Reaction & Commentary
If you’re a home buyer in these areas because you could see your Zillow home Value Estimate tanking over the next six to 12 months starting in a city like Nashville at number 10. this was a housing market that lots of people flooded into during the pandemic they
Pushed the prices way up well that’s not happening anymore folks in the result a massive surge in inventory a year ago there was 1600 homes for sale in Nashville now there’s 6 500 300 percent growth year over year a statistic that shows that the sellers in Nashville are
About to get very desperate in 2023 and I think we could see home prices decline by as much as 34 the typical home value in Nashville today is 421 000 and according to my algorithm that predicts home prices in America the fair value price is 2 276
000 that’s just how big the housing bubble has become particularly in our number nine housing market where prices are going to decline this is a city that boomed during the pandemic but now in Dallas Texas we’re not seeing nearly as many of those home buyers move in and
The result is once again the inventory has skyrocketed from 4 900 homes on the market in DFW a year ago to nearly 15 000 homes today I think a big issue for Dallas in particular is going to be the Sky High property taxes the average home in Dallas pays nearly ten thousand
Dollars a year in property taxes and the local homeowner and home buyer cannot afford it the typical home buyer in Dallas now needs to pay nearly 40 percent of their income to mortgage interest property taxes and insurance historically that figure was closer to 20 percent and so that’s not sustainable
Everyone people in Dallas can’t spend 40 percent of their income on house payments obviously the home prices need to crash probably by 20 or 30 percent now the number eight housing market I predict a crash in 2023 is very different from Nashville and Dallas this
Is a city that a lot of people left during the pandemic a place with sky-high home prices and now those sky-high home prices have started to come down because according to the California Association of Realtors in the San Francisco Bay Area our number eight housing market that’s going to
Crash we’ve actually already seen a 15 decline in home prices year of year down to one million dollars however one million dollars in San Francisco is still a lot of money especially when the local economy is getting pummeled by layoff companies such as Facebook Google Twitter LinkedIn DocuSign they’ve been
Laying off workers on mass over the last couple months and that’s having a huge impact in the San Francisco Bay Area a lot of homeowners are losing their jobs a lot of would-be home buyers are losing their jobs and that’s why I think prices will continue to decline aggressively in
San Francisco and San Jose in the surrounding area in Northern California for the rest of 2023 and really folks my model for understand ending and predicting home prices in America is very simple it comes down to three distinct aspects of every housing market number one is the housing market
Overvalued have the prices gone up way higher than the incomes and the wages if so prices are likely to decline especially if number two inventory is increased a lot there’s a lot of inventory sitting on the market that means sellers are going to get desperate and cut those overvalued prices down
Closer to their long run levels and then number three if there’s those layoffs I just discussed is the layoffs contribute to a huge amount of selling pressure and they cause something called for sales and our number seven city has all three of those aspects in Spades Boise Idaho
At number seven is a housing market that has already been crashing and will continue to crash throughout 2023. when I pull up my map of the most overvalued housing markets in America where prices are going to go down the most I look at Boise and I see a place where the
Typical home value according to Zillow is 454 000 but the fair home value that’s supported by income and wages is three hundred seventeen thousand so that implies that prices in Boise which have already gone down 10 from Peak could go down another thirty percent to the bottom of this crash and I’ve been
Reporting on the Boise Housing crash for the last 18 months now I first started talking about it in the middle of 2021 people told me I was crazy because they said there was so many remote workers who worked in Tech moving into Boise and buying up the houses but of course today
In 2023 we now see that that’s not such a good thing if you live in a city whether it’s Boise or the other ones I’m about to talk about where Tech workers remote Tech workers were moving in and supporting your housing market that city is going to crash because these Tech
Workers are getting laid off they’re getting called back into the office and they are now leaving a big housing bubble to be supported by the local home buyer and in our number six City this is a great example of an area where the locals do not make very much money and
They cannot afford the prices in fact in Tampa Florida our number six markets is going to crash the the median household income is sixty four thousand dollars a year and that median household income in Tampa compares to a home value of 361 000 creating a 5.6 value to income ratio
And the problem for Tampa is that this 5.6 value to income ratio is even higher than it was at the peak of the last bubble in 0.607 where prices then ended up declining by 50 percent over five years and so this has got to scare you everyone if you’re a homeowner in Tampa
That your Market is an even bigger bubble than it was in 07 which was the biggest housing bubble of all time and that’s not going to end well for Tampa there’s going to be big price declines on the order of 20 to 30 percent especially because the inventory is now
Skyrocketing going from only 3 000 homes on the market a year ago according to realtor.com to over 10 000 homes on the market today and so far Tampa and Florida more generally has weathered this housing crash pretty well we haven’t seen prices go down by much in
Florida yet but I think that changes in 2023 especially as the recession gets worse everyone because Florida is a state that relies on second home buyers and tourism to fuel its housing market so how is that going to do in a recession not very well especially in
Our number five housing market to crash Jacksonville Florida Jacksonville is a housing market that Real Estate Investors absolutely love they gobbled up a lot of homes over the last three years but now these investors have stopped buying in Jacksonville and they’re starting to sell because the rental market in the Jacksonville Metro
Is really starting to struggle and when you combine a struggling rental market with a housing market that’s 32 percent overvalued everyone the typical Zillow value is 350 000. the fair value in Jacksonville is 239 000. that implies we could see home prices in Jacksonville to climb by 32 percent over the next
Several years and to be sure I don’t think that entire decline is going to happen in 2023 it’s important to remember that housing crashes are what I call all slow motion crashes they take years to play out if you go back to the last bus in 2008 that was a five-year
Downturn if you go to the regional crashes that occurred in the early 90s in America that was a five to six year downturn so we are likely in the first year right now of a multi-year housing crash where you’re going to see prices drop by quite a bit in these cities in
2023 but then likely continue to drop in 2024 and 2025 and one housing market that I think is really exposed to these declines and that you need to be very very careful if you’re a home buyer is our number four City to crash Phoenix Arizona prices in Phoenix are already
Down by about 10 percent and could go down by another 25 to 30 percent and right now the sellers in the Phoenix housing market are already really feeling this downturn they’re getting panicked because the share of listings with a price cut according to realtor.com only 10 percent of listings
Had a price cut in January 2022 well this January in 2023 41 one percent of listings had a price cut look at that Surge and so for me personally there is no way I would be buying in Phoenix right now as well as the top three
Cities I’m about to show you they are cities and housing markets where they are over building the home builders went absolutely nuts in Phoenix they went absolutely nuts in our number three City and if the home builders are going nuts that’s just going to be a Perpetual flow
Of inventory both for sale and for rent and our number three housing market is one that the home builders absolutely love they went crazy in Utah particularly in Salt Lake City everyone take a look at this graph this shows the number of building permits pulled over
The last 12 months in Salt Lake we reached a peak in the middle of 2022 of 12 000 permits that was even higher than the peak that was reached in the early to mid 2000s and it’s an even crazier situation in nearby Provo everyone take a look at this surgeon building almost
Double what it was at the previous peak in o6 and those building permits can sometimes take two to three year years to turn into completed houses so we have a lot more Runway to go for added inventory and added price drop well most of these metros around Utah are about 30
Percent over value so there’s a lot more pain to come as there is in our number two housing market that’s set to crash in 2023 we’re almost at number one everyone stay with me you’re going to want to see what this number one city is but we got to talk about number two
First because number two is a historically volatile housing market like Phoenix it’s very Boomer bust and we have entered the bust stage definitively in Las Vegas Nevada Las Vegas is the housing market that’s dominated by investors and tourist demand which are things to do not fare
Well in a recession and we are already seeing that play out when we look at inventory in Las Vegas which has skyrocketed over the last year from 3 900 homes for sale all the way up to 8 500 homes for sale 25 above the long run average for January that added inventory
Is putting a lot of pressure on Sellers and Vegas to cut the price and boy are we going to see price Cuts continue over the next year or two because the data I’m looking at has Vegas pegged is still 26 overvalued the prices have already
Gone down by about 10 I think they could go down by another 26 percent so this is the thing to understand about this housing crash in 2023 is that some people say oh it’s not going to be nearly as bad as the one in 2007 and that might be true in certain cities
Vegas went down 60 percent in that last downturn and it could go down 30 to 35 percent in this downturn so that’s not as bad but it’s still pretty bad a lot of people are going to get wiped out whether they’re in Vegas or the other
Cities on this list or the number one housing market that I’m about to show you and before I show you this number one housing market that’s going to crash this year I want to invite you all to check out the data I showed you in this video for yourself if you go to
Www.reventure.app and create a free account you can access for every Metro in America how over or undervalued it is you can see my crash projections if you go to over under valuation as well as a host of other data points related to inventory and price cuts and typical
House payments which leads us to our number one housing market that’s going to crash everyone I think a lot of you might already sense or know what this housing market is if you watch my channel this is one that’s in complete free fall right now prices have already
Declined by 15 from Peak inventory is skyrocketing sellers are rushing to cut the price and there’s lots and lots of layoffs in Austin Texas pretty much every headwind for a housing market we discussed in this video including High property tax rates including layoffs it applies to the Austin housing market and
I expect we’re going to see prices in totality go down by 40 once again everyone go to www.reventure.app if you want to access this data for yourself it’s going to be free for a limited time
