kcbannon

@jonbrooks FOMO got too expensive.

Why are people not moving to Florida anymore?

@nickgerli1 Hard to believe there is still margin at $107/sf. Then again, you have no garage/carport, the house only has 6 windows, it sits on a 1/10 acre lot...

Pretty wild what Lennar is offering in Texas. $148,000 asking price on a 3x2 new build at 1,400 SF. Monthly payment of $950. And in some cases, they're giving a 5-year ARM rate of 3.3%. Many parts of Texas are correcting hard, and giving buyers a huge opportunity to buy at steep discounts. In this ZIP code specifically, values are down 13% over the last four years. Check the data for your zip on Reventure: reventure.app/mobile

@LinkedInLunat1c This is the same customer cohort that orders fast food from DoorDash and makes a $2.50 purchase on BNPL.

Yikes

@jonbrooks Not sure why so many people ignore the median-price to median-income chasm that currently exists. How much bigger does the elephant in the room have to be? And manipulating interest rates is NOT the fix because that is an inflationary disaster.

Everybody keeps asking where the buyers went. I don't think they went anywhere. They still want a house. They still want a backyard. They still want a good school district. They just can't make the payment work. That's the whole story.

@VladTheInflator The amount of stretching people are doing to get into homes these days (omitting cash buyers) means we are going to see a shit show when a real recession hits.

@jonbrooks Don't forget that covid-initiated WFH policies that turned once remote locations (think ID, MT, UT) into sought after suburbs.

The biggest lie in housing is that prices exploded because of a housing shortage. If that were true, prices wouldn't have skyrocketed in stocks, crypto, commercial real estate, private equity, collectibles, and luxury assets at the exact same time. What exploded wasn't demand. It was liquidity. 40 years of falling rates inflated everything. Now we're finding out what happens when rates stop falling.

@RonDeSantis Rates are at their long-term historical norm. House prices need to be allowed to fall naturally without any government or Fed intervention. Let cyclical recessions, baby boomer attrition and divorce do their thing.

Higher mortgage rates exacerbate the lock-in effect for those who purchased homes during covid when rates were historically low. Partly why the housing market has been so slow.

@Milajoy This argument uninentionally benefits cash buyers. Your angle is that you have been in your home long enough to have more than paid your fair share into the system. This should be more age-based regardless of whether the home is owned outright.

My home is paid off. Why do I have to pay property taxes on it?

@mukund You should report this merchant to Visa for surcharge non-compliance, since you cannot pay with cash. They will investigate this and the fines can get pretty hefty. Note that is only for the 3.5% piece of the bill.

I rarely eat out. Maybe once a month. Went yesterday to a restaurant (Italian, Mediterranean) in West Seattle for Mother’s Day last night. Total for 5 of us ( we don’t drink alcohol) with one salad, humus and 3 vegetarian pastas was $97 The check said 3.5% surcharge for credit card. Then 17% service fee, mandatory. Then tips were 20% 22% and 25% optional. I asked if I could pay in cash. No. They don’t take cash. Then how can I avoid the credit card fee I asked. You can’t. So I asked why the service charge. It pays for the employees they said. Then why the tip I asked. It pays for front office staff I don’t get it.

@jonbrooks Someone convinced the masses that homes should be treated as some hybrid asset that captures gains like equities but whose downside risk should be equivalent to government bonds.

If housing prices had simply followed income growth since 1970, the average home today would be $138,000. So… what actually broke?

@melefante6 Is that the Gatlinburg in the northern part of Africa?

In 2020, we put $110,823 into a $550,000 mountain cabin in Gatlinburg and bet that strangers would pay to stay there. First year cash flow: $109,000... That's nearly a 100% cash on cash return in 12 months. Two years later it appraised at $900K... We refinanced, pulled out ~$200K tax-free, and rolled it into the next property. This is the exact strategy I've been implementing since then, across now 14 properties. We bought it because we knew what it would become. Still cash flows to this day. If you want to learn how to find and set up your first cash flowing Airbnb, DM me "START"

@stelzner_n1150 Over time, valuation metrics always revert to the mean. In this case, median price to median income. Housing is long overdue for a correction.

A 40% decrease in home prices is good for the country.

@Tekeee You need a new abacus.

Savings accounts are at 5.25% right now. $2M in there = about $225K/year. Why aren’t more people doing this?

@BoringBiz_ If this true, then how do you define the "new" roles for these analysts when Claude or Chat are doing the cognitive heavy lifting? What is the incremenal value they bring?

Spoke with a former colleague of mine who is currently at a hedge fund and involved in new analyst recruiting for his firm He has been interviewing candidates from banking and private equity backgrounds for the past month or so Apparently there has been a massive surge in kids who simply cannot figure out what the business model or revenue recognition of a business is with just the 10K in front of them One of them completely botched the case study, and when asked, simply answered that he uses ChatGPT and Claude at his current job to figure out the details Clearly an early sign of cognitive decline in analyst capacity coming because of AI

@jonbrooks Holding cost fatigue from dead boomer houses will be an massive driver of downward price pressure.

I did the math. Boomer deaths alone could add 35–40% more active inventory every year in Florida over time. Every month: a little more supply. Every year: a little less affordability. The “shortage” crowd isn’t ready for demographic math.

@RonDeSantis I like your taste, sir.

Among many issues with this list, Metallica should be higher. Also, how can you not have Rush, Skynyrd or Van Halen?

@VigilantFox @elonmusk This whole "follow your passion" idea seems overloook roles like the military, oil rig workers, sanitation jobs, changing diapers of the the elderly. The list of hard but critical jobs is endless. Or do these folks not get to particpate in this utopia?

I respectfully disagree. It doesn’t address the sense of purpose issue. A lot of people go to work every day feeling needed. Like they matter. Take that away, and all you’re left with is unlimited free time, meaning more Netflix, video games, and consumption of X-rated content over doing something productive. I love my free time when I get it, but if I don’t work for it, I don’t appreciate it. Too much free time without any structure might not be the best thing for humanity.

Universal HIGH INCOME via checks issued by the Federal government is the best way to deal with unemployment caused by AI. AI/robotics will produce goods & services far in excess of the increase in the money supply, so there will not be inflation.

@EricLDaugh Vigilantism will inevitably replace what the justice system can't or won't do.

🚨 NOW: Calls for the death penalty are ERUPTING nationwide after DHS Sec. Markwayne Mullin confirms migrant Olaolukitan Adon Abel KlLLED DHS employee Lauren Bullis... ...and the man was naturalized under Biden. OUTRAGEOUS. MULLIN: "He possesses a prior criminal record that includes convictions for s*xual battery, battery against a police officer, obstruction, and assault with a deadly weapon, vandalism and now stands accused of m*rdering DHS employee Lauren Bullis by shooting and stabbing her while she walked her dog." "He has also been arrested for the m*rder of an unidentified woman whom he reportedly shot outside a Checkers, before randomly shooting a homeless man multiple times outside a Kroger in Brookhaven." "These acts of pure evil have devastated our Department and my prayers are with the families of the victims."

@0xrndusr @PeterSchiff It will be spiking job losses (near term) and dying baby boomers (longer term). The latter will have a larger impact because large numbers of beneficiaries will not be able to afford the carrying costs of these houses nor do they want to be landlords.

@PeterSchiff If this is worse than 2008, what’s the catalyst?

As inflation causes homeownership costs to soar, including mortgage rates, insurance, utilities, maintenance, and taxes, real estate prices will crash. The recent collapse in mortgage and refi applications is the tip of the iceberg. What lies beneath is a crisis worse than 2008.

@jonbrooks Force people to watch the documentary, Idiocracy.

My friends in their 30s are deciding not to have kids They’re saying two things: They don’t have the money It’s inconvenient to their lifestyle This is not good. What do we do?