We've been talking about housing on this channel for a while now, okay, but today we really got to talk a little bit more about some of the things that have started a car back in january. We really talked a lot about how look when the 10-year treasure goes up. Hits three percent we're gon na see mortgage rates in the five to six percent range. This is what slowed down the housing market.

In 2018, the housing market lost 12 in the span of two months, once home buyers reacted now, today, things are a little different. We've got a lot of excess demand in the home buying market, and so what happens is when interest rates go up? One percent. We tend to see a reduction of 10 in purchase power. We know this is old math at this point.

We learn about this. Not only on the channel but of course in the programs on building your wealth with uh real estate and do-it-yourself property management and rental renovations uh, but we go much deeper than that and, for example, one of the things that we got to know is that if We have excess demand right now, 30 and interest rates go up three percent cool. Well now, maybe we have an equal level of supply and demand right. The question is, could we potentially overly compensate for excess demand end up with now more supply than demand, which leads prices to kind of start curving a little bit, and does that potentially lead to fear well 10-year treasury, right now sitting at a 2.97 percent? Moving back up on that neighborhood of 3, and on top of that, we just got a report here that uh in vancouver they're, now uh seeing evidence of a sharp decline uh in their housing market.

Now, usually, when we hear sharp decline like there are many different matrices that we can look at for uh, you know a steep, slow down or or whatever right, and what they're talking about is that seasonally adjusted home sales in april declines sharply by 22.8 compared to March, this is now the third monthly decrease in a row. The concern with this is that, if you're not selling as much inventory as you used to, you start basically building up inventory more, and that means you start getting into the direction of oversupply while at the same time as having higher interest rates, higher costs lower purchasing Power, there's really only one direction that prices go after that now. This is the third monthly decline that they've seen in the metro, vancouver housing market uh. Third, in a row uh and uh.

Now they see that, on the supply side, the number of properties listed for sale in april shot up 5.3 percent in march. That is now the fourth monthly increase and you're kind of seeing murmurings of that same thing happening throughout the country where now you're. Finally, starting to see housing supply kind of do do this, like the slow kind of s-curve ramp right and you're, getting the reverse, like the slow kind of s-curve to the downside, ramp of of price appreciation and sale. So those are things to keep in mind, uh and certainly they're, entirely likely to cross uh, but anyway, uh bloomberg is also - and this is the other thing that i've been talking about regularly - that you have to watch for.

Is it's not so much like? What's actually happening, that scares home buyers or whatever it's like literally, what are people saying on the internet right now? That could be totally wrong. It's entirely possible. The housing market soft lands. Fine, we have higher rates for a couple years, they'll come back down.

I widely expect rates to come back down. I think people are going to have a great opportunity to refinance down and they probably not financial advice shouldn't like pay money to get a higher or a lower interest rate. Just take the higher rate, take the credit and then refinance in the future, but now you've got bloomberg saying that in march a measure of u.s housing affordability fell to its lowest level. Since oh wonderful year to compare to 2008 housing is only getting less affordable.

Uh in the coming months, the fixed home buyer index fell to 124 in march from 134 the prior month, according to the association of realtors, with declines signaling that homes are becoming less affordable, that's no surprise, and then they go on to uh. To give some examples of how much it costs now uh for for an average 400 000 home versus not - and that's not so much important, what's really important - is that we know purchase power, declines 10 for every 1 that we see rates go up. So these are definitely things that we want to pay attention to in the housing market, mostly because that could also trickle over to the stock market. If we start seeing people's impression of wealth decline because their underlying assets have lost value, then they're less likely to spend.

Like loonies on travel or or you know, goods, and you know new refrigerators or solar panels or end phase inverters, i hate saying that. Okay, i hate saying that, because i love in face, but let me just tell you and i might be really early with it, but if people's home values are going down, i guarantee you days not putting all solar panels, at least not at the rate at which They they were previously right, like somebody's still gon na buy solar panels. It's not like these companies are gon na. Have their business go to zero uh, but but yeah expectations will be yeah anyway.

My thoughts, okay.