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Originally Posted by zx10guy
But some of us doom and gloomers are trying to say is buying a house is a significant anchor in your life and finances...unless you pay cash or have a significant reserve....neither of which are common with the US consumer. If the uncertainty out there, I don't see why anyone would get into a significant financial obligation until things shake out. They're living in a place now so waiting shouldn't be a big deal. This is all reminiscent of the last housing boom.
With office space, I guess you can say it's the same as home real estate....location location. The local news just put out a story that office space in the DC area saw its first significant decline in 10 years as leases go in default or left to expire without a renewal/renegotiation. Met someone recently who works in property management and she said a huge chunk of their customers are needing some sort of payment modifications/forbearance. They're taking whatever they can get out of their customers as it's better to get something versus pushing the customers over the edge into insolvency.
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I don’t think it’s anything like the last housing boom / bust. I don’t think the market now is flooded with people trying to flip or tons of people borrowing way over their heads and having been through a mortgage process last year, I think underwriting standards are far different today.
If people are renting now, but have enough money to put down and retain some savings, I don’t see the problem with purchasing now within their means. If they lose their jobs they won’t be much worse off owning vs. renting. There is still a housing payment either way. For people who live on the edge with insufficient earnings and savings, well I don’t think they should ever be buying.
For commercial, yes there are tons of tenants looking for rent relief right now, whether they actually need it or not. Those tenants will either recover soon or go away and get replaced by new businesses who also need employees. We are not yet on the edge of an economic Armageddon and while possible, so is recovery after a couple of years of sluggish economy.