WEBVTT - Is It a Terrible Time to Buy a Home? #551 0:00:00.080 --> 0:00:03.160 Welcome to How the Money. I'm Joel and I am Matt. 0:00:03.360 --> 0:00:05.840 Today we're asking the question, is it a terrible time 0:00:06.040 --> 0:00:27.680 to buy a home? Yeah, dude, there are a lot 0:00:27.880 --> 0:00:31.240 of different things going on within the housing market, Like 0:00:31.320 --> 0:00:33.279 what what a time to be alive? First of all, 0:00:33.479 --> 0:00:35.760 because I don't know we all like being alive. If 0:00:35.920 --> 0:00:38.880 I'm thinking specifically of the past two years, man, the 0:00:39.040 --> 0:00:41.040 past two and a half years that we have experienced, 0:00:41.280 --> 0:00:43.360 what a time to have a personal finance podcast and 0:00:43.400 --> 0:00:46.120 be able to just learn about this stuff up close? 0:00:46.560 --> 0:00:49.280 And uh not only with the stimmy checks way back. 0:00:49.680 --> 0:00:52.320 Uh so that's when we started our Friday flights, right, Like, 0:00:52.400 --> 0:00:54.960 what's back when the stimulus checks were hitting and folks 0:00:55.000 --> 0:00:57.080 were wanting to figure out what am I gonna get mine? 0:00:57.160 --> 0:00:58.800 What's that going to show up? That was the big question, 0:00:58.920 --> 0:01:00.440 right Like we were all kind of way, I mean, like, 0:01:00.480 --> 0:01:02.560 it is money going to really just show up into 0:01:02.600 --> 0:01:04.959 my account? That kind of thing. But the housing market, 0:01:04.959 --> 0:01:07.280 that's been another thing that we have seen just on 0:01:07.319 --> 0:01:09.920 a tear recently, and things are changing. I don't want 0:01:09.920 --> 0:01:12.399 to be self aggrandizing and make it sound like personal 0:01:12.400 --> 0:01:14.679 finance podcasts are more important than normal but they're the 0:01:14.720 --> 0:01:17.880 best out there. But I do think these pasts there's 0:01:17.920 --> 0:01:20.160 so important a couple of years listening to a personal 0:01:20.200 --> 0:01:22.679 finance podcast because the facts on the ground are changing 0:01:22.720 --> 0:01:25.039 so rapidly in so many areas of our lives. When 0:01:25.080 --> 0:01:26.960 it comes to inflation, when it came to simmy checks, 0:01:26.959 --> 0:01:28.839 when it comes to it, and never changing housing market. 0:01:29.040 --> 0:01:31.280 It's like it's more important to get kind of some 0:01:31.400 --> 0:01:34.199 up to date information and advice. That's what we're here for. Certain, 0:01:34.200 --> 0:01:35.840 that's the point of the show. It's certainly pertinent. And 0:01:35.880 --> 0:01:38.960 I guarantee that listeners out there who have found our 0:01:38.959 --> 0:01:40.520 show in the past couple of years, I guess I 0:01:40.520 --> 0:01:42.640 can't guarantee you, but but I'm pretty sure they're in 0:01:42.640 --> 0:01:45.240 a better place now then they would have been. Yeah, 0:01:45.319 --> 0:01:47.200 that's what I love about what we do here at 0:01:47.240 --> 0:01:49.120 How the Money. But yeah, we're talking about the housing 0:01:49.120 --> 0:01:51.920 market during this episode, specifically if right now is a 0:01:52.000 --> 0:01:53.720 terrible time to buy, and we're going to answer that. 0:01:54.080 --> 0:01:56.400 Plus we're gonna be able to to guide people through 0:01:56.480 --> 0:01:59.200 a way of thinking about a home purchase so that 0:01:59.240 --> 0:02:02.040 they make the right decision for themselves. But first, man, 0:02:02.200 --> 0:02:05.000 I've got a frugaler cheap for you. You may have 0:02:05.040 --> 0:02:07.960 noticed during my lunch breaks, I like to get outside. 0:02:08.120 --> 0:02:10.520 I enjoy eating my lunch out side, seeing the trees 0:02:10.600 --> 0:02:12.639 here in the birds chirp, and then I I oft. 0:02:12.639 --> 0:02:14.680 Sometimes I try to go for a walk around the block. 0:02:15.240 --> 0:02:17.320 And over the past few weeks when i've come back, 0:02:17.360 --> 0:02:20.200 I've come back with figs. I've offered you a figure too. 0:02:20.560 --> 0:02:24.240 You're not a fan. My daughter lovesick, she would pick out. 0:02:24.360 --> 0:02:26.120 Next time I will go, I'll bring a couple back 0:02:26.160 --> 0:02:28.480 for her and you can take this home. But I 0:02:28.520 --> 0:02:31.320 am pulling these figs off of a neighbor's tree. So 0:02:31.360 --> 0:02:35.920 this is I guess neighbor of the family we rent 0:02:35.919 --> 0:02:38.400 our carriage house from. And this fig tree, it's massive, 0:02:38.480 --> 0:02:40.760 it kind of hangs out over the sidewalk. And there 0:02:40.760 --> 0:02:43.919 have been these gorgeous giant figs just right for the picking, 0:02:44.000 --> 0:02:46.080 and so I have been picking them. So my question 0:02:46.160 --> 0:02:49.280 to you, am I being frugal or cheap by stealing 0:02:49.280 --> 0:02:52.080 this person's fruit. That's a really good question. That's a 0:02:52.080 --> 0:02:54.160 really good question. And maybe I'm wrong here. I think 0:02:54.200 --> 0:02:56.000 most of them the fruit goes on eaten or it 0:02:56.000 --> 0:02:59.040 gets eaten by animals. Right, So I think so. My 0:02:59.080 --> 0:03:00.720 guess is that if it's some sort of giant fig 0:03:00.720 --> 0:03:04.400 tree that's producing, they produce a ton figs if they're big, 0:03:05.120 --> 0:03:07.560 that a lot of them are going Uneaton, or maybe 0:03:07.600 --> 0:03:09.640 even all of them are going Uneaton. So I think 0:03:09.680 --> 0:03:12.040 if it's like hanging over the street, I don't think 0:03:12.040 --> 0:03:14.120 it's a big deal to pluck a few. But you know, 0:03:14.160 --> 0:03:18.320 if you want to knock on the door and say, hey, 0:03:18.440 --> 0:03:20.359 I'm your neighbor, Matt and so, like the other day, 0:03:20.520 --> 0:03:22.840 we're starting to walk to school and the quickest way 0:03:22.840 --> 0:03:24.320 for us to get to the to our kids school 0:03:24.639 --> 0:03:26.960 is to walk through our backyard and through someone else's backyard. 0:03:27.240 --> 0:03:28.880 And I was like, this is just gonna save us 0:03:28.919 --> 0:03:32.040 so much time. But kind of walking down somebody's driveway 0:03:32.120 --> 0:03:34.280 on the back end to make sure you're above boys. Yeah, 0:03:34.320 --> 0:03:35.520 so I go knock on the door and they're like, 0:03:35.520 --> 0:03:36.760 who is this weird guy? And I'm like, I'm a 0:03:36.800 --> 0:03:38.640 new neighbor. Can we walk into the driveway And they're 0:03:38.680 --> 0:03:41.119 like of course, And they were cool about it, but yeah, 0:03:42.440 --> 0:03:44.520 we're I to knock on the door. They I'm guessing 0:03:44.520 --> 0:03:46.960 they would probably be like of course, yeah. But there's 0:03:47.000 --> 0:03:49.360 also just like you said, who's this weird guy? There's 0:03:49.360 --> 0:03:51.640 an element of man. You don't need to ask, just 0:03:51.680 --> 0:03:54.720 take them, like obviously I'm not eating them. Uh, if 0:03:54.760 --> 0:03:56.560 there was somebody out there, if there's like an old 0:03:56.600 --> 0:03:59.560 lady and she's out there, you know, knocking the figs 0:03:59.560 --> 0:04:01.400 into her, ask it and it looks like she's gonna 0:04:01.440 --> 0:04:03.880 make a pie or I don't know. That's why I 0:04:03.960 --> 0:04:06.440 picture making thig pies, which I don't even know if 0:04:06.440 --> 0:04:08.760 that's a five could be a young man making fig pies, Matt, 0:04:08.880 --> 0:04:10.960 I will that is true, But I will say a 0:04:11.000 --> 0:04:13.880 few weeks ago, when they first started turning ripe, I 0:04:13.920 --> 0:04:16.719 was kind of eyeing them and I wasn't taking more 0:04:16.760 --> 0:04:20.200 than one fig initially, right, because they slowly begin to ripen. 0:04:20.600 --> 0:04:22.480 But like a week or two into it, I mean, 0:04:22.480 --> 0:04:27.000 I'm looking at dozens of ripe figs and I thought, no, literally, 0:04:27.000 --> 0:04:29.480 nobody is picking these at this point, and I gave 0:04:29.480 --> 0:04:33.479 myself permission to then start gathering more than one. I'll grab, 0:04:33.520 --> 0:04:35.440 I'll grab two or three, and it's my it's my 0:04:35.440 --> 0:04:37.479 fruit serving fortunch. I think you're a bo bored on this. 0:04:37.480 --> 0:04:39.680 I think it's okay. I'm not gonna judge you keep 0:04:39.680 --> 0:04:41.640 picking your figs. They're delicious. But I found out about 0:04:41.640 --> 0:04:43.920 it when and neighbor told me about a pear tree 0:04:43.960 --> 0:04:46.599 that's kind of on some sort of public property or 0:04:46.640 --> 0:04:48.920 something that bears a lot of fruit. And so we're 0:04:48.960 --> 0:04:51.120 gonna run in the snacks and pairs when one of those, 0:04:51.520 --> 0:04:54.960 one of those they're coming into season now nice, I think, 0:04:55.240 --> 0:04:56.600 because he had a pear tree in his frint yard 0:04:56.600 --> 0:04:58.240 and he told us he was and he was like, 0:04:58.240 --> 0:04:59.480 by on the way, there's one around the corner you 0:04:59.520 --> 0:05:01.680 should grab. I'm from So so do you know, okay, 0:05:01.720 --> 0:05:03.960 while we're talking about forging for wild fruit, do you 0:05:04.000 --> 0:05:06.919 know the trick with pear trees? You will pull that 0:05:06.960 --> 0:05:08.600 pair and you will take it home and you're like, oh, 0:05:08.640 --> 0:05:10.599 I'm excited to eat this and you go to bite 0:05:10.640 --> 0:05:12.680 into it and you're like, oh man, this is not 0:05:12.720 --> 0:05:16.000 a good on the window. You wait one week. Evidently 0:05:16.040 --> 0:05:18.400 we learned this from our buddies Tim and he's got 0:05:18.400 --> 0:05:21.240 a pear tree in his yard and this thing evidently drops. 0:05:21.640 --> 0:05:23.560 I mean, he made it sound like hundreds of pears. 0:05:23.800 --> 0:05:26.239 But what you do you you pull them, you gather them. 0:05:26.360 --> 0:05:28.880 You let him sit around for one week, and after 0:05:28.920 --> 0:05:30.800 a week they taste like the pairs you buy at 0:05:30.800 --> 0:05:33.000 the store and you don't eat them right away. So 0:05:33.040 --> 0:05:35.360 if if you've got one of those pear trees, uh, 0:05:35.520 --> 0:05:37.400 just give it a second. If it's a fig, if 0:05:37.440 --> 0:05:39.160 you happen to be walking around you see your right fig, 0:05:39.160 --> 0:05:40.760 go ahead and grab it and eat it right away. 0:05:40.880 --> 0:05:43.000 Yeah no, no, you throw caution in the wind. If 0:05:43.040 --> 0:05:45.280 someone's looking at you, weird, Just to eat that fig anyway, right, 0:05:45.440 --> 0:05:47.200 get ready to take off, run and supposed to wash 0:05:47.279 --> 0:05:49.720 him first though, right, Well, yeah, I bring him home 0:05:49.720 --> 0:05:51.279 and I'm watching him here in this thing. The first time. 0:05:51.320 --> 0:05:53.200 I was like, I want to see how good these 0:05:53.279 --> 0:05:55.560 jokers are, and I ate one during my walk I think, 0:05:55.600 --> 0:05:58.560 here me fine. Yeah, all right, well let's let's mention 0:05:58.640 --> 0:06:00.800 the beer we're having on this episode, Matt. This one's 0:06:00.800 --> 0:06:04.240 called Odette and it's by Fair Aisle Brewing. It is 0:06:04.520 --> 0:06:08.279 like an oak aged beer that food or smells fantastic. 0:06:08.320 --> 0:06:10.080 So we give our thoughts that the real end of 0:06:10.120 --> 0:06:12.200 the episode looking forward to this one. But let's move on, Matt. 0:06:12.240 --> 0:06:13.719 Let's get to the question of hand. We're asking, is 0:06:13.720 --> 0:06:16.760 it a terrible time to buy a house. And it's 0:06:16.760 --> 0:06:20.200 been said that timing is everything, right, I mean in 0:06:20.040 --> 0:06:24.080 in almost everything in life. Your timing matters a great deal. Sometimes, 0:06:24.120 --> 0:06:25.880 like I don't know, I'm thinking about people who graduated 0:06:25.920 --> 0:06:28.479 during the Great Recession, and it's like, well, in my 0:06:28.560 --> 0:06:30.800 degree doesn't feel as useful right now as it might 0:06:30.839 --> 0:06:32.360 have just a few years ago. I was thinking about 0:06:32.360 --> 0:06:33.960 the first time that you asked Emily out on a day. 0:06:34.320 --> 0:06:38.040 That's true, we were ready. She's like, who you you ugly? 0:06:38.279 --> 0:06:40.520 I don't think so, but you know, over time she 0:06:40.600 --> 0:06:42.120 got to know me and she was like, he's beautiful 0:06:42.120 --> 0:06:43.719 on the inside. But a year later, it's like the 0:06:43.720 --> 0:06:46.800 personality is what kept exactly she kind of came around. Well, 0:06:47.400 --> 0:06:49.080 something else that made me think of was like NASCAR 0:06:49.200 --> 0:06:51.640 or Formula One drivers they need like perfect timing in 0:06:51.760 --> 0:06:54.240 order to make a move to pass their competition. A 0:06:54.240 --> 0:06:56.880 split second right and ill timed attempt it can it 0:06:56.920 --> 0:06:59.440 can result in falling further behind in the race, or 0:06:59.720 --> 0:07:01.680 we're maybe some sort of like awful crash that takes 0:07:01.680 --> 0:07:04.360 you out of the race completely. Well, the housing market 0:07:04.440 --> 0:07:05.880 has has kind of been shaking up in a big 0:07:05.920 --> 0:07:09.559 way as prices have risen substantially and now higher rates 0:07:09.760 --> 0:07:12.440 are making things even more unaffordable. All the rates have 0:07:12.480 --> 0:07:14.440 actually come back down to earth just a little bit 0:07:14.480 --> 0:07:17.520 in recent weeks, but the market feels like it's it's 0:07:17.560 --> 0:07:21.560 kind of stalled out, heading for a correction. And although Matt, 0:07:21.600 --> 0:07:22.840 the two of us, you know, you and I would 0:07:22.840 --> 0:07:25.560 be pretty shocked if the current market oddities ended up 0:07:25.600 --> 0:07:28.440 in anything resembling the crash of two thousand and eight, like, 0:07:28.480 --> 0:07:31.240 we don't think it's likely to happen, but the fundamentals 0:07:31.280 --> 0:07:33.160 are just so different this time around. But there's still 0:07:33.200 --> 0:07:35.280 a lot of uncertainty when it comes to the housing 0:07:35.280 --> 0:07:38.080 market right now. And so if if you were making 0:07:38.120 --> 0:07:40.880 offers last year, you kept missing out, consistently, kept getting 0:07:40.920 --> 0:07:43.920 out bit because there were thirty nine offers every time 0:07:43.920 --> 0:07:45.720 you try to buy a house and people paying a 0:07:45.760 --> 0:07:48.360 hunter more than list price. That's not happening right now. 0:07:48.760 --> 0:07:50.600 So is now the time for you to finally build 0:07:50.600 --> 0:07:52.480 to buy that house. That's kind of what we want 0:07:52.480 --> 0:07:55.640 to discuss in today's episode. That is right, man. Yet, 0:07:55.680 --> 0:07:57.680 you know it's interesting too that we're talking about timing 0:07:57.920 --> 0:08:00.080 uh in the housing market today because timing the mark 0:08:00.160 --> 0:08:03.640 it isn't something that you necessarily hear us talk about 0:08:03.680 --> 0:08:06.120 it's not something we're in favor of, at least when 0:08:06.160 --> 0:08:08.880 we're talking about the stock market, right Like, we would 0:08:08.880 --> 0:08:11.800 prefer to see folks dollar cost average every two weeks 0:08:11.880 --> 0:08:14.640 for decades and then just leave the results to the 0:08:14.720 --> 0:08:17.360 overwhelming odds that cares if it's a ten year bowl 0:08:17.440 --> 0:08:19.480 run or currently in a bear market, it doesn't matter, 0:08:19.520 --> 0:08:21.280 just keeping keep going. Exactly, you don't have to worry 0:08:21.280 --> 0:08:23.119 about timing because you're likely going to be just fine. 0:08:23.720 --> 0:08:26.480 But you know, you don't dollar cost average into a house, 0:08:26.840 --> 0:08:30.040 and so timing matters a good bit more when you're 0:08:30.200 --> 0:08:33.280 plunking down tens of thousands of dollars for just the 0:08:33.360 --> 0:08:36.240 down payment on a house, on the most expensive purchase 0:08:36.280 --> 0:08:39.000 that you're ever going to make. And so for that reason, 0:08:39.559 --> 0:08:42.600 I think timing does come into play, uh slightly more 0:08:42.679 --> 0:08:45.200 than it does when you're talking about investing in the 0:08:45.200 --> 0:08:48.679 stock market. And so this episode is intended to help 0:08:48.720 --> 0:08:51.760 you to find some some firm footing as you're considering 0:08:51.880 --> 0:08:54.040 your next move when it comes to housing. So we'll 0:08:54.160 --> 0:08:56.920 we'll talk about renting versus buying in general, but we'll 0:08:57.120 --> 0:09:00.480 also discuss you know, which factors you should be most 0:09:00.559 --> 0:09:03.800 keenly paying attention to UH in a market that is 0:09:03.960 --> 0:09:06.000 shifting in a in a big way right now. Yeah, 0:09:06.120 --> 0:09:09.840 market conditions for housing, they're changing and tappening fast right then. 0:09:10.120 --> 0:09:12.839 Like I said, uh, mortgage rates have been all across 0:09:12.840 --> 0:09:15.320 the board going shooting above six percent now back down 0:09:15.360 --> 0:09:17.679 to the five percent range. And so these ships are 0:09:17.679 --> 0:09:20.560 happening quickly. Home purchase agreements, when you look at the stats, 0:09:20.559 --> 0:09:22.679 they've been blowing up left and right there. So a 0:09:22.760 --> 0:09:25.240 huge majority of contracts that are being entered into are 0:09:25.240 --> 0:09:27.960 now the buyers are not backing out, more so, way 0:09:27.960 --> 0:09:30.360 more so than we saw last summer in spring. Uh. 0:09:30.400 --> 0:09:32.000 And like I said, those those houses, Matt, that we're 0:09:32.040 --> 0:09:34.880 getting multiple offers, right. I mean when you sold your house, 0:09:35.200 --> 0:09:37.000 you had a ton of offers, there were a lot 0:09:37.000 --> 0:09:39.120 of people, there's a lot of interest. I did, yes, 0:09:39.200 --> 0:09:41.040 and so that was that was a good thing. Now 0:09:41.080 --> 0:09:43.160 if you were to list that same house, UH, you 0:09:43.200 --> 0:09:45.240 might get crickets at least for a few days or 0:09:45.240 --> 0:09:47.440 a week or something like that. It's not nearly not 0:09:47.520 --> 0:09:51.520 nearly as frothy. But yeah, now these homes are sitting longer. 0:09:51.520 --> 0:09:54.800 Price cuts are happening with more regularity, and basically things 0:09:54.800 --> 0:09:57.360 are just mellowing out, and we would say that's actually 0:09:57.400 --> 0:10:00.520 a good thing, right. Uh. It also creates more certainty 0:10:00.520 --> 0:10:03.240 though for buyers and for sellers, And so now you 0:10:03.280 --> 0:10:06.160 might start to wonder, however priced is this home that 0:10:06.200 --> 0:10:08.600 I'm interested in? Or should I wait until rates go 0:10:08.679 --> 0:10:10.920 down even more? Or you might be asking if I 0:10:10.920 --> 0:10:12.800 wait just a bit longer, am I going to get 0:10:13.000 --> 0:10:16.960 a more significant discount? And we can't answer these questions 0:10:16.960 --> 0:10:20.400 with perfect accuracy. So much depends on a whole slew 0:10:20.440 --> 0:10:24.280 of factors, especially given like the wild cards of FED policy. 0:10:24.760 --> 0:10:26.840 What is going to continue to happen with mortgage rates? 0:10:26.920 --> 0:10:29.600 And then this specific location where you live, So much 0:10:29.600 --> 0:10:31.440 of the reality on the ground is going to be 0:10:31.520 --> 0:10:33.520 determined by things that are out of our control. But 0:10:33.800 --> 0:10:35.040 we'll do our best to kind of give you an 0:10:35.080 --> 0:10:37.679 overview of what's happening alongside with our thoughts on on 0:10:37.720 --> 0:10:40.319 how you should proceed. Uh. If buying house is something 0:10:40.360 --> 0:10:42.200 that you're still keen on doing, that's right. Yeah, And 0:10:42.200 --> 0:10:44.160 I'm not going to give away the punchline, but I 0:10:44.360 --> 0:10:46.280 feel like a part, like a t l d R 0:10:46.360 --> 0:10:49.040 of this episode is that, like the question the true 0:10:49.080 --> 0:10:52.199 question though, right asking is do these things even matter? 0:10:52.600 --> 0:10:55.160 Because we're gonna talk about a host of personal factors 0:10:55.160 --> 0:10:57.240 that we need to be considering. But you know, even 0:10:57.240 --> 0:11:00.679 though we are seeing price cuts to homes, housing prices 0:11:00.720 --> 0:11:02.040 are still through the roof when you when you back 0:11:02.080 --> 0:11:03.800 out and look at it, you know, they've increased something 0:11:04.080 --> 0:11:08.280 close to year over year on average. Uh, most counties 0:11:08.320 --> 0:11:10.000 in Florida, they've been going up at a rate like 0:11:10.000 --> 0:11:12.680 in the thirties and in the forties, and the median 0:11:12.800 --> 0:11:17.640 monthly payment has gone up. Although that year over year increase, 0:11:17.840 --> 0:11:20.800 it's actually finally starting to slow down, uh, due to 0:11:21.280 --> 0:11:25.880 a combination of rapidly increasing prices and mortgage rates doubling 0:11:26.400 --> 0:11:29.360 overnight virtually. Like, that's what what has created this new reality. 0:11:29.559 --> 0:11:31.440 But when home prices go up that much in such 0:11:31.480 --> 0:11:34.600 a small period of time, it's bound to cause some 0:11:34.679 --> 0:11:37.199 turbulence in the market. Um. You know, first we saw 0:11:37.320 --> 0:11:40.760 bidding wars, and now we're seeing folks who are apathetic 0:11:40.760 --> 0:11:42.640 to the market. A lot of folks have thrown in 0:11:42.679 --> 0:11:45.520 the towel, they've deleted Zelo from their phones altogether because 0:11:45.559 --> 0:11:48.080 they have decided that, you know what, it's not time 0:11:48.480 --> 0:11:50.520 for us to buy a house. Things aren't working out. 0:11:50.800 --> 0:11:53.959 But what we're saying is to think again, Uh look, 0:11:54.040 --> 0:11:57.320 look twice, because now actually might be the perfect time 0:11:57.600 --> 0:12:00.600 depending on a number of factors. For We'll get into 0:12:00.600 --> 0:12:02.000 all those factors, and man, it makes me think of 0:12:02.280 --> 0:12:05.120 maybe being like in Atlanta Falcons fan, and how five 0:12:05.160 --> 0:12:07.520 games into the season you're like, I don't really need 0:12:07.559 --> 0:12:09.199 to follow the team anymore because they're basically had a 0:12:09.200 --> 0:12:11.600 playoff contention already, and so you might not realize whether 0:12:11.600 --> 0:12:13.320 they've gone on like a three win streak or something 0:12:13.360 --> 0:12:16.120 like that because you stopped watching because they were so 0:12:16.160 --> 0:12:17.880 bad in the beginning of the season. And that's what 0:12:17.880 --> 0:12:19.240 happened with a lot of folks when it came to 0:12:19.760 --> 0:12:21.679 canceled cable. I'm not going to follow them anywhere, right, 0:12:22.040 --> 0:12:23.880 dang it? Well no, I'm listening on another all the 0:12:23.920 --> 0:12:27.120 winds and follow on Twitter. But that's just the kind 0:12:27.120 --> 0:12:28.360 of the reality for a lot of people is as 0:12:28.400 --> 0:12:29.840 they got priced out of the market, they just kind 0:12:29.840 --> 0:12:32.360 of tuned it out all together. And like you just mentioned, 0:12:32.440 --> 0:12:35.000 interest rates, you know, have which were on the rise 0:12:35.120 --> 0:12:37.280 for for quite a while, impacted the cost of housing 0:12:37.320 --> 0:12:40.000 in a significant way. Uh, you know, most folks who 0:12:40.080 --> 0:12:41.880 buy a home, they out a mortgage on that home, 0:12:42.080 --> 0:12:44.000 and so it's not just the skyrocketing price the house, 0:12:44.000 --> 0:12:47.760 but it's also the increased costs of financing. And so, yeah, 0:12:47.800 --> 0:12:49.640 when when the Fed Fund rate goes up by three 0:12:49.720 --> 0:12:51.360 quarters of a point, here's the thing. A lot of 0:12:51.360 --> 0:12:53.960 people assume that mortgage rates are gonna skyrocket, but that's 0:12:54.000 --> 0:12:56.040 not exactly how it works. They don't move in tandem 0:12:56.240 --> 0:12:59.000 when the Fed moves their rate up, and so the 0:12:59.040 --> 0:13:02.679 reality is the those rising interest rates impact the economy, 0:13:03.000 --> 0:13:05.960 and that is what's impacting what happens with mortgage interest rates. 0:13:06.200 --> 0:13:09.600 So rates have actually gone down in recent weeks, and 0:13:09.600 --> 0:13:11.360 and that means that you can afford just a bit 0:13:11.400 --> 0:13:13.679 more house for the same amount of money. Not as much, 0:13:13.679 --> 0:13:16.520 of course, as when rates were below three percent, obviously, 0:13:16.760 --> 0:13:18.559 but I feel like we're starting to see a housing 0:13:18.600 --> 0:13:21.160 market that's got a little more balance to it, uh, 0:13:21.320 --> 0:13:24.120 less frothy, less apathetic, maybe a bit more of a 0:13:24.120 --> 0:13:26.400 healthy market in general, that's true. Yeah, it seems like 0:13:26.400 --> 0:13:29.600 things are resuming some sort of normalcy. But buyers are 0:13:29.640 --> 0:13:32.920 not the only ones who've been shocked by rapidly increasing 0:13:32.960 --> 0:13:36.040 housing costs, will actually talk about what's happening to renters 0:13:36.320 --> 0:13:38.600 and also discuss the most important factors you need to 0:13:38.600 --> 0:13:41.480 consider before purchasing a home. Will get to all of 0:13:41.480 --> 0:13:52.880 that right after the break. Alright, best, but let's keep 0:13:52.880 --> 0:13:55.720 talking about real estate, because do it. It's it's still 0:13:55.840 --> 0:13:58.640 a hot topic of conversation, even if you're on Zillo 0:13:58.920 --> 0:14:01.839 for thirty and at the left every day because you 0:14:01.920 --> 0:14:04.320 got priced out of the market. Well, here's the thing. 0:14:04.960 --> 0:14:07.599 It's not just that buyers have gotten priced out of 0:14:07.600 --> 0:14:10.960 the market. Renters have also seen a huge uptick in 0:14:11.000 --> 0:14:13.520 prices too. There's just been no reprieve for anybody when 0:14:13.520 --> 0:14:16.320 it comes to housing costs, and rents have kind of 0:14:16.320 --> 0:14:19.320 actually lagged the housing market in most places. So here's 0:14:19.320 --> 0:14:21.760 the thing. Even if you have opted to forego a 0:14:21.840 --> 0:14:25.000 home purchase because it was getting it was getting too pricey, 0:14:25.080 --> 0:14:28.040 that doesn't necessarily mean that you've avoided the rising cost 0:14:28.080 --> 0:14:30.320 of housing, right You're still kind of impacted by it 0:14:30.600 --> 0:14:32.720 in a in a different way. So instead of watching 0:14:32.720 --> 0:14:35.840 prices rise as you're looking through the apps, you probably 0:14:35.840 --> 0:14:38.680 just got a rough email from your landlord before your 0:14:38.720 --> 0:14:41.760 least expired telling you that your your rate is going 0:14:41.840 --> 0:14:46.240 up something like eight and the difference is largely determined 0:14:46.400 --> 0:14:48.400 based on where you live. Right. So, for example, the 0:14:48.400 --> 0:14:51.480 Wall Street Journal had a great article about a bunch 0:14:51.480 --> 0:14:54.040 of different markets and where rents and home prices have gone. 0:14:54.400 --> 0:14:57.840 Uh So, in Atlanta, for instance, rents rose about twelve 0:14:57.840 --> 0:15:00.560 percent last year, while home prices went up by twenty 0:15:00.560 --> 0:15:02.760 two percent. And that was kind of like similar in 0:15:02.920 --> 0:15:05.880 markets like Charlotte, Vegas, Austin, and Phoenix, and there were 0:15:05.920 --> 0:15:08.760 other There were other cities I think, like Miami, where 0:15:08.840 --> 0:15:11.360 rents went up quite a bit more than housing prices. 0:15:11.440 --> 0:15:13.600 But you know, while those rising rent prices have been 0:15:13.640 --> 0:15:15.720 tough for a lot of folks to stomach, home buyers 0:15:15.720 --> 0:15:17.600 in lots of the country have seen the price tag 0:15:17.640 --> 0:15:20.800 increase even more. So basically, I don't know, it's just 0:15:20.840 --> 0:15:23.560 bad news all the way around for anybody cannot escape. Yeah, 0:15:23.560 --> 0:15:26.200 who's trying to live anywhere? Right, that's right? Besides like 0:15:26.280 --> 0:15:29.640 a tent in your friend's backyard. Uh and maybe they're 0:15:29.640 --> 0:15:32.040 asking you to chip in a little bit water for 0:15:32.080 --> 0:15:34.200 all those outdoor showers. I don't know. And so the 0:15:34.280 --> 0:15:37.760 question right like, will can rents continue to rise? Well, 0:15:37.920 --> 0:15:40.760 that's a complicated question, and there are too many factors 0:15:40.760 --> 0:15:43.720 to weigh in in order to nail down an answer. 0:15:43.920 --> 0:15:46.320 Because the fires continue to sit on the sidelines opting 0:15:46.360 --> 0:15:48.080 to not buy a home, it's going to mean more 0:15:48.160 --> 0:15:52.000 demand for rental units, raising prices. And that demand, like 0:15:52.000 --> 0:15:54.320 it's already pretty intense, you know. Plus rental units just 0:15:54.400 --> 0:15:57.160 aren't being built fast enough. But as the housing markets 0:15:57.160 --> 0:16:00.200 continue this offten and more people are less in their 0:16:00.200 --> 0:16:03.760 homes for sale, now we could see prices decrease enough 0:16:03.800 --> 0:16:06.360 that buyers start to get interested again. So much of 0:16:06.480 --> 0:16:08.720 this hinges on things outside of our control. You know, 0:16:08.760 --> 0:16:11.160 we certainly don't have a crystal ball. We can't prognosticate, 0:16:11.360 --> 0:16:13.320 you know, what's going to happen with rents tomorrow or 0:16:13.400 --> 0:16:17.160 home prices tomorrow, um, especially as we look out even further. 0:16:17.200 --> 0:16:19.600 I mean, it's harder, it's harder to know, especially like 0:16:19.640 --> 0:16:22.080 the wild cards that I mentioned, Matt, those are those exist. 0:16:22.240 --> 0:16:24.960 So what we had talked about a year ago was, hey, 0:16:25.000 --> 0:16:27.520 the housing market, because of the shortage of homes, is 0:16:27.560 --> 0:16:30.720 likely to continues to see price increases into the future. 0:16:30.760 --> 0:16:33.040 But what we weren't factoring in with some of these 0:16:33.080 --> 0:16:35.480 outside influences that we're gonna that we're gonna come in 0:16:35.680 --> 0:16:38.440 and change the dynamics of the situation. But let's talk 0:16:38.440 --> 0:16:40.560 about the kind of the rent verst By conundrum right now, 0:16:40.600 --> 0:16:43.360 because both buyers and renters are in a tough situation, 0:16:43.920 --> 0:16:47.200 we'd recommend that you don't overly focus on the market 0:16:47.240 --> 0:16:50.520 and the numbers. Basically, if you're wondering if now is 0:16:50.520 --> 0:16:52.360 the right time to buy a place, it's it's just 0:16:52.400 --> 0:16:54.640 even more important to figure out what you want your 0:16:54.680 --> 0:16:57.120 life to look like moving forward. So you gotta think 0:16:57.120 --> 0:16:59.720 about the lifestyle factor, right I mean, owning a home 0:17:00.400 --> 0:17:03.400 is a time and a money commitment. You're talking about 0:17:03.440 --> 0:17:05.800 fixing leaky toilets and a whole lot of other not 0:17:05.920 --> 0:17:07.720 so fun things. They become a part of your life 0:17:07.960 --> 0:17:09.560 when you own a home. Man, We've got this like 0:17:09.600 --> 0:17:12.880 toilet that keeps running, and I've got to figure out 0:17:13.080 --> 0:17:14.679 how to fix this thing. I've kind of checked and 0:17:14.720 --> 0:17:16.760 it's it's not the flapper you give it the old jiggle. 0:17:17.240 --> 0:17:20.640 You can sometimes you can running well. I mean it's 0:17:20.640 --> 0:17:22.600 not just toilets too, right like, because I feel like 0:17:22.600 --> 0:17:24.680 that's kind of a that's what we think of. But 0:17:24.720 --> 0:17:26.879 I mean, like Essentially, when you buy a home, like 0:17:26.960 --> 0:17:29.680 you have to become versed virtually, I think, in all 0:17:29.760 --> 0:17:31.800 systems of a home, not because you have to be 0:17:31.840 --> 0:17:34.080 able to know how to do something beyond just the 0:17:34.160 --> 0:17:37.600 jiggle on the toilet handle, but to know what type 0:17:37.600 --> 0:17:39.920 of repaired person to call, and to know whether or 0:17:39.920 --> 0:17:41.520 not they're ripping you off, and to know whether they're 0:17:41.560 --> 0:17:44.160 doing a good job. Like, these are all things that 0:17:44.240 --> 0:17:47.159