Breaking news as the housing market Collapse continues as price shock not Payment shock grips the nation and more And more people are starting to figure Out that purchasing a home can be a Horrible idea and let's not forget you Guys that the housing market is Incredibly divided or rather bifurcated There are places like Austin Texas that Are down year over year over year over Year and places like Santa Ana that are Up so it's extremely important that you Understand in order to really understand What's going on in your housing market You must do hyperlocal subdivision Analysis and towards the end of this Video I'm going to tell you guys what The solution is if you guys want to Become a winner on the other side of the Housing market collapse before I go into Redin I want to jump in and I want to Talk about the cheerleading that we're Hearing I've been seeing a ton of Comments where Realtors are coming out Saying that buyers are out in full force Now that rates are lower everyone and Their mom has come out to purchase a House and do you guys remember two years Ago we heard Realtors and loan officers Say that as soon as rates go down there Will be a flood a flood Moses would come Back there would be a flood of buyers so You better hurry up and buy you guys That was a flat out lie let's start out
By taking a look at rates and demand now As you guys can see here this is from Mortgage News Daily this is the purchase Index versus the 30-year fixed rate Mortgages now that big red line that you See there is representing right before Rates started going down they peaked at About 7.22% fast forward to today rates are About 6.2% that represents a 102 basis point Decline in interest rates which Represents an increase in purchasing Power listen 10.2% so that's actually Really good so if you've been waiting Congratulations you should have I know There's inflation but you should have 10.2% % more purchasing power in other Words rates have gone down a lot in a Very short amount of time meanwhile Demand when we compare the same time Frame demand has gone down with interest Rates so again instead of demand going Up when interest rates go down demand Went down with interest rates going back Into the chart you can see that blue Line represents the purchase composite That is not counting refinancing this is Only purchase so it went from 141 .7 down to 131.8 so it's fair to say and I'll show You guys some more data that demand did Not come back jumping into this week's Redfin article titled falling mortgage
Rates mean housing payments are now more Affordable than a year ago despite Higher prices now as you guys can see This was released today as September 12 2024 let me read the bottom part for you And you guys tell me whether or not you Agree because they're saying that demand Has not come back because of the Nar Ruling again they're saying the demand Has not come back because of the National Association of realtor ruling You believe this falling mortgage rates Have pushed the median US housing Payment near its lowest level since January but Penning hom sales have yet To improve there's more acknowledgement Many wouldbe buyers are hoping rates Fall further and I highlighted that Because haven't we played this game Already are you not getting it red fin Why why do you keep saying that and they Go on and others are waiting for clarity Around the Nar rules do me a favor y'all Let me know whether or not you think It's about affordability whether or not You think it's about elevated prices or Do you guys think it's about the Nar Ruling comment below I want to know and I want to hear from you now let's go Into this week's fear of missing out Paragraph from the redin realtor this Week's fear of missing out States one of My buyers is under contract on a home But he's trying to hold off closing
Until the end of the month in hopes that Rates will come down and he can get more Bang for his buck that's interesting I'm Also seeing people postpone until after The elections buyers tend to be more Careful about financial decisions around Consequential election the people who Are buying are doing so because of major Life changes like divorce or new job and There's no mention in there again about Elevated prices and over overwhelming Unaffordability they don't they don't Ever talk about National payment to Income ratio PE ratio massive Equity Buildup how pretty much all prices are Artificially created how income never Kept up I mean my goodness what are they Good for exactly comment below I want to Know what is redin good for let's keep Going leading indicators now very Interesting because we have additional Data again suggesting rates are going Down and demand is going down at the Same time so again if you're on the Sideline so far congratulations we have Overall we have things in our favor Happening in the housing market now take A look at this guy's leading indicator Starting with the daily average you guys Can see this is even a bigger Gap so This is saying that rates are now on a Daily average 6.11 this time last year they were 7.3 So over a 100 basis point difference you
Guys see the weekly average is 6.35 to 7.12 and look at all three categories of Demand are down mortgage purchase Application down 3% year-over-year redin Home buying demand down 7% Year-over-year Google homes for searches Down 16% year-over-year and again to the Realtors that are saying that buyers are Coming out in full force what are you Talking about guys do can you stop Saying things like that can you stop Yourself from cheerleading and can you Start helping the community and guess What if you're a realtor if you're Listening to this I know exactly how you Can help the community start teaching The how to fight property tax course Let's move on to median sales price and The first thing I want to do is I want To calculate and I want to make sure That redin is doing the math correctly Because one thing that I've constantly Shown you guys is they're not doing the Math correctly and it's not even hard Math it's simple math so the first thing I want to do is I want to remind you as The viewer what the record high was take A look on the screen here the record High was July 7th and that amount was 395,000 And in the detailed section below so we Have two confirmations of the median Sales price and the date now when we Look at the key housing data here we see
That the new median sales price is now Down to $388,500 below the alltime high during The four weeks ending again July 7th but I did the math on the upper right I took The record high and I took this week's Median sales price and I subtracted it And you guys it's closer to 8,000 than It is 6,000 with a difference of $7,810 and a lot of people like who Cares it's only $2,000 difference $1,900 Difference well I care because I expect And I would assume that a data provider That is responsible for educating us on The housing market would get simple math Correct I don't care if it's off by 1015 $20 I don't care but the fact that they Are regularly off on simple math to me It doesn't really demonstrate that we Can even trust them unfortunately I'm Stuck talking about their data let's Keep going let's now look at how Bifurcated or how divided the housing Market is by taking a look at the Winners and losers and I'm going to tell You guys right now it's between Texas And it's between Florida but as of right Now Texas is leading the way take a look Texas right now has the top three Metro Areas with price decline now the total Amount of Metro areas that do have Year-over-year price decline is eight And I also want you guys to know that we Are going to start coming into seasonal
Price decline which will make the Existing price decline compounding which Is especially good in other words the Price decline should speed up now that We're going towards the end of the year When seasonality takes more a toll on Prices nevertheless you guys Austin is Leading the way down 4 % year-over-year And my heart goes out for most people in Austin that is year-over-year over-year Losses for Austin number two Fort Worth Number three Dallas a lot of people Didn't think that Fort Worth and Dallas Was going to be on this list but I have Been warning you guys it absolutely is Going to be on this list one primary Reason is is there's not enough Migration to feed the overwhelming Hypers supply of new homes now number Four is our first Florida Metro with Tampa Florida down 1% year-over-year and Jacksonville Florida down 7% Year-over-year those are the top five Metros with decline but remember it is Still about subdivision now taking a Look at quote unquote the winners number One is Milwaukee up a whopping 11.6% Year-over-year Providence at number two At 10.5% nashaa County up 8.8 new bronswick Up 8.7 and a Florida in there Florida Make up your mind Florida which side do You want to be on but Fort Lauderdale is Up there up
7.9% year overy year now let's take a Look at pending sales because again what Do we hear buyers are out in full force What are you talking about however sales Are declining the fastest in three Metro Areas in Florida so Props to you melody You may catch up with our bet however West Palm Beach is leading the way down 19.8% with pending sales that's a great Thing that means that market is cooling Down number two of course is Miami down 18.8% a lot of stuff going on with Condos also in Florida really really That situation number three is Fort Lauderdale down 16.9% year-over-year with pending sales Meaning that housing market in Florida Getting ravaged let's start going into The data visualization from redin Starting with median sales price as you Guys can see here we are down from the Peak and I wrote that out here exact Math from their figures their inputs Even though these inputs I don't even Think are I don't even think these Inputs are accurate because of the Proprietary way they calculate it but Whatever ever it's down $7,810 from Peak now underneath that Just so we can all stay up to date we Need to go down roughly another $227,000 which is a lot if we're going To end this year with year-over-year Price decline because all the way on the
Left there I wanted to let you guys know That we started the year with a median Sales price a proprietary fraud index Information at 361,000 so keep your eyes on this info Take a look at home buying housing Payments and remember we heard people Are going to rush back in the market Take a look at home buying housing Payments you guys we are now under 2023 Isn't that cool well not really Because we're almost not quite but we're Almost ,000 above 2021 and that's why Demand is so low who cares if it's down From the high when it's up $11,000 Practically from a few years ago Absolutely crazy but it is interesting To know it is under 2023 but not because Of prices because of interest rate the Price remember is more important when we Look at pending sales it's an additional Data set that is explaining to us that The housing market is collapsing and It's an utter dumpster fire right now Unfortunately we need more time to go by Why inflation inflation is incredibly Sticky and we have a Federal Reserve That has been manipulating the housing Market for the last 20 to 30 years However when we look at pending sales That is down 8% dumpster fire 8% Year-over-year and in last year real Estate was in the gutter and it's even Worse than that this is a four-year low
For this time of year this goes back to The 1980s low we have lower demand lower Transactions right now than we did During the great financial crisis think About that so again to the people that Are saying buyers are coming out in full Force either you're new to the industry And you don't know what you're talking About or you're straight up lying I want You guys to do me a favor comment below What do you think why are realtors Saying buyers are coming out in full Force right now when the opposite is True is it because they want to sell you On buying a house so that they can make A commission H when we look at active Listings we're at right now [Music] 99683 so we are now under a million That's okay it is what it is in 2023 Remember you guys we went up into November however right now we've been Going down for a number of weeks I'm Going to be keeping my eyes on this I Don't like that trajectory straight up I Don't like that trajectory we need this To maintain over 1 million so we're very Close to that but I do not like that Trajectory keep your eyes on active Listings when we measure active listings To demand we get something called Supply And here's what that chart looks like Currently we're sitting at 3.8 months of Supply which is absolutely fantastic
Because that matches and I want you to Think about this that matches 2019 in 2017 levels but back in 2017 and 2019 we Didn't have the massive housing market Bubble that we have right now so we Don't even need this much supply for House prices to continue to go down all That needs to happen is more time needs To pass as the economic engine starts to Fumble and that economic engine Unfortunately is Mom and Pop which is Why the Federal Reserve is so bad Because at the end of the day it's Always mom and pop that pays for us and Why do we always talk about Mom and Pop Because I'm mom and pop you're mom and Pop and we matter moving on looking at a Second leading indicator that I keep my Eyes on which is days on Market the Longer that a house is on the market the More likely it is that that seller is Willing to negotiate with you and the More likely it is that the price will go Down and anytime we're over 30 days Generally it's a lot of pressure on Prices to go down and right now you guys We're sitting at 36 days we are ahead of 2022 I mentioned 2022 a lot because in 2022 second half we had deflation l Prices went down on a nationwide average But we started the beginning of 2022 With a hot housing market and then don't Forget the Federal Reserve started doing Quantitative tightening in March of 2022
So a lot happened there but regardless Homes sitting collecting dust we're Ahead of schedule when compared to 2022 The last data set I want to go on and Another leading indicator is price Cuts All right so right now we're sitting at 6.6% Price cuts no mention of this in The headlines with with red fin and Personally I would appreciate that Because as a seller I would like to know Like hey maybe I should cut my price Down so that everyone else doesn't do it At the same time that they listed if we Have a flood of inventory hit the market But regardless of these historical price Cuts we are ahead of 2022 and again this Is an additional leading indicator the Solution number one is awareness and Number two is your empowerment growth And action and I have tried to hold as Many people's hands as possible that Wants to be empowered now one way I do That is I've made a form called a Subdivision analysis form with this form You can use places like Zillow or Preferably a realtor that has access to MLS and you can calculate things like Wedge and things like cash flow even if You're not purchasing a home to invest In you should still use these Fundamentals when purchasing your Primary residence but in addition to That form I've also made courses take a Look at my free school which hopefully
In the near future I'll start teaching Stuff but take a look I have not only a Home buying master class which every Single person should take this I don't Care if you're a realtor in fact if You're a realtor you should take this 100% take this because it will help you And as such it will help your clients But not only do I have a free home Buying class I also have a free fight Property tax in other words you guys I'm In this with you and having said that Happy Thursday comment below like the Video share with me your sites and if You're out there investing in real Estate then I think you're absolutely Bonkers but I hope you win
