How is this not a bubble ready to pop?

[Serious Conversation]

Originally Posted by Lincolnian

The RE market cannot remain univerally in the ozone layer. When the average house in many areas of New England is now near $500,000, and there is not an abundance of jobs nearby to support a mortgage on that home, it only leaves wealthy retired people, remote workers with good salaries, and those with gains from other homes and/or support from parents to purchase.

It is unsustainable as many of these areas have few first-time buyers or younger people to work the lower paying jobs in the community because they cannot find housing.

The corrections are starting in some areas. Florida is seeing it with properties showing price cuts and longer times on market. Insurance and condo regulations are a part of it, but interest rates, pullbacks on second home purchases, and affordability are big factors as well. Ironically, a place like Connecticut, which was traditionally generally viewed as a high home price area, is now more favorable than many southern locations when all factors are considered due to an abundance of well-paying jobs and relatively affordable home prices. Traditionally many residents of Connecticut fled to states such as Florida, North Carolina, South Carolina, and Tennessee and found similar-sized homes for as much as half the price of the home they sold. Now that is no longer true.

We are seeing signs of upward exhaustion not just in housing but in the stock market as well. Restaurant visits are down as well and car prices are dropping. In addition, the price of oil has broken $90 a barrel and is trending upward. When it cracks $100 it starts to put pressure on many sectors of the economy and prices at the pump.

A pullback in the housing market is warranted and needed for long-term stability. The high home prices only truly favor someone cashing out who doesn't need a place to live. For the majority of home buyers, the high home prices reduce negatively impact their cost of living.

I live in a CSA of about 500,000 in northeast TN, and some of the wealthier parts of the area are now seeing median sale prices of $500,000 or slightly more.

Keep in mind that median HHI in that county is about $55,000. Sure, wages have climbed at the bottom, but they're still poor to afford the housing. The top 10%, maybe 20%, are fine. It's the middle that has been killed by these run-ups.

I live in a townhome complex. They're all "tall skinnies," brick bases with mostly vinyl siding, with drive-under garages. ~1200 sq. ft with a ~550 sq. ft garage. I bought for $96k in 2019. Comps in this complex have sold for $180k-$190k within the last couple of months. There's absolutely no reason this place should be worth twice what I bought it for less than five years later. Nothing has fundamentally changed in the local economy.

I work remotely for a county government in western NC. My girlfriend lives about twenty minutes from where my office HQ is. Her adult kids live there, and I'm not moving in with them there, so I'm going to be living alone for the foreseeable future. Median home prices are now over $600,000. Being single with ~$85k income, I don't feel comfortable going over $275k or so.

I'm an hour and a half away and want to move closer. Part of the reason I want to move is because I am tired of the low end city I live in, and want something bigger and more affluent. I used to live in nice places. I'm tired of the drug-addicted small towns with nothing going on.

I wanted to move to Asheville, NC. There are twenty pieces of property, excluding land, for sale at $250k below that are not pending or contingent. The SFHs are all complete gut jobs, possibly teardowns. There are condos, but these are more "apartment style" than what I have - unit entrances in a common interior, no deck/patio, there are several units in what looks to be a converted hotel, etc.

None of this looks very appealing. Anything I would be happy with tends to get snapped up immediately. By the time that I get far enough away from Asheville that the prices drop some, I'd be just as well off in the best city in this area, Johnson City. That would at least put me about fifty minutes from my girlfriend's, an hour from the office, and I'd have better amenities than I'd have in my immediate local area.

I have to be within two hours of Asheville for my job. My only other real option is Greenville, SC. I'd move there if my girlfriend would not hound me about it. Most other cities within two hours are no better than Johnson City, and I'd also be paying state income taxes.

I'm semi-stuck. I'm priced out of where I want to be. Anything I buy is going to be a big jump in my mortgage payment. I'm tired of small town nowhere. There aren't many other options in that two hour circle.