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Jonathan Miller Predicts the Best Time to Buy

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Data and research from Mirror Samuel Co., Ltd.,real estate


Consultants power some of the largest real estate companies in the United States.

Over 30 years of experience in the real estate industry Co-founder Jonathan Miller There are various booms and bust cycles in the real estate market, and the recent boom is considered an “unbearable frenzy.”

“The market is fixed at 2.6% for 30 years. [mortgage rate]You create this insatiable demand and wipe out the supply, “Miller said. June 24, Master of Business PodcastsSponsored by Barry Resalts.

“And this has become the housing market for the bid war,” he added.

Now the enthusiastic market is coming to a halt 30-year mortgage rates rise to 5.7%, Inflation surges and geopolitical tensions remain. This creates a very different real estate market environment.

“One of the biggest enemies of the housing market is uncertainty,” Miller said. “And we certainly now have a basket full of it.”

According to Miller, the housing market began to slow around March of this year as inventories fell against the backdrop of already low levels of insatiable demand for two years.

“The Fed feels behind the party because we were able to see the nationwide inventory annihilation,” Miller said in a podcast.

Dan Morehead, founder and CEO of the $ 5 billion crypto hedge fund Pantera Capital, recently described the interest rate on this mortgage as follows: Intrinsically bold people don’t buy a home..

“When the Fed offers to lend 2.68% money to people to buy homes that are up 20% annually in leverage, they do! Not only homeowners but also investors.” Said Morehead.

Now, the slowdown is turning into an affordable issue, Miller said. One of the biggest uncertainties is inflation, which remains high despite recent rises in interest rates.

Inflation, combined with record-high real estate prices, is making the US real estate market increasingly affordable, causing a “significant recession” in demand, Miller said. The National Real Estate Agents Association Monthly Affordable Index It is at the lowest level in a few years.

“Nationwide, we expect a 20% rise in home prices and a doubling of interest rates, depending on the metrics you follow. What else could happen? It’s a slowdown,” Miller said. I did.

The slowdown is a view shared by Ken Shinoda, portfolio manager at the $ 122 billion bond shop DoubleLine, who told insiders that investors should expect. House prices will fall.

“Buyers know that the property isn’t moving that fast, so they’re taking a step back in hopes of lowering prices,” he said. Shinoda in an interview.. “Sellers will have to start cutting prices.”

However, some real estate analysts and strategists Prices are still rising in the face of rising interest rates, It shows strength in the market.

Miller considers this to be a delay in the data itself.

“The newly signed deal has already begun to cool in March, eventually leading to listings and eventually sales flattening or chilling,” Miller said. “I don’t think the price increase is the result of a change in the mix. I think it’s just a delay in the actual data itself.”

The market is chilling, but Miller said it will still take some time before it completely surrenders.

“I think most people are wrong in expecting prices to drop soon. In fact, it takes a year or two for sellers to surrender to market conditions.”

The seller may surrender sooner, Miller said. But he added that sellers generally don’t want to leave money on the table and feel they could sell at a higher price. Mirror’s experience during the period from market cooldown to significant price cuts is about one and a half to two years.

Based on this analysis, Miller agreed with Ritholtz that the time to buy contrarian would be the summer of 2023.

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