to eliminate zoning and land use policies, which include minimum lot sizes, mandatory parking requirements, and prohibitions of multifamily housing. In its place, the zoning requirements would be restructured in a way that would reflect the current housing shortage, and the NEED to build more real estate in areas which would’ve otherwise have been off limits.
I THINK easing up on zoning CAN be a good thing for cities experiencing a housing shortage, and I do think we need to update the zoning requirement to account for the present day reality that not everyone needs a car parked on site…and that would HELP. BUT, as far as how this is written, unfortunately, it might not be enough.
Since this infrastructure plan would take place over 10 years, that probably won’t give any immediate relief to the housing market. And also – BECAUSE this gives a tax incentive…wealthier cities, who have the biggest housing shortage to begin with, have very little reason to actually go for it, because THEY don’t need the money to begin with.
So, in short…from my perspective, the whole plan has some good intentions, but ultimately…it might not have as much of an impact on the housing market as expected….
AND REALLY…At the end of the day…the housing market doesn’t really appear to show any immediate signs of slowing down. Interest rates are estimated to stay low for another 2 years, it could take 18 months or longer for building materials to come down in price, and until then – there’s still a housing shortage.
Obviously, these conditions can’t last forever – and when there’s such an imbalance between the number of buyers in the market and the number of homes for sale, EVENTUALLY – the tides will change. But, until then, if you’re in the market for a home – be patient, and only purchase a property that you intend on keeping for at least 5-10 years. That way, IF the market goes down – it won’t have an immediate impact on you – because, at this point – anything can happen. Rising interest rates, more inventory, and any change in policy COULD have an effect on housing – but, in the short term, if everything stays relatively the same – housing could very well continue going up.
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great video, great advice. subbed!
I think whoever's buying right now is getting screwed. Royally. My 175k dollar home is worth 300k+ right now. For no reason.
Turd
"What's up Graham it's guys here." Lol!
The US gets ALOT of lumber from Canada. They are still in lockdown. So there you go.
You look like Elon Musk's cousin or something.
Only an idiot would sell stocks or a business or a home during a pandemic. That is you just giving away everything that you own freely.
Really stupid if you are trying to get richer. You are better off buying more to profit more and stay in business.
Really your loss is your loss caused by greedy business owners.
Who cares about the home get the land. Then build a energy efficient home that does not depend on utility companies.
Build your home disaster proof from better cheaper materials.
If things fail go after all the rich and their families.
All they are are criminal business owners.
Sure, California, New York…blue states yes while red states are going up. Best not to say why.
I would have liked the video, but then the "dog shilling" happened
I bought my house from my uncle. He offered it to family before putting it on the market and did a gift of equity as a thank you since we just went straight through a mortgage broker he knew and that saved us on realtor fees. We closed august 2020. I'm pretty sure I'd still be living in my parents' basement without that because of how wild the market is and has been.
Where's all the vacant office buildings being made into slick public housing or apartments ??…I thought so.
This guy is super rich..
I almost completely lost you, what are you talking about
My dog will eat your dog
Wow this video answered all my questions about why they keep building luxury apartments and stuff in NC
I saw one in California that sold for $505,000 OVER asking price. Not kidding.
Getting 2008 flashbacks. Of course the current conditions are not the same as 2008 but the results will be the same in the end.
We sold our 1940’s lightly updated 2br home in Seattle last March for 20% over asking (nearly $1000/sf). We have yet to land our next home but so far everything has gone 20-30% over asking. One house received 34 offers and almost everyone is waiving contingencies!!
Working from outer-space, here.
Sell and rent something new, preferably with a swimming pool, ha
Millennials are getting screwed by two presidents= Obiden
Unfortunately everything that he saying about the parking requirements from the city being negative is from somebody that lives on the “nice” side of town but for everyone that lives on the “humble” side of town parking is a huge huge issue. Its terrible. It’s actually impressive that the city is taking that into account and holding developers and investors accountable for the aftermath of what comes when more people live in confined areas. First hand knowledge from a resident, investor and developer in LA country.
This is shaping up to be a perfect storm of several issues many of you have stated. This country is going through a tough "$hit show" period right now. God speed to all.
Lol
Buy expi
Business, never like a buyer. Double your price.
Yeah lumber is 5x more than 18months ago where i live.
“You can waive the inspection contingency which almost no other buyer will do”
Except now properties are selling so quick that you can’t inspect it ahead of time and everyone is waiving inspections.
Yeaaaa California!! We are setting up Californian colonies in every state to export our great way of life. Like we did in New California… I mean Texas.
Thank Capitalism.
And who can we thank for the shitty housing market? None other than Uncle Joe Biden. What an oaf. God almighty.
Graham Stephan, if you are a buyer over 60 years old, will you be discriminated for your age on buying a house in today's market? Will the dealer or such see your age and determine that theoretically, you won't live long enough to pay everything off or does that matter? I know someone who now has to put a 30% downpayment if they want a homes and want to know if that is common.
It is all bullshit. There are plenty of buildings available for sale or rent in NYC. You can go to plenty of places in Jersey up for sale. The rush is on, but it is area specific. It is mass migrations out of bad areas. How can there be a rental/housing shortage with the increased deaths related to COVID?
yuhuuuuu let's celebrate money becoming worthless!
You kidding me? I'm about to make over $100,000 on my house and pay off my mortgage. $eller's market. Once you find a house you buy a house, not complicated.
Ok, so say I have a Small 600sqft cabin I no longer use in TX. I don't need the money but worry about ongoing maintenance over time. Should I keep it?
As for me the only problem is that I already live too close to my neighbors as it is. Changing zoning requirements to add another 4-6 families nearly on top of me – ah..no thanks.
We love the house for about 130,000 it went for 250,000. 🤦♀️ The average house cost around the neighborhood is 100,000.
Easing up on zoning is a baaad idea!!! It's a pandoras box which will allow capitalistic greed to take over and you can not rely on people's good conscience to keep things working. I am speaking from experience. Having lived all my life in one the poshest localities in the capital of my country, Ive seen it go from a beautiful, planned township to absolute mess and chaos! There is never space to park, the place looks hideous and definitely not worth even a fraction of the millions of dollars purchase price if you were to consider the quality of life which has declined significantly over the years(after you normalize for improvement in the standard of living due to economic progress of the country as a whole and technological progress, etc.).
How did you learn so much about economics without attending school?
I was an economics major but I am now considering stopping school to work in real estate for a few years…
Also the worst tax of all…Inflation.
Here in Denver Colorado metro area home prices are average half a million dollars. And thats just the asking price. All these Californians and out of state cash buyers bidding up the price of homes $100k or more over asking price. And homes are in the market just 1-3 days. Makes it impossible for first time home buyers to buy a home. I see some hope in El Paso Texas where homes are very super affordable. Hopefully move there soon.
Same thing going on in Canada, a bungalow in renovated will cost you 1million CAD in Ontario. Lol. Guess I’m moving into the trailer park
Who else heard the KSP music??
Bro… How is that dog talking…
Moral of the story? Government screws everything up.
[13:50] Leasebacks are also good for the seller since, as they are moving out, they are likely looking for a new home wherever they are headed, and the leaseback means that during the leaseback and after closing, they have cash-in-hand when they themselves are house-hunting ahead of their move.
Did he say "What's up Graham…it's guys here?"…let me go back…yup, yup he did. Regardless, another this is another great video.