Why Buying A Home Right Now Could Be The Worst Financial Decision Of Your Life

So, I was recently having this conversation, actually last weekend, and I noticed, I use Redfin when I'm researching real estate, and the purpose of me researching real estate was for design ideas for a new house. Like, what is, you know, the luxury market doing in the bonus room? You know, how's the pool design? Like, just cool ideas, right? And I'm on there very consistently, but I set the parameters at anything over two and a half million, anything over 5,000 square foot, and I specifically use Redfin. I just think it's very user-friendly app, and if you know how Redfin works, if you've seen a property, it's a dark color, and if you haven't seen it, it's a lighter color, meaning it's a newer listing. And so, when I put in the parameters and I'm looking for design ideas, whether it's outside or inside, my phone lit up a lot more light colors than dark colors. And again, I'm on this pretty consistently. Like, it's almost like one of those things where you're on the toilet or you're bored, you just, I pop open Redfin and like to look at cool houses. I probably should have been a realtor in a past life, but to me, this was like, whoa, I thought I've seen everything in the market. You know, it's just all these new listings. So, my executive assistant has access to the MLS, so I contact her and said, hey, I'd like to know how many listings were on the market in this area, and I did Nashville and the surrounding counties, so like five total counties. Well, I didn't, she did it. And I said, I'd like to know how many were sold four months ago versus now. And she came back and says it's nearly doubled. So, there's twice as many homes in the luxury market for sale than there was four months ago. I'm like, that's odd. Too early for it to be AI driven. Maybe there are some of those that are like, hey, we're liquidating now because either our business or our jobs are either threatened or lost because AI has already, I think it's a little early for that, right? So, that might be ones and twosies here, but I was like, man, this is weird. How did the inventory double what seems like overnight? It could be, as me and Sean were talking, if you're in Nashville, Davidson County, they had a pretty substantial property tax hike. So, there could be a big mix that are coming from Davidson County and selling those properties and wanting to migrate into Williamson County where it's more tax friendly. So, it could be that, but again, it's not all Davidson County. This was five surrounding counties. So, anyways, so I'm like, something's up. I just kind of want to know. And I put it on social media and there was a few realtors that responded, but no one really could pinpoint like, all right, here's what I'm seeing and why. Whether it's builder this, builder that. Well, then I get a message last night. So, a week later and it's a Twitter ex post from No Limit and we'll post it in the comments or we'll do a screenshot of this, this chart. This chart should terrify every homeowner in America. Buyers just hit a record low of 1.36 million. Meanwhile, sellers are climbing fast, nearly 2 million. The huge gap, that's the housing market slowly dying. People locked into two to 3% mortgages during COVID are finally being forced to sell. Job losses, divorces, relocations, et cetera. But on the other side, buyers are gone. And it's easy to understand why. The average mortgage rate is sitting nearly 7%. Monthly payments on a medium priced home have nearly doubled since 2021. First time buyers are simply too broke. The affordability equation just doesn't work like it used to. And sellers are starting to compete with each other. Markets that overshot the most during COVID, Austin, Boise, Phoenix, Tampa, get hit first and the hardest. Then it spreads everywhere. The Fed cutting rates won't save this either. Even if we get back to 5.5% mortgages, the damage to buyer psychology is done. The housing market doesn't crash overnight, it bleeds slowly. And this chart is showing you the early stages of that bleed. More sellers, fewer buyers every single month. Housing prices are already dropping as we speak, and it's about to get worse. Be careful. So yeah, I was talking to a lady this morning out of Oregon, and she's sitting on a $2.9 million property. And based on the conversation, she's like, I don't want to give it away. And I was like, what do you owe? What do you mean by give it away? It may be the time to liquidate, because we have new threats on the horizon and opportunities, I might add, that we have never seen before in human history. So like I said, I don't think that the explosion of inventory is AI driven yet, but something's going on. And she's talking about, I want to hang on to this, and I'm in a new career. And I think we should all, I'm not telling people what to do. I'm just saying, what's up? And I'll give you an example. We're building a new house, and it's roughly $350 a square foot. Well, that's based on today's prices for lumber and demand for lumber, supply of lumber. And it's also based on comparable homes that sell that would demand that type of price per square foot. Well, if I were to wait a year or two, and I wouldn't say nobody's building, there's no such thing. Some people are still going to be building. But demand, lumber prices go down, construction costs go down, comparable sales, people have to reprice. I've already seen it in the luxury market, where people were pricing their home at $10 million, and then they end up selling for $7.5 million. That's a significant price correction, right? So I'm already seeing that. And if it gets exacerbated, then it just causes me to pause. Why would I pay today's prices when I can pay tomorrow's prices that are potentially substantially cheaper? So again, I'm an eternal optimist. I think there's an opportunity in almost everything. So if you've been sitting on the sideline as a homeowner or non-homeowner, and you want to be a homeowner, I would wait a little bit. I think things are going to get significantly cheaper. So don't pay now. Now, here's the other thing. You can never adjust the purchase price, but you can always adjust the rate and the debt tool that you use to purchase it, right? Because you'll hear mortgage lenders tell you this all the time, date the rate, marry the home. Well, the purchase price is the purchase price. So if you get in now, you could potentially be buying a home at a higher price than a year from now. So I think there's opportunity in everything. I think if you want to get into real estate, it's about to get significantly cheaper. So again, if you liked this video, we share more information like this, even though I wasn't the one providing value. I was only giving my commentary, but we are scouring the market looking for invaluable charts that kind of give us the signal versus the noise. There's a lot of noise out there. You know, people telling you to do this, doing that. Hey, it's great. The economy's great. Inflation's down. You know, that's all noise. We focus on the signal. So we share this all the time. If you like it, please hit the like button, subscribe, hit the notification bell. Y'all take care. God bless.