Are we headed for a REAL ESTATE CRASH?

 




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 Are we headed for a REAL ESTATE CRASH? 





Introduction and Setup

You're right quick, let me get myself centered. 

Overview of Real Estate Regulations
These two articles that we're going to look at. One's a YouTube video. This guy talks about some of the regulations and regulatory bodies that are monitoring the real estate market. CFPB don't ask me what that means.

It has everything to do with the regulation of the interest rates, the loans, and the lending market, which ultimately affects us as homeowners, this could be one of the tipping points within our house of cards, which is the GDP. It's important to understand because if you don't pay attention to what could hurt us on one specific, industry, could be automotive, could be health, could be real estate, one of those Things could tip off a huge domino effect and hurt our economy.







Investor Activity in the Housing Market

So it's wise for us to understand what's going on here This one right here is from Scott's Bean Guide a media outlet for the lending industry and they're talking about how investors are slowing home purchases just like everybody else and they're down.

They're down a lot, mostly in Florida and other states that are seeing declines like in Austin, and DC, which is. Going through the whole Trump evacuation exodus thing the thing we have to look at is from the investment point, is it hurting us?

Now down at the bottom, it says investors purchased 32, 000 homes in the fourth quarter, which is down 1. 6 from the previous year. And since 2016, investors also snapped up 8, 220 condominiums down 13 percent from the years before.




Regional Real Estate Trends

Now, if you look here, it also says that cities seeing the most investor interest in the fourth quarter were taught by Seattle and San Jose.

Oakland, San Francisco, and Detroit. Detroit's an obvious one because you're buying 5, 000 homes there. But San Francisco, Oakland, and San Jose, that's a tri-metro areas of the Bay area. And you're seeing values continue to go up because there's no inventory and investors know how to buy houses there.

It's a smart, prudent place. 




Insurance Impact on the Housing Market

Florida, Chicago, Miami, Atlanta, West Palm Beach, that's because they're going through economic decline right now, mostly because of the hurricane insurance that's killing them we're having the same problem here in California because of the fire insurance, it's a little bit different because there's only certain areas that are affected when it's hurricanes.

It can affect the entire town, city, metro area, county, you name it. The whole state is really getting hurt by this. Now, That's not to say that we're not seeing huge increases in our insurance and our housing insurance. It's nuts right now. That's going to have to change for something to settle out.






Potential Market Crash Discussion

So are we going to go see a crash? It's very possible. We've been going at this for over a decade. I want to say 18 years now. And we really haven't had a breather or a reset since 2008, 2009, or 2010. That was the last downfall. It's been a long time. We need to see a reset. We need to see something lower our values so that we attract more buyers and make it a more balanced market because for the longest time, for almost two decades, we've had a seller's market and sellers are being very spoiled about it right now. 





High-Priced Homes Analysis


In our area that said Cupertino house is for sale, which is crazy when you think about it for three, three, and 4 million homes.

They're standard homes. They're just regular homes or 2, 600, 2, 100, 3, 200 square foot homes. These are standard regular homes built in 1935. This one was built in 1958. So they're normal nothing fantastic, but there's still 3 million. And it's only because there's not a lot of inventory right now.

Prices are going to continue to go up, even though demand has. Diminished, it's still pretty steady. For the number of houses we have for sale and the competition, we have to buy those homes. We're seeing homes sell at crazy high prices. Now this one, Jamestown, which is South of 85 closer to Saratoga High School, tries to stay out of this, but let's take a look at it.


It's a six-bedroom, three baths. 2, 500 square foot house. It's a standard house, 4. 3 million why is it not selling? Probably cause it's overpriced. It says it was priced decreased, but the original list price, maybe gone up and come back down. Nothing fancy to this house 

There's nothing fancy about it other than the fact that there are seven, or eight houses or pictures of the front of the house. It's nice looking. But, it's staged so you can't really tell what you're looking at other than it's just a standard home at 4. 2 million. Why? Possibly greed. You look at the rest of these houses right now and what's for sale.



I'd rather spend 4 million up in the hills away from the freeway. I'd rather spend 4 million on a five-bedroom house. Let's take a look at this one, right? There's nothing super fancy about it. Oh, it's a flag lot and you probably don't get a lot of land. But again, you're closer. You're in the hills. You're in the foothills of Cupertino.



While there's nothing fancy about it, you're still buying a 3,600-square-foot house built in 1938. When I say 1938, it's probably updated. The original time it was built was probably closer to 1938. Pebble Place, crazy, five-bedroom, three-bath. People are still going to buy those, right?

Especially if they're priced right now in San Jose, it's a little less price, even though it's a nice area. Everybody likes to go to Willow Glen, but you're not paying 4 million for a home. This guy's been around for a long time. Yeah, this one's brand spanking new. So five bedrooms and five bathrooms were built in 2018, probably built by an investor. And then they lived in it for a little bit and then they're like, I'm out. Walking distance to Lincoln Ave, which is what everybody wants, right? Are you willing to spend 4 million in San Jose and pay the Measure E transfer tax?

That's completely up to you. Not gonna do it. Wouldn't be prudent. 







Luxury Homes and Market Insights

And then, Bay Area Luxury Homes. Let's take a look at Waverly. Tallwood. This price decreased. Let's take a look at this one again. Now this is a nice picture. A nice first picture. I would have done one of the front of the house like that right there to show off that.

That's what you want to look at. This is a box Brownie. Everything's been lit up, but it's a nice-looking house. And it's only 24 million, six bedrooms, seven and two half baths, 10, 000 square foot home built in 2024. So this was purpose-built for a billionaire to come and spend their week while buying up companies.

There you go. 







Conclusion and Final Thoughts



If you're looking at selling your house, drop down this inspection checklist. It'll get you started on all the repairs that you need to get done so that when you do sell your house You don't have a lot of repairs to be done and the inspector that comes through won't have a huge list to scare away buyers, so download this thing right now.

 The tops by over a billion dollars in sales volume and numbers are going crazy. We have 1, 450 homes in contract right now. We've done a thousand sales this week. That's not right. That is not right at all. We've only done a couple hundred, so I'll work on this a little bit.

So there you go.

Hopefully, my mic is working. I've been having trouble the last week. We'll see what happens. I'm Vito with Abitano. Thanks for watching. We'll see you out there.





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Vito Scarnecchia

Real Estate Broker, Veteran, Dad

DRE#: 01407676

408-705-6817

Vito@abitano.com

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🔴 Willow Glen's five most expensive homes https://youtu.be/3A_E2ck0ePg



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