Home Sellers NOW GIVING UP 1.9% MORTGAGE RATES! 

2024 The Year of the RETAIL APOCALYPSE ru-vid.com/video/%D0%B2%D0%B8%D0%B4%D0%B5%D0%BE-TNmttqX9WSk.html

Keep in mind that during the 80’s people were encouraged to save due to the interest rates. Right now there’s very little incentive to save because those who are saving are watching those who are reckless taking it in. I’ve been trying to save for a home and it’s been discouraging to watch prices continue to not budge because there’s people willing to get into a mortgage where they’re paying 40% of their income. It’s insane.

The mistake wasn’t figuring out rental/mortgage payment ratios. The problem was that people paid waaaaaaay too much for housing.

My dad hated going to work every day of his life, but he called his job the "golden handcuffs". It was too late to switch jobs because he had a family to support and a pension he would need later on.

Mortgage rates are currently at an all time high since 2000(24 years) and based on statistics on inflation, we might see that number skyrocket further, a 30-year fixed rate was only 5% this time last year, so do I just keep waiting for a housing crash before buying or redirect my focus to the equity market

I sold my va 2.25 rate assumed. Didn’t want to live there anymore. Home went up about 250k in two years. Sold it bought a home cash where we wanted to be half the size, new, way better neighborhood. I’m 60 but felt trapped with the 2.25. I wasn’t gonna let my rate own me. I don’t live to be entrapped in a rate. I took the gift of ridiculous price increases and didn’t get greedy. Now I’m mortgage free, live down the street from my family and much happier.

We have a 2.25% 30 yr mortgage and plan on staying in home for at least next 15 years. We are retired and loving life.

$5,500 a month is BEYOND outrageous. It's like the boiling frog syndrome: people don't know that their lives are out of control until it's too late. It boggles the mind how expensive real estate is now. Housing is not worth what people are paying for it. It's going to crash. Soon. No one can sustain these insane prices.

My dad used to say "Champagne taste on a beer budget". So buy some beer and pretend it's champagne.

First time buyers should watch this to avoid expensive mistakes

People need boltcutters. They need a plan that is much bigger than "how to buy a house" and afford it for a while. Inflation, taxes and insurance are what is going up and up, not RE itself. And commercial RE? A disaster. Auto loan delinquencies? Disaster. We are headed for a crack up.

The last condo I had in Florida even though I loved the place, the deciding factor in what prompted me to sell was when I saw the housing market slow down last time I went on the county property appraiser and tax collectors website and I looked up every unit in my building to see their purchase price. Sadly it turned out that I I paid the highest price than any other unit in the entire building. by approximately $60,000. Knowing that any of my neighbors could undercut me at any moment I decided to sell. You learn through experience. I wish I had known to look at the county website before I purchased. That unit got foreclosed on a year after I sold it and sat empty for 5 years.

The one thing that leaped out at me when I was working as a long haul driver was; I have no favorite place to live. Strange but true. I can't even imagine being locked into a long term ANYTHING at $5.5k/mo. That sounds like death to me.

Paid cash for my house 26 years ago. Apparently I am content with what I have and where I live. Thank God I'm not dealing with having to put a roof over my head, renting/buying, in this screwed up economy.

Owning a house is a illusion now as property taxes eats away your life.

And nobody never thinks about the dirty money laundering happening for years on those properties. They don’t care if those stays empty and if they overpaid : money has been washed.

Just sold our house today. We had 2.4%, and I don't regret it at all. What we saved in interest rates, we were dumping out the window in property tax increase. Gonna rent for a while and hope for a crash, or maybe just build a house with my bare hands. Something has got to give with this insanity.

Thanks Michael for giving people a realistic view of being a landlord. It indeed can be a nightmare. My father owned some properties when I was younger and I saw firsthand the challenges and never wanted to pursue that task.

I got a 2.25% rate back in 2021. Gave it up because we needed to move AND HOA started to not allow renters. Hard pill to swallow!

My rental property had a 3% mortgage. I was able to make a small profit on it for two years. Then the insurance doubled and I wasn't confident I could keep the rent competitive and break even let alone make a profit. So I sold it while I knew there was still some value.

Gave up a 2021 rate of 2.6. Developer lied about hundreds of section 8 apartments to be built next door. HOA rates went up 10% every year while we were there. Crime was absolutely abysmal. Assessed tax value went up $100k in only 2 years. It was a bad scenario. Obviously have a much higher rate now and things are tighter but we are in a much safer/better location and we are not in an HOA or in city limits.

If you’re not first. You’re last ricky bobby.

Refinanced 11 1/2 years ago got 3.25, just paid off mortgage in November 2023, loving life.❤

After the crash of 1987, every house I rented for the next 14 years was less than the owners’ mortgage payments. All of them took a “loss” until they sold the property.

As a result of Divorce, in Aug 23 - I gave up a 30yr fixed 2.875% mortgage in Georgia. I was on my way to Florida - but changed my mind based on the education of videos like Michael. I am cash rich and house poor....and enjoying the fuck out of it!

You should do a top 10 list of what buyers miss in there due diligence, for example, inspections, dot plans if any, hoa rules, irrigation water rates, family watchdog, crime maps, loan prepayment penalty, new property tax rate, neighbors yard encroachment, sewer line rotted or full of roots, pool leak, etc etc

Oh my GOSH Michael 😮. Another thousand subscribers. I’m very excited for you. You have got to be the fastest growing channel regarding Real Estate. You’re DEFINITELY CRUSHING IT 😊😊😊😊😊😊😊 Blessings,Carlos ✝️🙏❤️😊🇺🇸

FOMO is a childhood disease that most people have to go through at least once.

If you’re moving with your job transfer and you own multiple pets, you NEED to buy a house. No one will rent to you if you have 3 dogs and 4 cats.

I don't know how anyone can think these home prices are acceptable. Prices in the Sunbelt are due for a correction with most of the non-local buyers pretty much done. Its the locLs now and they can't afford these ridiculous prices.

Great analysis and advice Michael, We escaped the real estate insanity of Florida and moved to the Philippines in 2022. We are raising our two young children here and our quality of life and happiness far exceeds what we experienced anywhere we ever lived in the usa, I am 70 years old... I applied for Philippine Permanent Residency here and in six months my residency will be complete, we really thought outside the box on this one! God Bless all who are suffering and stressed out in the states...John

HA, yes "the golden handcuffs" is actually a phrase that refers to a state of entrapment due to a good benefit that holds someone from change - a "golden" benefit like your interest rate scenario. My aunt was a teacher and after many years said I have to keep going because of the golden handcuffs - the pension after 30 years. She made it! Without the benefit, she probably would've resigned sooner.

A Video from Michael is the perfect way to start the weekend!😊

I think what's crazy is that people don't understand that interest rates really don't matter because you have to factor in the cost of everything. The government can increase or lower the interest rates but that does not change the price of homes or the cost of food or anything else that you have to buy with a currency that is going down more and more in the buying power basically we're going to be like Zimbabwe eventually. Cash is getting hard to come by nowadays and everything is getting digital which means that the government can control and watch what you do and that impacts how they can dictate the prices of everything which then makes you a debt slave because you have to take out more and more debt to acquire these goods. For example just like a mortgage for buying a home you are not buying a home you were buying the debt to acquire that home and basically it is a very expensive rent-to-own program which for 30 years you're paying into and the government can screw you over by impacting everything else around you and let's say that you pay off the home early it doesn't matter because our money literally does not have any value in it, it's not backed by gold and people accept that because that's how the government controls you is by lending you money that they will always be able to adjust to make your behavior what they want. So enclosing your own nothing and be happy because the currency will never be enough to survive but you'll have just enough to make it through the end of the month. Stop playing in today's game get out of the housing market buy some land and do it like your forefathers did that's the only way that you're going to get your freedom is by being the master of your life everyday and you are rich because you have nothing that dictates or control you.

8 out of 10 contacts bought 2-3 homes in naples dec '22. all renovated and listed for 700-800k (size: 1000-1200 sf). they tried renting between 9k-10k, no one renting and no buyers. these homes started listing sept-oct '23. at the moment, total homes they have on naples market is 112. 112 homes!

My friend gave up his 2.5% in favor for a new state, in a way better neighborhood, in a way newer home. Even at 5.5% they pay less and are finally in a safe city. It wasnt that he was struggling with finances, it was the all the bad kids terrorizing the neighborhood while their dead beat parents did nothing about it. On top of that the violence and crime got out of control with all the Californian's moving into town. He made a good choice amd im glad it wasnt because of finance, just personal saftey. So not everyome giving up the low rates is because of financial problems.

We have golden handcuffs right now. My mortgage is so cheap compared to others around me. Good thing we are not looking to move anytime soon. My wife and I both work less than a mile up the road from our house. We’re here for the foreseeable future. But one never knows… Have a great night everyone 🍻

Not all of us just have a house, we have homes acreage, farms, animals all of that and when those big properties were bought at 2.3 like mine we are not stuck due to income reasons we are stuck because others don't qualify to buy

Yes, a book, course, or video would be great. You are the most honest real estate person on RU-vid!

My co worker had the same discussion with his wife. She was mentioning how much their homes value grew and that they could sell it and make a huge profit. He then says "oh yeah? Where are we gonna go? Everything is overpriced, and we'll just end up paying more anyway."

I think the sad thing is that this doesn't really apply to housing anymore it's also applies to everything that you want to get from auto loans to bank loans to anything that's tied to a contract that is impacted by the government raising or lowering hikes on the interest. I know that corporations have a say on what they will put down on interest on the monthly payments but this is just too much literally the prices of everything is going up. Even if interest on payments does come down, people do not understand that it doesn't matter what kind of interest you have. If you're literally buying a house for over half a million dollars even at a 2% interest that's still a lot of money to put down every month on something that you are literally renting to own. The only good thing about a mortgage is that this contract allows you to sell the home and recap the money back if you're able to make a profit. But if not right now, you're taking a loss so either way you're just pushing your debt around in a market that's already falling down. This in return makes everyone's homes go down in value which tanks the market and then eventually with all that weight it will come crashing down. The seller then realize that the debt to profit ratio is too big. And with the way that everything is going on I would be surprised if that lump sum of money is only able be survived on with a very restrictive and conservative and minimalist life style you'll eventually own nothing and be happy.

You should definitely put on a real estate for beginners video. As an older guy, im always amazed how many folks cannot calculate their total income vs total expenses and what percentages should go to what and often more importantly what is the value of certain purchases. Love your common sense content!

I think owning a laundromat or self storage facility would be a good investment. Having done neither, I'm just throwing that out there.

Miami Lakes went to see 3 houses for rent. I offered $700 less than rental price. I was denied right away. One week later bingo a homeowner gave in. Start offering less. $4500 for $3800.

A good property manager can absorb a lot of those headaches.

How about some very thoroughly detailed checklists---one for a stand-alone house and one for a condo. Start with the pre-approval process and end with the closing. Include everything in the lists that buyers should consider and do (and NOT do) during the entire process. I think that would be very helpful.

Never get emotional about a piece of real estate. You will probably make a bad decision buy usually pay too much. Always be able to say no and walk.

It's hard for me to wrap my head around that $13 mill property listing. They were asking $65k/mo rent, then dropped it to $50k. Wow, what a bargain! smh. That's more than I paid for my first house. And a $240k annual property tax bill. omg. What were people thinking?

It is about EQ to stay delay granitation. People who rush buying an overpriced houses has been influenced by realters and coporate media.

When it came to making the largest purchase in my entire life, I wanted to know everything and anything in the ins and outs before I even considered purchasing my house. I just assumed that everyone was like that I didn't realize so many people took it so nonchalantly. The fact that this will be the second time this has happened in the last like 12 years it wouldn't hurt to come up with a course.

It was as astounding how much money people were casually throwing around outbidding others. I had friends who casually through an extra $15k on their offer because their agent advised it. Sure, $335k Vs $350k is not a huge difference over a 30 year period, but thats still $15k…

Michael, you should have a course and charge for it. You may as well get paid for the information you are giving away freely. You have the charisma to be a great teacher!!

I live in Seattle area and the rent vs home values equation is way out of whack here. Unless you put 50% or more down, you are likely going to have a house that costs more than it can rent. It’s been like this for at least 8 years and it’s getting worse.

I speak from personal experience from the time I was in my 20s to my 40s, interest rates didn't matter to me. Getting the loan did. I'd pay anything to get a car. All I saw was the bottom line. When I started buying properties, I got them at such a low price. When I sold, I made money. And here's the most important thing. When I took a loan out, it was always short-term with a complete payoff from another property sold. I used banks to my advantage. I've never had a mortgage for more than a year. I own 4 now and am completely debt free.

Waited to get my first house when I could straight buy it out- also gave me time to see if I wanted to stay in the area and where in the area I liked. After that I was free to do what I wanted with my money as far a future properties (was in a stable place I liked, and no questions about my house). I see a huge renting boom since these house prices are out of control and rates not pleasant either. I see many people taking losses- already see it Austin and Houston.

You either have to give up the golden hand cuffs or you are up so much that you just wanna cash out and do something else, for example travel, rent, or just move in with someone. Giving up your low rate doesn’t exactly have to be because they have to.

I bought my home in 2016 for $602k. The had a 3% interest rate. I sold 5 months ago for $1.3M with multiple offers. I am sitting in a rental house for $4K a month. I plan to repurchase a substantially similar house to what I sold for $700K in a year or two for cash. Giving up the 3% interest rate wasn’t difficult to do when my plan is to pay cash for the next house…. And if interest rates were to go to 20% it only means my next house will be cheaper as most people buy on payment vs. price.

These MLS details are like watching two Trains collide - makes you wanna cover your eyes and your ears up, but you know you better "Turn and run "!

NO! If you start a course it will corrupt you. Stay true to yourself and what you are doing.

Michael, Concerning the vacant home purchased for 12.5million in 2021, 240K in property taxes and asking 50K rent There are obscenely wealthy individuals in the world. Used to be known as robber barons in 1800's. Unlimited funds available, We cannot comprehend their lives. Probably don't even notice the loss. Just a tax deduction. We have entered the age of robber barons again.

Nothing is more stressful than having to move and you cannot sell your place. When the rent does not cover the payments it takes integrity and realizing your error to hang in there until the situation turns around. My Husband and I had that situation when my Husband was in the military. He was transferred, and no matter what we tried to do, we could not sell our place. It took us NINE years to dig ourselves out of that situation. In fact we still have the property. It’s nice that the place is paid off, and we have been turning a profit, but it was bleak to slog it out.

You are right Michael , they really 😮thought just because they have lower mortgages that they will make a profit on renting. Unfortunately New York is the only place that someone can profit from renting. Florida is also a disaster when comes to make a profit.

The reason Seattle guy wants to leave is that Seattle is an even bigger cesspit than Portland. Just talked to old friend from there who was in Portland to attend an appointment at the va, spent the night in the city, actually had to dodge human excrement on the sidewalk. ( I defected to Australia about 14 years ago)

That is a great story and example to prove your point. A couple things i want to say is why did he buy a house in Seattle and complaining about the weather? I hope he doesn't think about moving to FL because we are full and we need less demand so prices continue to drop like they are currently doing. And his salary is very rare, but what is more rare is the fact he can move wherever he wants and still make that salary. You dont usually make that kind of money with a remote job. I know because I'm an aerospace engineer with a remote work from home job. So this story is the extreme case, and most other people will be in a much worse situation. People WILL be giving up those golden handcuffs and then trying to find a house that is overpriced by delusional house owners.

The only thing I wished I had was a larger lot. But I did okay with rate 2.49%

We got a 2 year 2.09% mortgage in Canada which comes due in March 2024 at which time we will pay it off and be mortgage free during retirement. It will just let me sleep at night knowing that interest rates can go back to 20% (like in the 1980s) and I will not loose the house.

There is close to 40-50% of divorces, so people will sell for that simple reason as well

Yes, a home buying course would be extremely valuable.

If you rent and dont stuff cash like you owned, you will fall behind. Those that buy are often forced to be that saver, built in as equity. Not realizing or changing your lifestyle is the culprit, if you rent.

Lawn home for sale signs are popping up in my area like weeds in a garden recently. Soon to be covered by snow.

let's face it seattle has become a 15 minute city and a hazard to live in. doesn't matter if you have 1.9 financing. the summer of love in 2019 showed the country what seattle had morphed into.

I wish we can go back to the good old 90’s life was easy and made a lot more sense back then

Seattle is very expensive. Not enough pain has been felt. Homes have become so overpriced, they rather keep homes empty thinking they will always sell it at a win. Price cuts are mostly only occurring to multi million dollars homes

I recently got a quote for my homeowners ins from my current company, State Farm (condo in MO) if I decided to rent it out. It’s cheaper than if I live here. Yea, I thought that was weird, but it’s true.

I'm 18 minutes into this video and you just were talking about a 13,500,000 dollar house for rent for 50,000 / month. I remember back in 2008 we lived in a waterfront community and a lot of the houses were being purchased by a certain ethnic group (foreign) with questionable access to money. It was almost laughable but of course the realtors had no problem with what was going on. I wonder if this isn't what is going on when you show listings such as this.

Barbara Corcran and Dave Ramsey-both cheerleaders for the real estate industry

Low mortgage rates allow for high home prices and high mortgage rates require lower home prices - generally speaking over time.

At current interest rates, I'd have to pay 1.5-2X more to buy the same house as I pay to rent it now. That just doesn't make sense. I'll wait until those two price tags get closer together.

Michael. Thanks for the videos. I watch them all. I enjoy hearing your observations on the housing market. For a long time I wanted to move from cold Indiana to Florida. Because I never pulled the trigger when I was younger when prices were a lot less I missed out and now just enjoy visiting about 3 times a year. I think a course on housing would be great. I would probably take that course just to improve my knowledge. I don't expect that I will be moving from my Indiana lake home at 70 years old but as you say life sometimes changes. Take care and thank you!

I bought my house back in 2016 at 4%. A couple weeks ago my mortgage lender sent me a letter telling me all about a fantastic opportunity to do a cash out refinance. Sounded great until I read the fine print: almost 9% for the new rate. No thanks. I'll stick with what I have.

I've lived on the Venetian Islands a long time in one of the interior lots. I'm the guy that talked about being self insured for windstorm recently. I've fixed it up nice for me and just plan on living here through the next down cycle that we must be entering. One guy has his old interior lot house listed for like 6 million dollars, not sure why he's even bothering. The house you pointed out on Rivo Alto for 4.25M that owner probably has 30k worth of insurance per year if it is mortgaged because it's not up to the latest code and this is a major flood zone. So over 60 grand in just taxes and insurance!!! That house is probably costing that guy 80k+ per year just to keep bare-bones idle(landscaping, pool, HVAC, etc). Right across from him is another house getting built, if I remember correctly, which makes that house harder to rent because who wants to spend that kind of money and live in an old dated house across from a construction site lol.

Yes, Mike! Me and my mom (still don’t know if this year or next) want to buy a home, so I think a course on purchasing real estate would be great to clear up some things.

Houses really work well over the long haul. Think 10 years increments. I took the view that the rental just needed to break even. I did not need the income. Then over 15 years the renter pays off your mortgage. So, it turns into income when you need it in retirement. Also works well as an inflation hedge. Patience required.

someone bought our condo in chicago in April 2022. I hope they're OK. I owe everything to Indiana

Peter Schiff explained this about 2-months ago, that the most valuable asset these homeowners have right now is their mortgage. He said a lot of people are going to want to stay in those homes, even if the home price goes down, their mortgage is so low, it still will be cheaper than selling it and moving somewhere with a lower loan, but the interest rate with go way up between 8%-10%. Because right now these homeowners have something that no longer exists: 2-4% interest rates. Those days aren’t returning. So they’re mortgage payments are *cheaper* right now than if they sold it. Even renting is higher than their 2-4% mortgage payment. It’s golden. If you sell that 2-4% interest rate mortgage for a smaller loan at 8-10%, your payment will GO UP. So, he concluded, you gotta live somewhere and you gotta PAY to live somewhere, might as well STAY in that LOW interest rate mortgage that nobody else can get now. That nonexistent low interest rate is an ASSET💰 because it’s saving you money.

Most of the people with the low mortgage rates are happy about their situation. Most of these videos don’t talk about the success stories and have encouraged people to wait and not buy. 2020-2022 was the last chance to buy at an affordable rate. I know someone who had the down payment and the income to buy in 2020. They decided to wait for a crash. Now they’re priced out. They have gave up on the idea of buying.

2.25% here. Problem is the apparently open ended insurance bill. It may eventually force me into one of my fixer rentals which is worth much less.

I’m always amazed how different the US housing market is compared to Australia. We intentionally rent out houses at less than the mortgage because we get tax breaks. So interesting to see you have lifetime mortgage rates where we have variable or fixed term (max 5 years). Mortgages with lifetime rates is not a thing here. Thanks for sharing.

Thank you for bringing awareness to the realities of homeownership and some of its traps. Not all a dream of peaches and cream. Do not follow the pack.

The rent is too damn high!

Don’t sell your soul Mike you’re doing a lot with the videos 👍

Yes, $3,500 a month is high, plus maintenance fees, taxes, etc. Bought an over valued home

May not need a home but I abhor ever-increasing rents. It would be fine if you could pay the same rent for at least a couple years but leases are never that long. They just keep raising rent prices at each lease renewal simply because they can.

Great advice. I do find it very challenging to properly estimate the expected taxes.

😅 problem is you're basing rent on today's over inflated rent prices. If you've rented homes as long as I have you'd know rent prices can go down alot quickly

NO COURSE - A HUGE part of your charm is that you don't sell anything. I would probably watch you any way, but I vote no for the course. With 124K subscribers, consults and your nationwide referral program, you probably make a good chunk of change. I'm ALL for capitalism and I know you work your tail off but think hard before you pull the trigger. I started as a real Realtor the same time that you did in upstate NY. As you know nothing was happening in the market in those years. So I decided to start buying my own investment properties (Port St. Lucie). Best decision of my life! Good luck to you! I'll be watching!

Glad you touched on the amount of houses for sale. I was shocked about the amount of inventory now; at least in Florida

I took a cash offer on my house I can't afford to maintain it and I'm done!!! Moving out of state and will rent for awhile. My interest rate was 2.4% but I'm done ✔️

I agree it's good to avoid an excessive mortgage as a general principle. But many do by falsely assuming that if they buy in a mid to higher end of town their value will not decline. In fact such properties can show the highest volatility. Rather, it's important to take into account the possible downsides like being able to lease out your property. OK. Easy to say. Because the uncertainties involved are daunting when tying to plan years into the future. With the best will in the world you can still make the wrong decision. Economists cannot even agree on what's happening in the next few months let alone years. This thinking encourages self-blame when in fact the ordinary punter is disadvantaged pretty continuously. For instance if the bottom falls out of the employment market then the ability to pay rent on higher-end properties reduces. Because it's discretionary so people start renting the lower end properties because they're trying to save to pay down debt and prepare in case of their own redundancy. If everyone is fearful at the same time then all your figures from when you first took out the mortgage become quite upset, even with the best planning. Because the reality is that what triggers the market is not widely understood and then when it happens is also not well known. If the Seattle guy delays he could be in for even greater losses. It's a wonder he doesn't just sell out now instead of waiting for the market to really start to collapse. Paralysis by analysis. Not good.

Rent it out at a loss and get some good tenants to get comfortable in the location. A small loss is better than a large loss.