Will this housing bubble pop already?

We've been looking for a bigger place for over a year now, and things are just getting insane. we were set to go bid on this place- https://www.zillow.com/homes/9975-Township-Road-68_rb/107274830_zpid/
Pretty much perfect for us (if a little far from civilization), but not a spectacular property. Pics are deceiving- the kitchen is TINY, bedrooms are small. I thought their plan to auction the place was ambitious- reserve was $300K and there was a 10% buyer premium, and buyer pays closing costs. Well, somebody offered $400K for the place and it's pending sale now. This may sound reasonable to some of you, but considering where it is, I bet 2 years ago it might have been worth $200K max.

 

I was fortunate enough to be able to get out of Austin. I owned my house there for 8 years, and in that time, it doubled in value. In the 3 years since I sold it, the value has gone up another 50K. It's absolutely nuts everywhere now and won't be slowing down anytime soon.

 

FREE MONEY FOR EVERYONE!!!

 

If I could just give a shout of thanx to Covid...

 

All the people I know in real estate have had very low inventory for the past two years so the prices keep climbing. I have a rental that I really want to cut loose in the spring so hopefully it can last a little longer

 

If it makes you feel any better, if that was next door to me it would be over 800k easy right now.

 

I think there is wave of people moving from parts of the country with extremely high property values (California, Washington..etc) to states that were historically cheap - Georgia, Ohio, whatever. That will keep driving prices up, plus low interest rates, and low inventory (builders can't build fast enough). Not to forget good ole Covid, and new way that people work/live - work from home / work from anywhere concepts. I do not expect a real estate slow down in my area.

 

those are maple dollars...so about $16 freedom dollars

 

Not a damn bit...but thanks I guess.

I understand all the reasons for the rising prices, but still don't get how people can afford it (my thought is...they can't...and at some point there'll be a bunch of foreclosures). We both have decent jobs and kids are pretty much grown, and looking at the numbers I can't see taking on the burden of a $300K place. We can do it, but there won't be much left over to play with, and if we lost one of our incomes we'd be fucked.

 

You’d be surprised the wealth in this country and more importantly others. Underwriting standards have gotten tighter since the GfC so all the crazy buying houses you can’t afford and stuff is pretty under control. Rates have a lot to do with it. Aging population and people
Leaving homes/$ to their kids is on the rise.

these are secular tailwinds for housing and then add in what others have stated about people moving, etc.

the one thing that’s frustrating is i was in the market for a place in Mammoth Mountain. I decided to let a family member join the hunt with me and own it together. Well since this covid thing a happened places are going crazy. That is one market that I feel is unsustainable. A lot of people buying vacation homes and I don’t know how much of it is covid or they truly want a place. Condos are literally up over 200-300k in a few short months. I’m not interested at these levels.

 

Every bubble pops, eventually, every time.

 

Unless you go there 3x a month you're better off just renting somebody else's stuff and investing your money.

The island I live on now is nuts for waterfront. Lot down the street is up for 600k and doesn't even have water or sewage or gas or electric.

I could burn my house down and still sell it for 350k. Market is insane here and will correct sooner or later.

 

I don't think it's a bubble type of situation. Property values that were under valued are rapidly catching up, because people are leaving over priced parts of the country.

 

IMHO, outside of the usual suspects, property values in the USA are, or have been, too cheap. Look anywhere in the world... real estate is quite costly, relative to personal income. USA has been a bargain for too long...

 

That is not too far from to where I grew up (Zanesville). Looks like prices are still pretty cheap out near Zanesville, but I wouldn't want to move back there. Only two reasons to even stop there: Tom's Ice Cream Bowl and Adornetto's.
As to leaving "overpriced" parts of the country, I haven't seen that happening yet here around DC. Market is nuts with very low inventory both close in and further out.

Also bubbles don't always "pop" sometimes they just leak down a bit.

 

That's why there are so many foreign investors......our stuff is cheap to them.

 

My wife sells new construction residential homes in Cumming, GA. Not far from HWY400, reasonable access to Atlanta. An area that was not long ago considered middle of f@cking nowhere. $600+K homes are selling like hot cakes, with no signs of slow down. 10 out of 12 buyers are moving from out of state.

 

they also are trying to diversify their portfolio and get cash out of their country. like the Chinese buying 50M penthouse on park ave.

 

yeah, as discussed in the great migration thread here: