Crazy Hot Housing Market

[catccc]

We made an offer and waived the mortgage contingency, but intended to get a mortgage after putting 20% down, about $100K.  We listed assets to show about $400K, and the seller asked us to disclose additional assets to prove we could pay cash if our financing fell through.  So we disclosed those assets.  Still getting a mortgage.  I wonder if the offer we beat will be told they lost to an all cash offer?

Earnest money was paid a day after the agreement of sale was signed.

[Jesstache]

Thank you.  This is what was recommended by our realtor as well.  She's on it and knows the market well.  The "coming soon" sign is officially up as of Thursday at noon.  Our realtor, by Friday morning had already received 4 calls and we live on a pretty out of the way street.   

We did allow one early showing yesterday to a family where they currently have a set of twins and the mother is due in one week with another set of twins (yikes) and they are set on our neighborhood but are unsure of how easily they will be able to view properties once the babies are born (no kidding!).  Even if they were to make an offer, they'd have to submit it in May with everyone else.

We did find out the house down the street listed at $685k pre-market and accepted offer is $775k with seller willing to pay $75k over appraisal.   They never went on the market officially.  Another house in our neighborhood sold last week, it did come on the market for a couple days at $770k and just closed at $805k.  It is 400 sqft smaller but is on a court and has solar. 

A couple more houses have popped up but man, you can tell people that would normally have trouble selling are trying to dump their terribly maintained places while they can.  For example, the master bathroom in one has plywood flooring with a strip of what remains of the previous wall to wall carpet and visible water stains on the plywood in the listing photos.  Listed at $650k.

Meanwhile, we continue to get a continuous stream of post cards, letters and text messages (?) from investors, realtors, and hopeful home buyers about our houses in OR and are we thinking of selling (no).

Update:  The couple with two sets of twins let it be known that "when the time comes for offers" they'd like to offer $830k or $35k over appraisal and if there are other offers they'd like a chance to "know what it's going to take".   It's crazy.  We'll see what happens once the house actually gets on the market in 2 weeks.

To close the loop on this, we decided to stick to the plan of putting the house on the market and then reviewing all offers after the deadline to submit.  We had 15 showings in like 3 days and ended up with 4 offers.  One was at list price of $795k, one was at $810k, one was at $820k, no loan or appraisal contingency, the last one was the initial $830k willing to pay $35k over appraisal.   We took the $820k offer.  It was "same as cash" and they did show they COULD pay cash but ended up getting a loan.  There was an appraisal but I don't know what it came in at because it didn't matter.  We thought hard about going with the $830k offer but a very similar stats house (same floor plan, with pool, nicely updated) down the street had sold about a month before ours for $775k (they sold off market) and it was risky (to us) to rely on the appraisal for the final sale price so we went with the sure thing.  Inspections came up with nothing we didn't disclose so the rest of the transaction went smoothly.  The thing that surprised me was they cut down the inspection period to 5 days (standard is like 14?) and had a 21 day close.  I was impressed that it all got done in that time frame.   They also gave us 2 weeks free rent back, but we only needed one.   

[jeromedawg]

Ok so the most popular/common rhetoric and explanation I keep hearing about why the current housing market frenzy *isn't* a bubble is probably this:
"lending standards are wayyy stricter than they were in 2008, and supply is constrained while demand is pent up, so we can't possibly be in a bubble"

Given that bubbles are more or less discovered in hindsight though, are there any other factors here we might be overlooking? Not trying to promote bearism here, just asking an honest question...hahahaha



Was just reading through this, https://www.investopedia.com/articles/stocks/10/5-steps-of-a-bubble.asp, and it seems regardless of specific conditions that we'd *think* would prevent a bubble from happening again, the general 'tried and true' rule of thumb is that there are still 5 stages of a bubble. Period. And it's hard to deny that the current housing market is feeling a lot like a bubble...

1. Displacement
A displacement occurs when investors get enamored by a new paradigm, such as an innovative new technology or interest rates that are historically low. A classic example of displacement is the decline in the federal funds rate from 6.5% in July 2000, to 1.2% in June 2003.2 Over this three-year period, the interest rate on 30-year fixed-rate mortgages fell by 2.5 percentage points to a then-historic low of 5.23%, sowing the seeds for the subsequent housing bubble.3

2. Boom
Prices rise slowly at first, following a displacement, but then gain momentum as more and more participants enter the market, setting the stage for the boom phase. During this phase, the asset in question attracts widespread media coverage. Fear of missing out on what could be a once-in-a-lifetime opportunity spurs more speculation, drawing an increasing number of investors and traders into the fold.

3. Euphoria
During this phase, caution is thrown to the wind, as asset prices skyrocket. Valuations reach extreme levels during this phase as new valuation measures and metrics are touted to justify the relentless rise, and the "greater fool" theory—the idea that no matter how prices go, there will always be a market of buyers willing to pay more—plays out everywhere.

For example, at the peak of the Japanese real estate bubble in 1989, prime office space in Tokyo sold for as much as $139,000 per square foot.4 Similarly, at the height of the Internet bubble in March 2000, the combined value of all technology stocks on the Nasdaq was higher than the GDP of most nations.5

4. Profit-Taking
In this phase, the smart money—heeding the warning signs that the bubble is about at its bursting point—starts selling positions and taking profits. But estimating the exact time when a bubble is due to collapse can be a difficult exercise because, as economist John Maynard Keynes put it, "the markets can stay irrational longer than you can stay solvent."

In Aug. 2007, for example, French bank BNP Paribas halted withdrawals from three investment funds with substantial exposure to U.S. subprime mortgages because it could not value their holdings.6 While this development initially rattled financial markets, it was brushed aside over the next couple of months, as global equity markets reached new highs. In retrospect, Paribas had the right idea, and this relatively minor event was indeed a warning sign of the turbulent times to come.

5. Panic
It only takes a relatively minor event to prick a bubble, but once it is pricked, the bubble cannot inflate again. In the panic stage, asset prices reverse course and descend as rapidly as they had ascended. Investors and speculators, faced with margin calls and plunging values of their holdings, now want to liquidate at any price. As supply overwhelms demand, asset prices slide sharply.

One of the most vivid examples of global panic in financial markets occurred in Oct. 2008, weeks after Lehman Brothers declared bankruptcy and Fannie Mae, Freddie Mac, and AIG almost collapsed. The S&P 500 plunged almost 17% that month, its ninth-worst monthly performance.7

I guess I should ask it another way:
Historically, are there any other instances similar (not the same) to the current housing market frenzy, where it *seemed* as though there was a crazy bubble but in reality it didn't turn out to be one at all?

[roomtempmayo]

Ok so the most popular/common rhetoric and explanation I keep hearing about why the current housing market frenzy *isn't* a bubble is probably this:
"lending standards are wayyy stricter than they were in 2008, and supply is constrained while demand is pent up, so we can't possibly be in a bubble"

Given that bubbles are more or less discovered in hindsight though, are there any other factors here we might be overlooking? Not trying to promote bearism here, just asking an honest question...hahahaha

Sure.  Inflation really takes hold, and the Fed raises rates to 5+%.  Sales volume would decline massively, and there would be some price discounting on what was sold.  Toss in a correction in the job market and equities simultaneously, and we could see lots of defaults and a price correction of 30-40% again.  But that hypothetical scenario is basically that all the bad things happen at once and there's no effective policy action in response.

I'd guess that the far more likely outcome is that rates rise moderately and everyone is locked into their 2-3% mortgages forever, with both the housing and job markets becoming sclerotic as everyone is frozen in place.

[jeromedawg]

Ok so the most popular/common rhetoric and explanation I keep hearing about why the current housing market frenzy *isn't* a bubble is probably this:
"lending standards are wayyy stricter than they were in 2008, and supply is constrained while demand is pent up, so we can't possibly be in a bubble"

Given that bubbles are more or less discovered in hindsight though, are there any other factors here we might be overlooking? Not trying to promote bearism here, just asking an honest question...hahahaha

Sure.  Inflation really takes hold, and the Fed raises rates to 5+%.  Sales volume would decline massively, and there would be some price discounting on what was sold.  Toss in a correction in the job market and equities simultaneously, and we could see lots of defaults and a price correction of 30-40% again.  But that hypothetical scenario is basically that all the bad things happen at once and there's no effective policy action in response.

I'd guess that the far more likely outcome is that rates rise moderately and everyone is locked into their 2-3% mortgages forever, with both the housing and job markets becoming sclerotic as everyone is frozen in place.

This is what one realtor I was talking to was thinking: we're going the route of Europe where everyone is going to end up owning the same home(s) for potentially generations... does this translate to "buy the best you can afford NOW" then ?

[roomtempmayo]

does this translate to "buy the best you can afford NOW" then ?

I don't think so. 

Don't forget that the possibility of a major price correction isn't zero, and even in the best case scenario you're locking yourself into a location (and high maintenance, maybe taxes) for the long haul.

It might translate into buying the housing you need for the next 10-20 years rather than the next 5 years, though.  However, you could likely build an addition or remodel if your needs outgrow whatever you buy now.

[jeromedawg]

does this translate to "buy the best you can afford NOW" then ?

I don't think so. 

Don't forget that the possibility of a major price correction isn't zero, and even in the best case scenario you're locking yourself into a location (and high maintenance, maybe taxes) for the long haul.

It might translate into buying the housing you need for the next 10-20 years rather than the next 5 years, though.  However, you could likely build an addition or remodel if your needs outgrow whatever you buy now.

True... might be good to continue waiting while looking for a "deal" relatively speaking. I was thinking about the possibility of thinking more of it as buying the lot for the land, and making the additions later if, say, we were to buy a 3/2 that happens to be on a larger lot with space to expand. The problem is the thought of how disruptive an extension like that could potentially be but I think it depends on the current layout and if there would be room for an "easy add" versus one that would be more prone to being super disruptive. By "disruptive" I mean: "not being able to use the kitchen for a number of weeks" or "having to move out and live elsewhere for an extended period of time" or something along those lines. Of course, I don't know enough about major home remodels/extensions to know if those are real issues. The closest thing I have heard/seen is the big remodel my brother/SIL did on their place where they basically gutted their entire living/dining/kitchen area downstairs and re-did a lot (opened up walls, other repairs, etc) but also had all the windows replaced in their home (which also involved upstairs). It was highly disruptive and they had to live there while the work was being done. Their kids are older in middle school and late elementary though, which perhaps in their case allows for more 'flexibility' - there's no way I'd want to deal with things like that in our current stage of life with a 5 and 4 year old and considering trying to expand the family to add one more...

[Dicey]

Thank you.  This is what was recommended by our realtor as well.  She's on it and knows the market well.  The "coming soon" sign is officially up as of Thursday at noon.  Our realtor, by Friday morning had already received 4 calls and we live on a pretty out of the way street.   

We did allow one early showing yesterday to a family where they currently have a set of twins and the mother is due in one week with another set of twins (yikes) and they are set on our neighborhood but are unsure of how easily they will be able to view properties once the babies are born (no kidding!).  Even if they were to make an offer, they'd have to submit it in May with everyone else.

We did find out the house down the street listed at $685k pre-market and accepted offer is $775k with seller willing to pay $75k over appraisal.   They never went on the market officially.  Another house in our neighborhood sold last week, it did come on the market for a couple days at $770k and just closed at $805k.  It is 400 sqft smaller but is on a court and has solar. 

A couple more houses have popped up but man, you can tell people that would normally have trouble selling are trying to dump their terribly maintained places while they can.  For example, the master bathroom in one has plywood flooring with a strip of what remains of the previous wall to wall carpet and visible water stains on the plywood in the listing photos.  Listed at $650k.

Meanwhile, we continue to get a continuous stream of post cards, letters and text messages (?) from investors, realtors, and hopeful home buyers about our houses in OR and are we thinking of selling (no).

Update:  The couple with two sets of twins let it be known that "when the time comes for offers" they'd like to offer $830k or $35k over appraisal and if there are other offers they'd like a chance to "know what it's going to take".   It's crazy.  We'll see what happens once the house actually gets on the market in 2 weeks.

To close the loop on this, we decided to stick to the plan of putting the house on the market and then reviewing all offers after the deadline to submit.  We had 15 showings in like 3 days and ended up with 4 offers.  One was at list price of $795k, one was at $810k, one was at $820k, no loan or appraisal contingency, the last one was the initial $830k willing to pay $35k over appraisal.   We took the $820k offer.  It was "same as cash" and they did show they COULD pay cash but ended up getting a loan.  There was an appraisal but I don't know what it came in at because it didn't matter.  We thought hard about going with the $830k offer but a very similar stats house (same floor plan, with pool, nicely updated) down the street had sold about a month before ours for $775k (they sold off market) and it was risky (to us) to rely on the appraisal for the final sale price so we went with the sure thing.  Inspections came up with nothing we didn't disclose so the rest of the transaction went smoothly.  The thing that surprised me was they cut down the inspection period to 5 days (standard is like 14?) and had a 21 day close.  I was impressed that it all got done in that time frame.   They also gave us 2 weeks free rent back, but we only needed one.

Aaah, I love a happy ending!

[Radagast]

Ok so the most popular/common rhetoric and explanation I keep hearing about why the current housing market frenzy *isn't* a bubble is probably this:
"lending standards are wayyy stricter than they were in 2008, and supply is constrained while demand is pent up, so we can't possibly be in a bubble"

Given that bubbles are more or less discovered in hindsight though, are there any other factors here we might be overlooking? Not trying to promote bearism here, just asking an honest question...hahahaha

I think we are in boom, but certainly not a bubble. Neither reason has to do with lending standards.

1) Fundamentals: TINA. Rents are also setting all time highs again and again (certainly locally). The cost to build a new house is definitely at an all time high. House building has not been matching demand for new houses over the last 15 years. There is just not enough of anything right now including rentals. Until TIAA, the high prices are justified. Once TIAA we might say there was a bubble, but I think I would still disagree. A boom/bust cycle is not the same as a bubble because it is driven by fundamentals, whereas bubbles are built on nothing but hot air. There might be hot air somewhere in the system, but it is not originating from the real estate sector.

2) There is no euphoria. Home buyers hate that they are buying homes at these prices. I know many people looking for homes and nobody likes the situation. They are definitely not buying multiple houses or more than they need, they are trying to buy anything. People are not buying with the intention of flipping to an even greater fool, they are buying to owner occupy. All the price support in the market is at the bottom, generally (locally at least) looking at houses a $100K more will get a lot more house for the money ... that is why we got a large house and rent out part of it: it gives a monthly payment lower than literally any SFR available, and much lower than the average apartment even after costs, but we actually have a really nice home.

[jeromedawg]

Ok so the most popular/common rhetoric and explanation I keep hearing about why the current housing market frenzy *isn't* a bubble is probably this:
"lending standards are wayyy stricter than they were in 2008, and supply is constrained while demand is pent up, so we can't possibly be in a bubble"

Given that bubbles are more or less discovered in hindsight though, are there any other factors here we might be overlooking? Not trying to promote bearism here, just asking an honest question...hahahaha

I think we are in boom, but certainly not a bubble. Neither reason has to do with lending standards.

1) Fundamentals: TINA. Rents are also setting all time highs again and again (certainly locally). The cost to build a new house is definitely at an all time high. House building has not been matching demand for new houses over the last 15 years. There is just not enough of anything right now including rentals. Until TIAA, the high prices are justified. Once TIAA we might say there was a bubble, but I think I would still disagree. A boom/bust cycle is not the same as a bubble because it is driven by fundamentals, whereas bubbles are built on nothing but hot air. There might be hot air somewhere in the system, but it is not originating from the real estate sector.

2) There is no euphoria. Home buyers hate that they are buying homes at these prices. I know many people looking for homes and nobody likes the situation. They are definitely not buying multiple houses or more than they need, they are trying to buy anything. People are not buying with the intention of flipping to an even greater fool, they are buying to owner occupy. All the price support in the market is at the bottom, generally (locally at least) looking at houses a $100K more will get a lot more house for the money ... that is why we got a large house and rent out part of it: it gives a monthly payment lower than literally any SFR available, and much lower than the average apartment even after costs, but we actually have a really nice home.

What is "TINA/TIAA"?

How would you explain the differentiation between a boom/bust vs bubble (not in terms of what it's driven or caused by but in terms of what the outcome [or fallout] is)?

In terms of euphoria, I would agree that buyers aren't happy about all this. But sellers sure are... but if anything, buyers are acting in pretty *extreme* desperation aren't they? Waiving all contingencies w/ cash offers then over half the time regretting those decisions?

Buying the larger house and renting out a room or two isn't such a bad idea... that might work for us if prices weren't so ridiculous right now.

[bacchi]

There Is No Alternative

When everyone is certain that we're not in a bubble is a sign that we might be in a bubble. "Fundamentals" change.

[jeromedawg]

There Is No Alternative

When everyone is certain that we're not in a bubble is a sign that we might be in a bubble. "Fundamentals" change.

I thought I read somewhere (or several places) that bubbles are the kinds of things that you find out about in hindsight when it's already too late. Sounds about right to me... I guess we won't know till we know haha

[Radagast]

What is "TINA/TIAA"?

How would you explain the differentiation between a boom/bust vs bubble (not in terms of what it's driven or caused by but in terms of what the outcome [or fallout] is)?

In terms of euphoria, I would agree that buyers aren't happy about all this. But sellers sure are... but if anything, buyers are acting in pretty *extreme* desperation aren't they? Waiving all contingencies w/ cash offers then over half the time regretting those decisions?

Buying the larger house and renting out a room or two isn't such a bad idea... that might work for us if prices weren't so ridiculous right now.

As above, There Is No Alternative, and There Is An Alternative (last one maybe not common usage) (sorry debated spelling that out but it didn't seem as fun)

In terms of effect, there is really no difference between a bust and a bubble pop. Presumably a bubble pops at a higher point, but the other half of the equation is how far it falls after. Given that a market can lose 20% as many times as it wants from either situation, there isn't much difference in practice.

There are some ways around a bubble. In the Tech Bubble while Schiller PE went to 44 and trailing 10-year inflation was under 3% US long term government bonds were yielding like 7%. Value stocks had been crushed for a decade. So there were great alternatives.

In the Housing Bubble, rents were quite reasonable the whole time, so using an early rent-vs-buy calculator before making a choice would have given much more satisfactory results than buying. So would have not buying more house than you could afford.

In the Nifty Fifty craze it is not so clear what the alternative would have been, as bonds and stocks were priced somewhat but not extremely high, and crashed together. Other options were not investable, or the average investor would not have been able to access any data to inform their choice. Harder to say that was a bubble, outside I guess the nifty fifty stocks.

IMO if sellers are happy and buyers are reluctant, that indicates downward pressure on prices by the participants. A bubble would be the other way around. Which is why I think prices are likely high for more fundamental reasons.

[roomtempmayo]

This is what one realtor I was talking to was thinking: we're going the route of Europe where everyone is going to end up owning the same home(s) for potentially generations...

I'm not sure Europe would be the closest analogy for an America that ends up fixed in place. 

We already have whole swaths of rural and especially Rust Belt America that's locked into their current location because of low housing costs.  It's a bad dynamic because as the distribution of economic opportunity changes, cheap housing acts as an anchor to keep people from moving to it.  As people are downwardly mobile, the political pressure mounts to lower property taxes so that people can hold onto their housing.  The downward spiral continues as all manner of public services are then gutted, reducing human capital, social capital, and any attractiveness to outside investment.

A world where people who are just trying to hang onto the status quo is nasty, nasty, and I'm concerned these low mortgage rates could be the basis for it spreading to previously-dynamic areas of the country.

[MrMoneySaver]

I don't understand how cheap housing is a factor there. To me it would seem that the lack of job prospects and lack of education would be the key factors. Not the affordable housing.

[chemistk]

I don't understand how cheap housing is a factor there. To me it would seem that the lack of job prospects and lack of education would be the key factors. Not the affordable housing.

But cheap housing keeps many from even being able to try their luck in a more economically viable area. A family of 4 making $46k a year in West Virginia with a house 'worth' $120k and/or renting a house at $800 a month just simply won't have the resources to move to another higher cost of living area, much less to do so without a job prospect lined up.

[Cranky]

I think that recent studies have shown that there is no longer a wage advantage to lower income workers in high COL areas, though. Housing expenses eat that up now.

[roomtempmayo]

I don't understand how cheap housing is a factor there. To me it would seem that the lack of job prospects and lack of education would be the key factors. Not the affordable housing.

Like @chemistk says, cheap housing and a lack of opportunity have a reciprocal relationship. 

@Cranky Yes, I've seen some of those studies.  And the extension of them is that even if someone is able to make some absolute economic gains by moving to a more dynamic area of the country, they almost certainly lose relative social standing.  $30k might make you middle class in a small midwestern town, but moving to a city and making $40k moves you from rural middle class (a status you probably don't think about) to urban underclass (a status you will definitely notice).  The incentives all point toward doubling down on your existing location.

My experience growing up in a tiny isolated town and then living in four or five of them for work is that the dynamic described above has gotten more and more toxic/hopeless over time as their political and social identities have now been defined in opposition to the parts of the country with opportunity.  It's not just that the grandparents and parents are stuck, it's that many of the kids don't move toward opportunity, and instead replicate their parents' lives with even fewer prospects.

I'm of the general position that social dynamism and churn are net positive forces, and that the alternative to mass movement and a willingness to change to find a better future is an embittered stasis that we see in lots of left behind areas of the country now.  A mortgage climate that heavily incentivizes staying put over moving seems likely to slow the movement of people.  That movement has been slowing for generations, and I'm not sure that as a society we can handle much less movement.

[FINate]

While I agree dynamism is good for the economy and the country, I don't think moving from a LCOL to a HCOL area to chase opportunity is necessarily the answer. One must have marketable skills to take advantage of the opportunity a HCOL area offers for this to make sense.

I grew up in an very HCOL area and I saw the opposite problem: lower income folks fighting paycheck to paycheck just to make ends meet, falling further behind as rent increases continued to outpace pay raises. As an example, Costco pays about the same regardless of location. Why pay San Jose, CA rent prices when you can make about the same in Reno and buy a house in nearby Sparks, NV for less than $400k?

[Cranky]

I remain unconvinced that concentrating population and economic development in a few very expensive areas generates an improved quality of life for many people. I think we need to encourage more regional development.

[Captain Cactus]

Warning:  public whining ahead.

So I've previously posted on this thread about how we've been saving up for a condo in a resort town in the White Mountains (New Hampshire).  Beyond our retirement and non-retirement accounts we've been saving over the years to get a place of our own. 

So this little town, pre-pandemic, would have condos sitting on the market for long periods.  They would eventually sell but it wasn't a "hot" market per se.  So then covid hits and the prices are just completely haywire and inventory is very low...the previously slow-moving inventory disappeared (bought up I presume) and over the last 12+ months as inventory slowly trickles in it gets snapped up right away. 

Some examples:
Condos that used to sit on the market for $180,000K are now priced at $336K...and they will likely sell for that.  A house that sold for around $450K in 2019 is now on the market for $1.2 million (probably won't sell for that, but the realtors are willing to try).  Condos that previously sold for $215K are now selling for $330K.

Super frustrating...just when we were getting within range of buying our own, the prices go up.  Will this ever end?  Will prices ever go back down again?  Or are they now anchored at the elevated price range?

[waltworks]

Someone fatfingered something, but I still thought this was pretty funny:
https://www.zillow.com/homedetails/10-Boulder-Creek-Ct-Danville-CA-94526/18438839_zpid/

Only $959,950,000 - a "Fabulous opportunity in Brookview!" that even has LVP flooring and plantation shutters!

-W

[clarkfan1979]

Warning:  public whining ahead.

So I've previously posted on this thread about how we've been saving up for a condo in a resort town in the White Mountains (New Hampshire).  Beyond our retirement and non-retirement accounts we've been saving over the years to get a place of our own. 

So this little town, pre-pandemic, would have condos sitting on the market for long periods.  They would eventually sell but it wasn't a "hot" market per se.  So then covid hits and the prices are just completely haywire and inventory is very low...the previously slow-moving inventory disappeared (bought up I presume) and over the last 12+ months as inventory slowly trickles in it gets snapped up right away. 

Some examples:
Condos that used to sit on the market for $180,000K are now priced at $336K...and they will likely sell for that.  A house that sold for around $450K in 2019 is now on the market for $1.2 million (probably won't sell for that, but the realtors are willing to try).  Condos that previously sold for $215K are now selling for $330K.

Super frustrating...just when we were getting within range of buying our own, the prices go up.  Will this ever end?  Will prices ever go back down again?  Or are they now anchored at the elevated price range?

I am also looking to buy a vacation rental in my regional mountains of Colorado. I'm looking in Park County about 30 minutes south of Breckenridge. A house that sold for 489K in September 2020 is now for sale for 699K with no improvements. Based on comps, it should sell for 699K, maybe more. This equates to a price increase of 43% over the past 12 months for the same exact thing with no improvements.

 

[fell-like-rain]

We're under contract right now for a 2/1 condo for around $550k (which is a fairly cheap unit for my area). Am I worried about prices dropping? Yeah, definitely. I don't know if a 2008-style drop seems likely, if only on the principle that every downturn tends to have its own reasons and patterns, but I could definitely see a long, slow drift downwards happening if interest rates go way up or there's a recession that hits white-collar workers hard.

On the other hand, our PITI + condo fees for a nice 2 bedroom is $100 more per month than we were paying for a crappy 1 bedroom rental. So our worst case is less "we're underwater and the loan is eating us alive" and more "we can't afford to move for 5 or 10 years but we're in a decent situation."

[Dicey]

Someone fatfingered something, but I still thought this was pretty funny:
https://www.zillow.com/homedetails/10-Boulder-Creek-Ct-Danville-CA-94526/18438839_zpid/

Only $959,950,000 - a "Fabulous opportunity in Brookview!" that even has LVP flooring and plantation shutters!

-W

Lol, the "mistake" was fixed the next day. it sold for $1,075,000 and closed in less than 2 weeks, which means cash buyer. It's a townhouse, with $350/month HOA fees. Sadly, its also relatively affordable for the area.