“The everything bubble”

[coffee]

What are your thoughts about it? Do you think we’ll see the bubble burst this year? Are you a person who likes to “prepare” for these situations? Or do you prefer to ride the crash?
I just read Michael Burry bet against Tesla a couple months ago. I know I’m late with this news, but it made me think about this whole situation.

Personally we decided not to do anything and just to ride the roller coaster whenever it happens, but I might start saving a little more cash these coming months just in case it gets pretty ugly, whenever it happens.

[atarianna]

My personal opinion is that the real estate bubble will begin its descent the moment the moratorium on evictions and foreclosures is lifted.

[ellipses84]

I think we’ll see a little bubble in the real estate market. For other industries I think a lot was put on hold due to an unknown future and material shortages / shipping delays caused huge cost escalation so investors are not willing to take risks on projects that are coming in over budget. There will be a needed dip, and then people will move forward with big plans that will help the economy and provide jobs. I think retail /dining / entertainment / travel industries will bounce back because many went out of business so there are less options, and people want to let loose after quarantine (think of the huge rental car shortage right now). The monthly child credit will also alleviate a lot of tight budgets and pump more money into the economy.

[raangoli]

We will just ride out whatever happens. We have a lot of runway and if possible, we will try to also buy in if/when things go south.

[mlkgls]

The vast majority of my net worth is tied up in my retirement and home and I will continue to stay the course. I said in another thread that is feels a bit like Monopoly money, but I suppose that detachment will help if there is a dip. My area is seeing rapid growth so I don’t anticipate a real estate crash, but I think prices will normalize once inventory is up and the bidding wars cease.

I have a couple of home projects I would have liked to do this year, but am holding off until demand, and hopefully price, is lower.

[Pom]

Jun 18, 2021 6:57:38 GMT -5 raangoli said:

We will just ride out whatever happens. We have a lot of runway and if possible, we will try to also buy in if/when things go south.

+1

[sandandsea]

We will ride it out.

I dont think there will be a huge bubble burst but things may dip a smidge, housing inventory will increase, prices are likely to hold steady here but may not sell for 10-20% over list price for a while, but our savings are all earmarked for the long term and we are 15+ years away from retirement at the earliest so we will ride out a few ups and downs between now and then.

[Susie]

I'm going to feel a lot better when we close on the sale of our house.  We knowingly bought high this spring, since we were selling high too.  I just want to close the deal on selling high, JIC.

We closed on our purchase a month ago, and are supposed to close on our sale in <2 weeks.  We bought for $450k and are selling for $350k.  Two years ago our new house sold to our sellers for $375k, and our old house was worth about $280k.  So roughly the same $100k delta... as long as we sell in the same market we buy in.  

Everything appears to be green lit on our sale closing, but I'll still feel better when it does!  Talk of bubbles bursting while holding two houses is enough to give me insomnia.

[lolalolalola]

Jun 18, 2021 14:41:40 GMT -5 Susie said:

I'm going to feel a lot better when we close on the sale of our house.  We knowingly bought high this spring, since we were selling high too.  I just want to close the deal on selling high, JIC.

We closed on our purchase a month ago, and are supposed to close on our sale in <2 weeks.  We bought for $450k and are selling for $350k.  Two years ago our new house sold to our sellers for $375k, and our old house was worth about $280k.  So roughly the same $100k delta... as long as we sell in the same market we buy in.  

Everything appears to be green lit on our sale closing, but I'll still feel better when it does!  Talk of bubbles bursting while holding two houses is enough to give me insomnia.

We are building custom and with the supply shortages we won’t take possession until April or May next year. I am terrified of the burst when it comes to selling our current home.

[sadlebred]

I'm riding everything out. I'm not near retirement. I've been in my house for years and am not going anywhere at least that I'm aware of. I'm not worried about anything.

[kadams767]

Riding everything out. I am fortunate to be in a house I love, so even though the prices have escalated and demand here is insane, I got in earlier and am not priced out of my area. We’re able to afford the upgrades to our current place and even at high prices for projects, the added cost of just doing them here doesn’t come close to trying to find a different place that meets my needs/wants.

Cash and investments, I am staying the course except I have been a little hesitant to make my normal lump sum investment in my taxable account and am holding that cash. I’ll probably ultimately do it and just ride out a dip with that too, but no need to buy at the peak right now, so I don’t feel like I’ve missed anything holding it for a bit of extra time.

[wildrice]

I hadn't heard this term before. What is included in "everything" - stocks and housing?

Either way I don't think anything changes for us. We just bought our house a year ago, right before housing prices started going nuts so I think we paid a reasonable price for it. Our only investments are in retirement and we're probably 25ish years away from that. Other than my H needing to find a new job next spring, I don't see us making any major changes to anything in our lives in the near future so we should be fine unless the job market completely dries up or I somehow end up laid off, which is unlikely.

[Susie]

lolalolalola, godspeed to you!

[SusanBAnthony]

Wood prices dropped 40% in the last week, so that is a thing.

[MrsE]

Jun 22, 2021 9:03:23 GMT -5 SusanBAnthony said:

Wood prices dropped 40% in the last week, so that is a thing.

My H keeps reminding me of this since I insisted we put up a fence last month and we paid a premium. 😬Oops.

[icedcoffee]

Jun 22, 2021 9:03:23 GMT -5 SusanBAnthony said:

Wood prices dropped 40% in the last week, so that is a thing.

I had no idea wood prices fluctuated that quickly. That’s great though. I was worried it would never come down.

[lolalolalola]

Jun 24, 2021 7:22:14 GMT -5 MrsE said:

Jun 22, 2021 9:03:23 GMT -5 SusanBAnthony said:

Wood prices dropped 40% in the last week, so that is a thing.

My H keeps reminding me of this since I insisted we put up a fence last month and we paid a premium. 😬Oops.

I have friends telling me I should negotiate with my builder who I’m under contract with because prices have dropped. I’m that’s not how this works...,

[jlt19]

That's really interesting on the wood pricing. We have a contractor rebuilding our front balcony and when he went to price out wood vs. composite (b/c I don't care as we're selling) it was literally a $200 difference, so we of course went with the composite. But he's 4 weeks out, so maybe I'll ask him to re-price things before he purchases the materials.

As far as housing, I'm like Susie and lolalolalola in that, I hope we can sell before it bursts. We bought in late 2007, so high in the market, for $235k. We plan on listing at $350k and hope for a bit of a bidding war. To be fair, we've done a LOT to the house, like I don't even want to try to add up the $ we've put into it b/c we'd probably be losing. But, it's made us happy and that's really what money is for, right?

The house we put an offer on yesterday was built/sold in 2008 so at the height as well for around $350k. We offered $381k, and Zillow has it estimated at $389k, so I'm not overly concerned that we're overpaying much in comparison to what we hope to get for our house.

But I also need to sell while it's still summer b/c we have a pool and I want people to come out during one of the 90+ days with 90% humidity and see how amazing the pool looks, lol. It's all a psychological game!

Stock wise, I've been selling every time something goes up a certain %, so have a lot of cash reserves waiting for a dip. While we'll be using that for a down payment, once our house sells, I'll keep the same amount on hand with those proceeds b/c there's nothing $$$ that needs to be done immediately at the new house. Except DH is insistent on a golf cart....