Turning the corner in the real estate market?

[Trapshooter1]

I believe current interest rates have made the current real estate market come down. I think we re seeing it already in some Highly tillable land sales. Instead of 16-20. It's still bringing 12-15. Which is a reduction. Not a huge reduction but a reduction none the less. (Yes there is going to be the one off 80 that brings 20+ because 2 well off neighbors wanted it)

The housing market has slowed as well, stuffs staying on the market for quite a bit longer, but is still selling. I truly believe if a person is patient with this thing over the next say 5 years there is going to be opportunities, to buy an undervalued property.( I personally like to buy when the properties have been on the market for quite some time)

(The monkey wrench in this whole deal will be if the economy starts to faulter headed into an election year, will the FED stay the course??) If they don't and they blink and cut rates. Hold on because if real estate money goes back to 3-4% stuff will explode.

 

[John Young]

This country is in trouble. Bidenomics is killing us. Property prices are way over inflated and are not safe from the trickle down effect that's coming. We as a country are in for a world of hurt. This coming recession isn't going to be a picnic. Debt in America is at all time highs and the defaulting is already starting. Land prices are going to take a pretty big hair cut along with everything else. Inflation and interest rates sure haven't helped. Your dreaming if you think interest rates are going to be cut anytime soon. Powell already said possibly another rate hike before years end and already considering several years before any rate cuts. The democrats want this country to suffer. Biden has done everything in his power to make sure it happens. Then add in the reality the WW3 is possibly on our door step and couldn't come at a worse time. This country was in much better shape as a whole before the last recession in '08 started. This is going to get pretty ugly and I firmly believe going into 2025 will be the heart of it. The realtors seem to be having a hard time accepting it listing these properties still for double the actual value. Setting false expectations for sellers and we are watching properties just sit now. Of course every seller thinks they are sitting on gold. Its the realtors job to bring them to reality. Not take the listing no matter what at the expense of trying to screw people and I am certain these realtors will be weeded out. People rarely forget when people or businesses are trying to screw people. Priced reduced signs are starting to show as well and they are still way over priced. You would be foolish and crazy to pay $6K+ an acre for land now. Especially timber and rec ground. If you do its like buying a stock you know is going to fail before you do it. I certainly wouldn't want to be instantly underwater and know that any improvements I make is throwing money away. Right now is a terrible time to buy land. because by 2025 I think we will see a good 40% haircut. It certainly remains to be seen but I firmly believe it. The days of naming your price are over and the tide is turning to a buyers market. I think frivolous money is just about nonexistent with interest rates the way they are. These are just my opinions on our country and land prices at the moment. What happens remains to be seen. But I do firmly believe people with out a good 2 year rainy day fund are in trouble. Which is most of America because its the American way to live a paycheck away from bankruptcy unfortunately.

 

[Hardwood11]

John.. I think you are on the right track . Crazy times! A 40% haircut ? Maybe ? Doubt it !

It will be location driven. Some areas won’t see much change, and others will !

Interest rate may drop as soon as next year , the pressure by the Government to lower will be intense. They can’t afford these rates either !

 

[John Young]

John.. I think you are on the right track . Crazy times! A 40% haircut ? Maybe ? Doubt it !

It will be location driven. Some areas won’t see much change, and others will !

Interest rate may drop as soon as next year , the pressure by the Government to lower will be intense. They can’t afford these rates either !

I have very high conviction that property prices will be dropping drastically. Houses and land. We are most likely in for another housing crisis, banks collapsing, bail outs and land isn't safe. The trickle down effect is going to hit everything. I think your underestimating how bad this recession is going to be. Powell doesn't care what the government wants. He was pretty firm on his stance at the last meeting. I would expect him to keep his word as he always does. He was point blank in saying we would most likely see another rate hike before years end and minimum 4 to 5 years before seeing any decreases. The rate hikes may not be done either. We could see another year of aggressive rate hikes next year too. The only concern Powell has is getting inflation back to 2%. In order to curb inflation he has to get the interest rate to or above the rate of inflation. So expect it. He even went as far as to say he needs the unemployment rate to go up. So he wants to put people out of work. Its a necessary evil to curb inflation. Not to mention he also has said on many occasions to be ready for a tough/hard landing. I am a guy that watches numbers/markets/ etc for a living. People better stop underestimating the power of the recession that's on our doorstep. Our country is in a really bad position right now heading into recession. Like I said earlier we were much better off as a country before the last recession. This one is going to be a lot worse.

 

[newfarmer]

Whats odd- around my area there is no ground for sale. Its literally being sold the day its listed. Houses are being sold the first day they are listed. The neighbors ground just went for 14,000/ac for 160.....I hope it turns around soon here, cause I am sitting in a reallll good spot to pounce on some ground

 

[Sligh1]

The “premium ground” in competitive areas that are prime tillable- they might hold strong. I’d say the strongest of any category. Much is paid for & its literally high yielding cash producing land.
MEDIOCRE dirt or mixed farms or rec farms on the other hand!!!!….. I tend to agree. I’d bet 51% to 49% that 20% corrections come. (It’s almost a 50/50 bet but I’m 1% over on betting it’ll happen). I may be dead wrong.

National financial collapse is actually a real possibility with interest on our >$30 trillion in debt. Stocks down, interest getting insane. Lower & middle class in deep trouble and getting deeper. Consumer debt increasing. Student loan repayments starting back up. WW3. Cities are collapsing from illegal invasion. Inflation still high. How we come out of this any less than “significant recession” is a mind boggler to me. I don’t think we do. Could it be 1930’s depression? WHY COULDN’T IT?!?! 1929 & again in late 1930’s. Same with late 1800’s depression (I think it was 1870’s or 1880’s). Easily could be as bad as 2008 & that regular land turned into major buyers market!!! Portion of sellers & speculators got totally wiped out.
Im the last guy “doom & gloom” & first to admit I’ve been dead wrong in last 3 years. Thought it was gonna go down before. I don’t see how we avoid it.

Bottom line: with good grain prices & still some
Massive cash in background, lessor quality ground went down about 2% in last 6 months. If things stay “the same” (no new problems) - I’d say it goes down another 3-5% in 6 months. So we at a 5-7% decrease right there. Add “anything” big in…. I can absolutely see 20%. I bet we see it. Could it be 50%?? It would take a depression like situation. Doubtful but possible. Am i personally scared of all this? NO!!! Am i cautious & prepared? YEP!!! My $, if betting, I say the “regular stuff” sees a 20% drop coming. Could be dead wrong but I agree & id lay $ on that way before laying $ on it only going down 5%.
Bidenomics are going really well btw!!!!! I can’t come up with 1 single thing that they could be doing a better job at. If I looked at approval ratings, has to be >95% approval of Biden/Harris- GOING REALLY WELL!!!!!!!!!

 

[Thinkin Rut]

If I felt strong enough financially, I wouldn't hesitate buying ground. How often can you buy the absolute low in any market? Never. Plenty of wiggle room right now and refi if the rates come down. Way more of a risk to get squeezed out of the market than to get sucked into the next great depression. Put the minimum down and if you find yourself in a soup line, let it go back. They can only prop Biden up for so long...he's done in a year. Even a dem with a backbone is better than we have now and should be able to navigate through the BS that these guys have left behind! JMO...TRUMP 2024

 

[IowaBowHunter1983]

I would welcome a 20-50% correction!

 

[John Young]

If I felt strong enough financially, I wouldn't hesitate buying ground. How often can you buy the absolute low in any market? Never. Plenty of wiggle room right now and refi if the rates come down. Way more of a risk to get squeezed out of the market than to get sucked into the next great depression. Put the minimum down and if you find yourself in a soup line, let it go back. They can only prop Biden up for so long...he's done in a year. Even a dem with a backbone is better than we have now and should be able to navigate through the BS that these guys have left behind! JMO...TRUMP 2024

What wiggle room? Lol… it’s like buying a stock at the top. You have no wiggle room. Put the minimum down and give it back when recession hits? I’m glad your not my financial advisor.


Sent from my iPhone using Tapatalk

 

[Slick]

3 years ago a guy could have bought 80 acres for $250,000. Hypothetically that 80 might look like 32 acres of 70 CRS and the remaining 48 acres in timber and creek bottom. The 32 acres might earn $9,000 in CRP payments. So ROI at about 3.6%...............fast forward 3 years and that 80 might get 500,000. There is definitely room for a 20% to 50% correction in the future. That's a huge increase in a short period of time. Time will tell......I was saying in 2022 that in 2023 a big correction would come......WRONG!

 

[John Young]

3 years ago a guy could have bought 80 acres for $250,000. Hypothetically that 80 might look like 32 acres of 70 CRS and the remaining 48 acres in timber and creek bottom. The 32 acres might earn $9,000 in CRP payments. So ROI at about 3.6%...............fast forward 3 years and that 80 might get 500,000. There is definitely room for a 20% to 50% correction in the future. That's a huge increase in a short period of time. Time will tell......I was saying in 2022 that in 2023 a big correction would come......WRONG!

It takes a good 18 to 24 months historically to feel the effects of monetary policy. They started raising rates around March of 22. So end of second quarter 24 before we should really start to feel the effects. Then they should progressively get worse at about the same rate as the rate increases. Then add in all the other bull going on. It’s certainly coming.


Sent from my iPhone using Tapatalk no

 

[Muskrat24]

There is a PILE of cash still in the system!!! The low income and middle class I am sure will get hurt out of this recession as it comes. Average farmers in my area netting $200 - $300 per acre again last year. We are 3-5 bad years of bad decisions and high purchases to work through the money most farmers have! And the non-farm wealth is full of cash even more. I’m like 1983, in the position to buy. 40% reduction I hope so. Houses and consumer debt on variable rates will hurt some along with student loan repayment but GENERALLY speaking these people aren’t the ones buying land. Haves and have nots, have nots will be HURT BAD financially!

 

[Windlooker]

Not saying anyone is wrong here, but I’ve bought and sold several pieces of property beginning in 1990, and if I listened to the bank, politicians, my dad, my neighbor etc I’d own zero today. I’m currently under agreement to buy a house and 20 ac in this shit show and will do it. Don’t hold your breathe waiting for rec ground to decrease. A small correction maybe but 40% is wishful thinking. Won’t happen. Rates low prices are high, rates high prices lower, cash is king. With cash it doesn’t matter what the rigged system does, and there’s plenty of it out there.

 

[Hardwood11]

It takes a good 18 to 24 months historically to feel the effects of monetary policy. They started raising rates around March of 22. So end of second quarter 24 before we should really start to feel the effects. Then they should progressively get worse at about the same rate as the rate increases. Then add in all the other bull going on. It’s certainly coming.


Sent from my iPhone using Tapatalk no

I remember a saying from a baseball card collector. He he had a bunch of valuable Mickey Mantle cards. A guy asked him what he would do if the card market lost 50%.

He said well I wouldn’t really have much time to think about as I’d be buying every Mantle card I could find !

Same would apply if every 5000/acre combo farm went to 2500/acre. I’d be focused on buying hand over fist !

 

[deerdown]

I've been waiting for the stock market to drop for 5 years.....and still waiting.... no one knows what's going to happen, we're all just guessing. Logic seems out the window anymore, at least my logic and assumptions....I sold a farm about 10 months ago and in retrospect, sold it too cheap, again, expecting the land market to drop.
Now, there are 2 farms coming up for auction near me and I think I'm a bidder for 1 of them, the question now is how to value it. I don't have to have it, but it's fairly close to the home farm and would be a great hunting farm and has income. Decisions, decisions......

 

[Thinkin Rut]

Posted by John Young Thursday in the shoot or pass thread...

Now if I am on my own private farm I am probably passing. Because there is a very good chance I get to see him next season. I would even buy land remotely close to state land. When I look at land for sale the first thing I do is go to ONX and make sure there isn't any close public land.

OK John...you're holding land on a high and you would even buy more land on a high. What happened to this very fragile economy we're in right now?? Are you sure you don't need me to be your financial advisor?

 

[John Young]

Posted by John Young Thursday in the shoot or pass thread...

Now if I am on my own private farm I am probably passing. Because there is a very good chance I get to see him next season. I would even buy land remotely close to state land. When I look at land for sale the first thing I do is go to ONX and make sure there isn't any close public land.

OK John...you're holding land on a high and you would even buy more land on a high. What happened to this very fragile economy we're in right now?? Are you sure you don't need me to be your financial advisor?

What’s that even mean? I sure as shit wouldn’t be buying land at this moment in time. But on private I’m definitely letting that buck walk. I’ve let plenty of 150’s walk on private. It’s not what I’m after. I’ve killed plenty in the 150 to 160 range. I’ve upped my game. But on state land I would shoot it with out a second thought. But I don’t hunt state land so it’s a non issue. But what deer you shoot has zip to do with the coming economy. But with your line of thinking I’m certainly glad your not my financial advisor. Putting up money to take on a 8% interest rate on just to own it until you lose it is throwing good money after bad. Buying land right now is like buying a stock at the top. Not a chance I would do either. But when I am looking at farms I look for three things before I would even consider going to look. Onx os your friend. The three things are no state land with in a few miles, not surrounded by a bunch of small properties(means too much hunting pressure) and no west access. I want several access points or anything but west/north west access. I’ve stuck with that and it’s never failed me for quality hunting. But certainly your hunting goals have nothing to do with the real estate market. Let alone the coming economy. Again another reason I wouldn’t want you as my financial advisor. Lol


Sent from my iPhone using Tapatalk mi

 

[Windlooker]

Sounds like paralysis by analysis to me. In every market and economic time there are pros and cons to buying, most will talk themselves out of a good purchase for fear of losing. Can’t be afraid to fail. It’s gonna happen. Go play. When I was a kid my parents bought a house with rates in the mid teens, had to buy, can’t live in a tent. Their long term financial situation worked out fine. While some are fearful I’ll buy if it’s a great property.

 

[John Young]

Sounds like paralysis by analysis to me. In every market and economic time there are pros and cons to buying, most will talk themselves out of a good purchase for fear of losing. Can’t be afraid to fail. It’s gonna happen. Go play. When I was a kid my parents bought a house with rates in the mid teens, had to buy, can’t live in a tent. Their long term financial situation worked out fine. While some are fearful I’ll buy if it’s a great property.

I certainly remember those days of interest rates in the teens. Hopefully we never see that again. I think the interest rate on my parents first house and my childhood home was 14%. But back then I think they bought the house for $37k. Lol! Now those homes are selling for $350k. Crazy how things have changed. You could buy a car under $10k. Now those cars are $60k+. Loaded trucks are $90k plus. You can’t hardly buy a house less than $300k and getting a car on credit is a $1200+ payment. The amount of people defaulting on cars right now is insane. I seen on fox business news that there aren’t no where near enough repo agents across the country to collect the vehicles that are in default right now. So people are driving these cars for free. But hell the payments are insane. Be ready for a bank collapse.


Sent from my iPhone using Tapatalk

 

[Thinkin Rut]

John...you are not thinking straight right now! List your ground first thing Monday morning. You wouldn't hold a stock on a high if you knew it was going down 40%. I'm sure you already sold your S&P at 4818! Pay your taxes, this is no joke. It's bad and only going to get worse. You know it and I know it. Sell all equities you have and convert to physical gold and silver. Good luck to you John, you are so blessed to have the knowledge to see through these murky waters!

If that doesn't convey the message I'm trying to send...You are entirely too negative, you are entirely too absolute, you are entirely too sure of yourself and your crystal ball is full of shit.