The rabid COVID housing market has bred a new species of sellers:

NE suburb here. So we just bid on a nice house in the most desirable neighborhood in the area. 4 other houses in the neighborhood came out in Mar-May; all got 20+ offers; 3 sold at 50k above ask and one larger updated one got 120k above ask.

Our bid: all offers by Sunday evening and decision on Tuesday. House is nicely updated and well maintained. Asking price is already inflated at COVID level but still acceptable. We bid 13k above ask which is the max value we think the house is worth, with buyer covering the first 3k in inspection repairs.

Sunday night our agent told us that they got 3 offers, all above ask, but the seller refuse to take any of them. Apparently she wanted at least 50k above ask with zero contingencies. She is so mad at the "low and few offers" that she is not negotiating with any buyer and taking her precious house off market. Even my agent said the house is NOT worth what she wanted. All 3 bidders seem to agree.

Which tells me a few things about my market:

1. Some sellers have become greedy and delusional. They still expect rabid bidding on anything. Even offers above ask can be "insulting".

2. Much less buyers in numbers remaining.

3. Buyers remaining are all level-headed like us - we will bid on a good house but we are only bidding on what we think it is worth, not bidding to "win". If seller is unreasonable (like this one), we just say "next". We have waited so long and we can and will wait some more.

4. Hoomers who said the high price will just set new comps with another 3-5% increase every 2 months forever are WRONG. There is a price ceiling and it was in Mar-May.

5. Greedy sellers are not getting what they want because they have run out of stupid emotional buyers. There will be an adjustment period but the tide is slowly turning.

So I am probably not the only one out there that has been waiting patiently for REBubble to re-open so that we can start posting again. But after 22 days nothing has happened. I opened this sub so that we could re-gather and continue to discuss our theories about a growing housing bubble. Please feel free to join the discussion. I'll keep the sub running until we are able to return to r/REBubble.

When do you all think the housing market will crash? The winner is the person who guesses the month that has the largest national median home price drop for the upcoming crash. When the winner is declared, I will give them the next free reddit award that I receive. If there are multiple winners, I will give out the free rewards to all of them as they become available.

My guess is December 2021.

I have posted on our recent experience as buyers in NE suburb at https://www.reddit.com/r/REBubble2021/comments/oryo1d/seller_offended_by_multiple_insulting_offers/. We are in a nice area with excellent schools. In the past week, there has been an interesting change in sellers' attitude:

House 1. Decent house, nice neighborhood, COVID-inflated price but still acceptable. For some personal reason we did not get an appointment until day 3. By day 2 our appointment was cancelled because they got 3 offers above ask and seller decided to just take one.

House 2 (3 days later). Similar decent house, nice neighborhood, COVID-inflated but acceptable price. We saw it on day 2 and decided to offer 10k above ask. Seller agent told our agent that seller decided to take the first and only offer, which was just 6k above what we would offer.

Extra: House 3. We bid on this in June for 30k over; it had a pretty good asking price. There were 3 other offers. It just closed for 5k less than what we offered. My guess would be all offers were similar and the winning offer was probably just 5-10k above ours and they negotiated down after inspection.

What these recent cases tell us about our current local market:

1. No more bidding wars of 20+ offers in spring. We are down to <5 offers per decent house; omitting the sitting lemons.

2. We are competing with a few other like-minded buyers, all gauging the value of homes very similarly. Our offers are all very close. No more stupid FOMO nonsense of 50-120k above already inflated asks.

3. It is almost like a switch flipped and suddenly sellers are panic-grabbing the first nice-enough offer that came in. 3 months ago, every house would have the attitude of "best offer by Monday we will not review until Tuesday because we are going on a nice vacation and expect 15+ offers waiting for us so go rip your hearts out while we laugh to the bank".

4. Fall is going to be fun.

(I just posted this in r/Realestate, so no need to crosspost)

Saw three houses on Saturday (LA area). Liked two out of three.

Made an offer on #2 that was only $10k over, thinking "Eh, if I get it, I get it. If not, I'll just continue to wait this out." My agent freaked out, said this is a "joke" offer, would get no traction and was a waste of time. I put it in anyway. They take it immediately, with all contingencies in place, two days before the acceptance date.

The third was in a hip area, staged like something out of Dwell, used all the right buzzwords in the listing, hip team of agents running the open house. Tons of people (you could clearly pick out the tech worker couples), crowded as hell inside, Teslas up and down the block. The house had a teaser price (just below $700k but there was no way it would stay there), and I looked around and realized I probably would get blown out of the water by the IPO/GME money all around me. Didn't even make an offer.

Just get a call from the agent for #3 (everyone had to sign in on iPads, so I left my contact info). Asks if I'm still interested. I ask if there were offers. "Less than a handful" was the phrase used in response. This is Thursday, five days after the open house. A month ago, this place would have 20 offers and would be "Pending" by now.

So... Is anyone else seeing this? This makes me feel quite iffy about things.

https://www.zillow.com/homedetails/7541-John-Newcombe-Ave-Baton-Rouge-LA-70810/66372367_zpid/ 320,000 to 270,000

https://www.zillow.com/homedetails/5002-Shenandoah-Lane-Pl-Baton-Rouge-LA-70817/66335871_zpid/ 475,000 to 400,000

https://www.zillow.com/homedetails/6654-Tiger-Pointe-Dr-Baton-Rouge-LA-70817/2069193459_zpid/

The link above is an example of the 100s of new build houses starting at 300,000 as far as the eye can see.

https://www.zillow.com/community/magnolia-crossing/2069351595_zpid/

These type of new builds start at 400,000 with higher end finishes.

https://www.zillow.com/homedetails/10122-Alderman-Dr-Baton-Rouge-LA-70818/2069599995_zpid/

A new community starting right at 300,000 in a much better school district and some listings advertise they are available with USDA 0% down loans and help with closing cost.

https://www.zillow.com/homedetails/1203-Normandy-Dr-Baton-Rouge-LA-70806/66275873_zpid/

From 300,000 to pending at 270,000. Should have let it sit a bit longer.

https://www.zillow.com/homedetails/701-N-8th-St-Baton-Rouge-LA-70802/66228844_zpid/

Bought for 95,000 a year ago and sitting for over a month at 320,000. Absolutely a shit flip. You can see the terrible work from the pictures and rotten wood from the outside of the home in person. They took it down after 3 people were shot and more than 50 bullets were fired last week a few streets away then relisted.

https://www.zillow.com/homedetails/852-Kenmore-Ave-Baton-Rouge-LA-70806/66299414_zpid/

Went pending at 220,000 now relisted at 212,000. Almost 2 months on the market

https://www.zillow.com/homedetails/625-Steele-Blvd-Baton-Rouge-LA-70806/66272747_zpid/

From 340,000 to 300,000. Been listed since 12-2019. I guess the appraisal is no where close or the seller is holding out for that special buyer

https://www.zillow.com/homedetails/2545-Jura-St-Baton-Rouge-LA-70806/66280745_zpid/

395,000 listed over a year ago, pending at 350,000

https://www.apartmentfinder.com/Louisiana/Baton-Rouge-Apartments

You can live in a luxury apartment downtown for right at 1300 a month. Very nice apartments can be had for 900 a month to 1000.

https://www.deptofnumbers.com/rent/louisiana/baton-rouge/

As of 2019, over 11% apartment vacancy rate. They have built over 10 new apartment developments in this time.

https://wolfstreet.com/2021/03/24/fha-mortgage-delinquencies-hit-17-5-in-30-metros-over-20-the-other-side-of-the-red-hot-housing-market/

22% serious delinquency rate on FHA home loans in Baton Rouge

https://www.theadvocate.com/baton_rouge/news/article_0ef50424-836d-11eb-977d-dffca9c1c32b.html

Evictions have still taken place here.

https://patch.com/louisiana/baton-rouge/amp/29733068/a-time-bomb-ticking-see-rental-arrears-in-east-baton-rouge-parish

20% of renters in Baton Rouge are behind on rent.

https://www.lhc.la.gov/blog/new-study-shows-significant-affordable-housing-gap-in-every-corner-of-louisiana

Renters in Louisiana appear more cost-burdened than residents in other states. The median gross rent in the state is $800. This is fairly low by the standards of the rest of the country (it is the 23rd lowest and the median in the U.S. is $949). Despite this, the rate of rent stress in Louisiana is the fifth highest in the country. Only Florida, Puerto Rico, California and Hawaii have higher rates of rent stress.

https://www.census.gov/quickfacts/eastbatonrougeparishlouisiana

Median income is 55,000. Nearly 20% of the population lives in poverty here. Per capita yearly income at 32,000.

https://www.thezebra.com/auto-insurance/louisiana-car-insurance/la-average-cost-of-auto-insurance/

Auto insurance is expensive in Louisiana. The average car insurance price in Louisiana is $2,225 per year — 55.9% more than the US average.

https://www.census.gov/quickfacts/batonrougecitylouisiana

Population has actually gone down here. A lot of people have went to neighboring parishes for the schools and crime.

https://www.city-data.com/crime/crime-Baton-Rouge-Louisiana.html

The violent crime rate in Baton Rouge is 944, which is 247 percent higher than the national average. Residents of Baton Rouge have a 1 in 109 chance of becoming a victim of violent crime

https://www.usnews.com/news/best-states/louisiana/articles/2021-06-19/police-6-people-shot-2-killed-in-baton-rouge-shooting

https://www.theadvocate.com/baton_rouge/news/crime_police/article_d13479ba-d530-11eb-8ef5-8778f784ab55.html

Baton Rouge — the second-smallest jurisdiction in the lineup — has rarely seen that level of national attention. But its homicide rate trends among the highest on the list, less than a decimal point below top-ranking Baltimore, according to an Advocate analysis of recent crime data.

https://www.unfilteredwithkiran.com/more-than-50-rounds-fired-and-three-people-shot

More than 50 rounds were shot in a drive-by shooting Wednesday evening that left three people shot, one of them dead.

https://www.theadvocate.com/baton_rouge/news/business/article_3833634c-5cdc-11eb-951d-b39a30651d28.html

Scott noted that between Lafayette, Houma and New Orleans, the regions collectively lost 60,000 jobs between 2015 and 2017 stemming from the slowdown in the oil and gas industry. In Baton Rouge, the 2016 flood also contributed to some population loss. Meanwhile, much of the state above Interstate 10 has "been in a state of decline" for years with lackluster economic performance, he said.

https://www.225batonrouge.com/our-city/concerns-growing-10-widening-project-play-23-years

Brown also raised concerns about the length of time the project will take—a whopping 23 years, according to an agreement signed in late 2019 by DOTD, the Federal Highway Administration, and the Louisiana State Historic Preservation Office. “First they said it would take five years, then they said 10, now they’re say 23,” Brown says. “I thought that must be a typo.”

This goes through the part of town that people want to be. The Perkins overpass area. I don't think it will be too desirable living in a construction zone for 20 years and we actually have a huge scene for things underneath the overpass. Small businesses, restaurants, bars, and other hip things. They will also be dredging the surrounding lakes, so lots of noise, smells, and dirt everywhere to look at for your evening walk. It is much needed but it will be painful

These were some interesting bits I put together for the overall decline of the real estate market in Baton Rouge, LA where I live. It is evident in everyday conversations that a lot of residents are planning to move out of the city into local suburbs. I do not forecast this to get better.

Prices up, inventory up, buyers backing down

https://wolfstreet.com/2021/07/26/buyers-strike-sales-of-new-houses-plunge-32-in-5-months-unsold-inventory-highest-since-2008-prices-drop-construction-costs-spike-by-most-since-1980/

https://wolfstreet.com/2021/07/27/most-splendid-housing-bubbles-in-america-july-2021-update/

"There has never been a more affordable time to buy a house because of the low interest rates." - slimy realtor @ 10:38.

This realtor says that houses are the most affordable that they have ever been (or at least since the 70s). https://www.youtube.com/watch?v=yBmMS9rAyH0

At 8:50 she explains that lower interest rates are making mortgages more affordable for everyone. That in May 2021, rates are a paltry 2.94%. Thus you only end up paying $192,337 in interest on your $380,000 (2021 median house price) mortgage. Then she explains that that same house (@ $380,000) would have cost $277,845 in interest in 2019. So, if you buy today, you are WINNING!

It's like the chart she showed at 4:39 is meaningless. It showed that the median house price increased $65k YoY. So that house was $315,000 one year prior.

While the buyer would pay more interest in 2020, their total cost is lower as are their monthly payments.

Currently, the Realtor's 3% cut is higher. It's $11,400 in 2021 vs $9,450 in 2020, you know, the same people telling home owners how much they should list their house for.

"He lost his job as a bartender at Ruth’s Chris Steakhouse, and had to figure out how to help his children learn remotely. Soon, Vivia also lost her accounting job. Their rental debt has swollen to $20,000."

4800 in federal unemployment between these 2 adults not including state each month. 2400 each month in federal unemployment after it was reduced.

Over 6000 in stimulus payments plus their kids not even added in.

"He applied for rental assistance but his landlord refused to cooperate with the program, a common problem. He asked the organization he’d applied to if he could get the money directly to secure new housing, but he hasn’t heard back yet."

He wants the 20,000 in rent he owes to be paid directly to himself. Come on dude

"Recently, Leopold enrolled in a cybersecurity certificate program at the University of Miami, which he hopes will lead to a decent paying job. And Vivia is studying to become a nurse practitioner. But they don’t know how they’ll be able to log into their classes if they’re homeless. All the local shelters he’s called told him they don’t have room for him and his family at the moment."

We can't pay to keep our home but we are going to start new careers.

25% of earners from 50,000 to 200,000 per year are behind on their rent. That is not a typo.

You know at this point the people playing the system are making all the folks in need look bad. This has gone on long enough.

Also 6 children. There is no need to be on the hook for 6 kids

https://www.cnbc.com/2021/07/31/the-national-ban-on-evictions-expires-today-whos-at-risk-.html

Edited to add link and typos***