mmarshall

That's beginning to sound like Germany in the 1920s, when people had to take large containers of money to the corner-store for a loaf of bread.





I think part of the problem, today, is that, a lot of people have just gotten so burned out from overwork, low wages, pandemic-problems, having to look after kids, Day-care, etc.....that they are simply saying screw it, it's not worth the hassles anymore, and they are out of the labor-market.....time to retire and go play some golf. It's a lot easier, of course for those whose homes and vehicles are paid off.




Sometimes. That's why I try to co-ordinate my shopping needs when I am out.

Och

iTrader: (3)

Have you seen whats happening to electricity prices in Germany, all while their retarded government is closing nuclear and gas plants and touts the unsustainable green nonsense? These skyrocketing energy costs increase manufacturing costs, and will also reflect on car prices.

mmarshall

While I don't disagree, we probably can't discuss that here in detail because of the politics involved. I brought up the issue of baskets full of money in 1920s Germany in response to Steve's comment on managing to sell an (Originally) $19,000 house for $800,000. (and congratulations, Steve, on the sale...but I wouldn't want to be the new owner who signed the contract)

One thing that bumped up the value of a lot of housing in and near D.C. was when Jeff Bezos opened up his new Amazon HQ here in Arlington....which was perhaps not surprising, since he already owns the region's largest news-publication....the Washington Post.

Toys4RJill

Why not? Maybe the new owners have a good,job where they can afford it. The current inflation that the US is experiencing is not good for America as a whole IMO

SW17LS

If they can afford to retire, then good for them. Thats not a problem, why work if you don't have to work and have the resources not to? Others will come to take those jobs and the economy will move forward.

Exactly lol, thats what the house is worth today, $19,000 was what it was worth in 1965.

mmarshall

I suspect, though, that some are retiring even if they can't afford to. The job/commuting-stress, combined with home-responsibilities, are simply too much for them....particularly in this gridlocked region.

mmarshall

Depends on how much they were able to put down, and how much had to be mortgaged. As far as a good job, even if I was a Bank President or corporate CEO, I can think of a lot of things I'd rather have in life than mortgage-debt of over a half-million dollars, even if one didn't have to mortgage the entire amount (which a lot of lenders might not agree to in the first place).

SW17LS

People aren't retiring when they can't afford to, otherwise they would become homeless and destitute. What they have realized is that they are able to retire when they didn't think that they otherwise could, that they don't need as much to retire. The gig economy helps that too, there are a LOT of things people can do today to earn side money without traditional full time employment. Side businesses, consulting, copywriting, dog walking and pet sitting, small handyman jobs, Uber, delivery services...there are a LOT of things.

My cousin in WV has been doing Uber, and on the weekends in season he's making $250 a night, so $500 a week just for driving Friday and Saturday nights. Thats largely cash, under the table without much tax burden. He also found he can make another $250 a week delivering things during the week like groceries, food, alcohol, etc...when you figure he makes $35k from his traditional job GROSS, not net...you could see how he could decide he could quit his job and make ends meet in other ways.

The reason you see so many companies and restaurants and such struggling to find work is the workforce is discovering that they are better ways to make a living than working 40+ hours a week for low wage jobs. People aren't just throwing their hands up and saying "well I guess I'll go live in a box" The economy is evolving.

SW17LS

If you were a bank president or a corporate CEO making 7 figures plus, you would not care about having mortgage debt over $500k lol, trust me.

My mortgage is less than 10% of my gross monthly income, LOTS of people out there that can afford these homes and that's why their values hold. You're just looking at it through the lens of another era.

These are not extravagant homes either. My house is 3,800 square feet. I could buy a much, much more expensive home but it just doesn't have the value to me to do that.

mmarshall

Getting back to thread-topic (vehicles), not houses, some dealerships in my area seem willing, right now in December, to sell at MSRP without mark-ups. I suspect that may be because, during the holiday season, most shopping (not all) is for other gifts and merchandise. Even with the programs like the Annual Lexus Holiday December-to-Remember event (which seems like the same program every year), and the classic bow/wraps in the Lexus commercials, the average Christmas tree is not likely to have a new vehicle under it LOL. I think the real test will be in the middle of January, after everybody rushes back to the stores to exchange unwanted or unneeded gifts, and they start looking at new vehicles again. That will put some upward pressure on prices again....and, when Spring comes in March/April and the snows melt, even more vehicle shopping. I'm afraid that 2022 is going to be a classic year of Open One's Wallet.

SW17LS

Supply is improving too. This will settle down. Its all part and parcel of the same thing though. Lets look at what we have, we have record home sales, the highest home values EVER, which means people are paying more for homes than they ever have, we have record vehicle sales, and the highest vehicle prices EVER. What you're seeing is that people have the power to buy, and spending on a lot of other lifestyle things is way down. People aren't traveling like they were, they arent eating out like they were, they aren't buying clothes because they aren't going into offices, and they have more money to spend on homes and cars and this is the result of that.

For me, my income is way up and my spending is still way lower than it was pre-pandemic. I simply don't spend as much money in my monthly life as I did before...and a whole lot of people are in the same situation. So...we can buy cars and homes at their highest prices ever.

Toys4RJill

‘Who cares? I bought my condominium over 30 years ago in Toronto. I hung on to it all these years, I was single at the time as well..…now there are new young people/professionals moving in now….I truly have no idea how these people can afford to pay, and the reason is that their lives are so different than mine. On the flip side, as I am a director for my building, lots of people know me and when they find out what i originally paid for it, they simply can’t fathom it as they are half my age and their lives are so different….then the flip flip side…there old, old couples moving in here and there…why? Because they downside, the sell their home and keep 1/2 of the sale and the buy something far less and have a much more manageable place. My point is, there is something for someone out there…that person who sold at $800k did pretty good on something they paid $19k for…but maybe the new buyers are young and make $150k each…or perhaps it’s an older couple downsizing from their 1.5m home into something much more manageable or easy to live with as perhaps they are now empty nesters. I do believe that housing prices have jumped far too high..but it’s irrelevant to me at this point in my life.

SW17LS

The buyers paid $800k for it, tore it down and built a house worth about $2.8M. Combined incomes ~ $900k just off the top of my head I would have to go back and check the file. I think I recall he was some sort of cardiac surgeon and she was an attorney. Mid 40s.

What you're seeing now is older people are NOT downsizing, because the cost of the smaller properties is so expensive its cheaper for them to just stay where they are. Its one of the big reasons for the lack of inventory.

The same thing will happen with cars. An example, I'm paying $1,500 a month to lease my S560. Right now, LSs are over $2k a month, and a new S Class is like $2,700 a month. It would make zero sense for me to come to the end of my S560 lease, and have to get something much lesser to get to the same cost, so I would just buy my S560 out and keep it vs doing that.

Seriously right now to touch the lease payment on my S560 I would have to go to an E Class. No way...but I'm not going to pay twice as much as I was for the new version of the same car so what options am I left with? Unlike housing though cars are a renewable resource

Toys4RJill

There is always something for someone out there.

I just looked up the LS lease price. Holy cow $2300 for the LSh

mmarshall

Yes, that would explain a good part of it. Surgeons and lawyers both tend to earn way more than average. I remember the beautiful lakeside house my late-Uncle, a cancer-surgeon, had in the Ohio Snow-Belt. The steep driveway, which would be hopeless in many conditions, had a built-in pavement-heater....when the system worked properly, just flick a switch and Presto, snow and ice becomes wet pavement. Just the same, though, he had a FWD Olds Toronado (he was a GM fan, like me) and his wife, a nurse, had a 4WD Jeep Wagoneer.