What's up, graham, it's guys here so while the stock market was sneaking towards its record all-time high dogecoin was blowing past 40 cents and apple was unveiling a purple iphone that sent their stock price soaring a whopping .0038 percent. There was a topic that somehow got missed in the middle of all of that, and that would be the unbelievable housing market. That's now increased in price 17 year-over-year to put that into perspective. Housing is now at the highest price.

It's ever been in history. Two out of three homes receive multiple offers, and today the number of homes on the market reached its lowest level ever in history, with just one month worth of inventory. Before it's all gone. In fact, the entire market is so desperate for any structure with four walls and running water, that a fixer-upper in dc received 88 offers, with 76 of them being all cash and if you're wondering how much that sold for it was 70 higher than list price.

The market right now has literally turned itself into a feeding frenzy of buyers willing to pay whatever price they need to just to get themselves into a house, and even though there's a new proposal that aims to address the housing shortage, the question still remains: how much Higher can this go? How much longer can this go on for and if you're in the market, to buy a home right now? What could you do to get your offer accepted without having to pay 70 over asking, but really quick before we start? I got a quick message from the puppy bailey hold on one sec: hey guys, this is bailey. You know what i like more than chewing on iphone cords when you smash the like button for the youtube algorithm and dad says if this video gets 69 420 likes i'll, get extra, treats because i've been good and i've gone three days now without having an accident. In the house, oh, and also a big thank you to public for sponsoring this video, but more on that later. So, as far as where all of this begins most of us already know, the basics interest rates were lowered to help boost the economy that caused mortgage interest rates to drop and that allowed buyers to bid up the prices of homes while keeping their monthly payment.

The exact same, but what makes this one so unique is that it wasn't just mortgage rates which boosted home prices, but instead it was quite literally a perfect storm of occurrences happening all at once. Dialed all the way up to 11. see interest rates are just one component that will determine how much a home sells for the other component is inventory and when no one is willing to sell their home in the middle of a pandemic. That's when things get uncontrollable.

Initially, when the shutdowns went into effect, people pulled their homes off the market, with the expectation that they're going to be inside. For who knows how long? But when all these buyers started coming out of the woodwork when they saw that mortgage rates dropped 30 percent. That lack of inventory didn't change, in fact it just kept getting worse and with fewer and fewer sellers wanting to list their home combined with more and more buyers wanting to get in the market. Buyers had no other choice than to compete with each other for whatever was left on the market for sale and that thereby boosted prices.

The introduction of mortgage forbearance also temporarily stalled homeowners who otherwise would have sold, because now they have the option to pause their payments with no penalties or fees, and then they have the option to decide later, whether or not they want to sell and in a market. That's rapidly appreciating every single month, the seller decides not to list their home. The more money they're making in equity as the market continues going up. That then, caused another unusual side effect where even if a seller did sell their home right now for top dollar they're gon na be faced with another problem in terms of where would they move to and all the money they got from a sale would just go To the next person who they ended up buying a house from, although now today there's another reason why housing is continuing to go up and most likely it's not something you would expect right now, with all the demand for housing, property developers are on a mission to Build homes as quickly as they possibly can, but there's a problem.

They can't keep up with demand because they don't have enough materials to build from listen, forget everything. I told you about investing in the stock market or investing in the real estate market or buying up cryptocurrency, because lumper prices are up a whopping 200 percent year over year. Some analysts are actually calling for this to be the next housing crisis, but instead of being caused by a wave of mortgage defaults on non-performing loans. It's caused by a lack of lumber, increasing the cost to build a new home by an average of twenty four thousand dollars.

So what happened well in 2020, when the pandemic hit and people were recommended to stay indoors, the production of housing materials began to slow down that ended up, causing not only the price of lumber to skyrocket, but also every other material needed to go and build a House, like pvc, drywall, copper, pipe and wiring is up 25 to 40 percent year over year, and even items like garage, doors and insulation have gone up 10 to 25, with wait times of 16 weeks or more just to receive the product and to make matters. Even worse constraints and supply chains make it nearly impossible to be able to produce the amount of material needed to keep up with demand, which means, at least in the short term. The price of housing could remain unusually high and the increase in the cost of building usually winds up being passed on to you as the customer in the form of higher listing prices. But that then puts the risk back on the builder where, if the cost to build a home gets to the point where the profit margins are too slim because lumber is too high, then they'll simply just stop building houses which winds up further worsening the housing shortage.

However, as far as for how long this will last, for some analysts say that within about 18 months, things might return to a somewhat normal, which mind you is still a lot higher than where they were a year ago, but a lot better than where they are. Today, in addition to that, though, we also have a new plan from the biden administration to add more real estate to the market and create more affordable housing, and i got ta say when i looked it over. It was actually pretty interesting, but when it comes to this, when the free stock trading app public heard, i was making this video they wanted to step in and help, and so they've graciously decided to sponsor this video and give you a little something in the process. Just for hearing this out for those not aware public is an investing social network that allows you to buy and sell stocks for any amount of money while being able to share ideas with a community of like-minded investors.

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A totally free stock of tesla - i did something similar to this about a week ago and tyler hodgkin got it. So if you want to be the next tyler and potentially get a free stock of tesla, now worth well over, seven hundred dollars use the link down below in the description, and i look forward to seeing you on there now in terms of changing the real estate Market and easing affordability for buyers look no further than the new infrastructure package in its proposal to eliminate certain zoning requirements coming soon to an area near you, okay, but seriously. Here's what this plan entails. The plan would look to eliminate exclusionary zoning and harmful land use policies which include minimum lot sizes, mandatory parking requirements and prohibitions of multi-family housing in its place.

The zoning requirements would be restructured in such a way that takes into account the current housing shortage and the need to build more real estate in areas which otherwise would have been off limits now, because the federal government can't have direct control to mandate these changes. Instead, they would give individual cities a tax incentive who allow for less restrictive zoning. So not only would this proposal have to first pass, but individual cities would also have to adopt these policies as well in order for any of this to actually happen. The thinking behind this is that single family zoning is restrictive in the sense that you can't build any more homes within the same amount of space prices tend to increase and when we're in a housing shortage, the simplest solution would be to allow more units to be Built within the same parcel of land, however, the reality is from both the perspective of a real estate agent, real estate, investor and homeowner is that in large cities, much of the zoning requirement is completely dictated by parking where each unit is required to have a full Dedicated parking space, so if you want to build a 600 square foot apartment for example, you would also need to build 300 square feet for a parking space, and that then begs the question: where are you going to put it if you put it on ground level, That takes away from the space that a developer could build livable square footage if you put it below ground.

Well, that ends up costing you a lot of money so either way that has to be factored into the cost of building that gets passed on to you. As the customer there's also plenty of other requirements like a minimum lot size, a minimum amount of open planted space or a minimum amount of common space and all of a sudden, the cost of building 600 square feet turns into 1100 square feet when you're all done With it, that's why, right now, it doesn't make any sense for a developer to build anything other than a luxury unit, because there's so much outdated red tape that needs to be built instead, because that's the zoning requirement like a year ago when i bought my house In west la, i would have loved to have put a second story edition on the guest unit. But if i wanted to add any more square footage, i would have to have an additional parking space on site, which, unfortunately, i only have room for two cars, and so that didn't happen to me. That's just silly considering that i would be using this guest unit for myself as an office and how close it is to public transportation, but you know what it is.

What it is, i think, easing up on zoning could be a really good thing for cities experiencing a housing shortage, and i do think we need to update the zoning requirements to account for the present day reality that not everyone needs to have a car parked on Site, but as far as how this proposal is written, unfortunately, it might not be enough, since the infrastructure plan would take place over 10 years. It's probably not going to provide any immediate relief for housing and also because this gives a tax incentive. The wealthier cities, which are more likely to have a housing shortage to begin with, have very little reason to actually go for it because they don't need the money in the first place. So basically, the whole plan from my perspective, has very good intentions, but ultimately it might not have as big of an impact on the housing market as expected, but in terms of what you could do now about the housing market and where it's going from here.

These are my thoughts now. First, as far as how competitive the housing market is, it really depends on where you live and how many californians are moving there just kidding not really. According to redfin, out-of-state buyers came into austin texas, with 200 000 more in spending money than the local residents when it comes to buying a home, and yes, that's, of course, driving up prices. The market in boise, idaho also takes the lead.

As far as home. Appreciation is concerned having tripled in price over the last 10 years, and now it seems like the markets, which have the biggest influx of new buyers, seem to be on the east coast from vermont, maine, delaware, south carolina and so on. So if you find yourself as a buyer in today's market - and you want to know what on earth, you could do to buy a place without getting out bid, whether you're buying a place for yourself or as a first rental property, here's my best advice coming from Someone who sold well over 120 million dollars worth of real estate throughout my entire career first, if you want to be competitive, but you don't want to increase the price of your offer. You got to remove contingencies ahead of time to make it a slam.

Dunk deal for the seller like here's the reality of the situation, if you're competing with an all-cash offer, they don't have any loan or appraisal contingency. So unless you're willing to pay way more than they are, it makes it difficult to compete. But there is an alternative that i have used myself in the past when you get pre-qualified by a lender, make sure they have everything they need submitted to underwriting ahead of time. That way, you're going to know exactly what you could qualify for, what the interest rate is going to be and you'll otherwise be completely good to go just pending finding the right home.

If your lender, then, is willing to give you the assurance not to worry about it and that you got the loan and you qualify, then you could consider removing your loan and appraisal contingency, giving you the same advantages of an all-cash offer without actually being all cash. Now there are, of course, two risks with doing this, the first one being that you don't end up getting your loan, which i think is somewhat unlikely, given your lender already has everything ahead of time, but anything is possible and, second, you run the risk of the Property not appraising at its full value now. This is not something i see happening too often, but if it does happen, you'll have to come out of pocket to pay the difference. So this strategy can work really well in certain situations, but you'll have to do this at your own risk.

The second another strategy that almost no one does is to do your inspections ahead of time. That way, by the time you write an offer on the property. You know exactly what you're getting into how much work it needs and you'll be able to write that offer with no inspection contingency, which is something that pretty much no other buyer will do. Plus now you could even lower your offer, because you know how much it'll take to fix it now.

The biggest risk here is that you wind up doing all of these inspections, and then the seller doesn't take your offer, in which case you're out all the money. For the inspections and the other risk is that if you decide you need a second opinion and you want to get another inspector back, you can't use that as a way to back out of the deal, but a small workaround for this for entertainment purposes. Only is that anytime, a seller gives you a material disclosure through either a seller, property questionnaire or transfer disclosure statement. Technically, that does create another inspection contingency, where you have another one to four days to review and sign off, but again, you're gon na have to use that one at your own risk and don't take any of my advice without consulting for your own specific situation.

The third, you could also use what's called an escalation clause which says: you'll pay above the highest offer up to a certain amount. Now this one is starting to be a lot more common now that a lot of the properties are going up in multiple offers. But basically this clause allows you to put your best foot forward without having to pay the highest price you're willing to pay up front. It's kind of like how ebay works where you could submit your maximum offer and then ebay will increase your bid as needed until that amount.

The downside to this, however, is that some brokerages won't allow you to do an escalation clause because they feel it's unfair to the other buyers, and some buyers also worry that they're showing too much of their hand by writing down the maximum they're willing to pay for A property, but i got ta, say in the right circumstances: this one works. Well then, fourth, you could try to get on the seller's good side by including a really nice handwritten letter explaining who you are and how much you want to buy their house. Sometimes, adding in a personal touch throughout an emotional transaction could go a really long way and i've straight up seen sellers accept lower offers, just because they've really liked the buyer. In fifth, you could also offer what's called a free lease back which would allow the seller to live in the home for a specified period of time.

After closing, for free sometimes doing this could give you a big advantage, because now it gives the seller more time to move out and with that it'll give them a little bit less stress. The downside of doing this, of course, is that technically you're gon na have to pay all the expenses. While you don't get to live there, but buying the right property could certainly make your offer stand out and give the seller a little bit more time to move and six. You could also look for off-market deals that don't have any competition.

Now this one i got ta say is a little like finding a needle in a haystack, because not only do you need to find a seller who's willing to sell to you, but it's also got ta be at a price. That's somewhat reasonable to pay. So all the stars really need to align for this one to pan out, but if it does buying a home without competition, could save you a lot of money and really, at the end of the day, the current housing market is showing no signs of slowing down Anytime, soon, interest rates are estimated to stay low for another two years. It could take 18 months or longer for building materials to come down in price and until then, there's very much still a housing shortage.

Now, obviously, these conditions can't last forever and when there's such an imbalance between the number of buyers in the market and the number of homes for sale, the tide eventually has to change. But until then, if you're in the market for a home, my best advice is to be patient and only buy a home that you're willing to keep for the next five to ten years. That way, if the market does go down, it's not going to have an immediate impact on you, because in this current market, honestly anything can happen. Rising interest rates, more inventory and a change in policies could have an effect on pricing, but in the short term, if everything stays relatively the same, it could be another wild year for housing.

So with that said, you guys thank you so much for watching. I really appreciate it as always make sure to destroy the like button. Subscribe button and notification bell also feel free to add me on instagram, i posted pretty much daily. So if you want to be a part of it, there feel free to add me there.

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