Homes aren’t selling because they aren’t affordable. High interest rates are a big part of the lack of affordability, given the federal government’s large budget deficit and it’s impact on the long end of the yield curve, I don’t see that changing anytime soon and it will likely worsen. Pulling your home off the market because you won’t cut your price isn’t a great move unless you want to continue holding on to your home for many years to come.
This is exactly right. People have become fixated on their home being an investment and retirement fund. They can’t imagine that it is NOT worth $2M for a 3 bedroom 2 bath with 2 car garage. Also, the last 10 years of mortgage interest rates being lower than the rate of price growth allowed people to guarantee profit. Now that interest rates are higher than growth rates, it’s the opposite.
Some of them have been in those houses for a long time and have decided that they don’t need to sell, so might as well just stay there until the market recovers and they can make a bunch of money again. And if it doesn’t, they are still fine. If this is their primary home that isn’t sitting empty, then I’m fine with these people.
Some of them are just being stubborn and falling into the sunk cost fallacy. They bought the house recently, hoping to flip it. Now they can’t without taking a huge loss, so they will bleed themselves dry hoping the market changes. These people piss me off.
Homes aren’t selling because they aren’t affordable. High interest rates are a big part of the lack of affordability, given the federal government’s large budget deficit and it’s impact on the long end of the yield curve, I don’t see that changing anytime soon and it will likely worsen. Pulling your home off the market because you won’t cut your price isn’t a great move unless you want to continue holding on to your home for many years to come.
This is exactly right. People have become fixated on their home being an investment and retirement fund. They can’t imagine that it is NOT worth $2M for a 3 bedroom 2 bath with 2 car garage. Also, the last 10 years of mortgage interest rates being lower than the rate of price growth allowed people to guarantee profit. Now that interest rates are higher than growth rates, it’s the opposite.
Some of them have been in those houses for a long time and have decided that they don’t need to sell, so might as well just stay there until the market recovers and they can make a bunch of money again. And if it doesn’t, they are still fine. If this is their primary home that isn’t sitting empty, then I’m fine with these people.
Some of them are just being stubborn and falling into the sunk cost fallacy. They bought the house recently, hoping to flip it. Now they can’t without taking a huge loss, so they will bleed themselves dry hoping the market changes. These people piss me off.