It is disturbing to me to see the Fed announce that a wind down of savings is a sign of a strong consumer. The average consumer is dipping into savings to make ends meet in a weak job market with increasing cost of living. That is the furthest thing from a sign of financial strength.
@@biz1boom Sounds like a weak labor market, not a weak job market. The only people hurting right now are the lazy and the dumb. In my 62 years I've never seen so much opportunity. Both my kids are making 6 figures straight out of college. All their friends are too. Everyone I know is making more money than ever. Wth are you people doing wrong?
Omfg! MYSTICFLIP turned out to be a bloody smart move. I love love love this. I’m the wrong side of 40 so I’m taking this all on board IMMEDIATELY- thank you! Even if I run out of time my kids will benefit from this incredible education. Thankyou thankyou thankyou!!
Since I've been out here driving a truck for 28 yrs i haven't seen freight slow down this bad. Even in 2008-2010. I really believe we're in for a great depression now. I'm glad my whole family is taking this seriously now. Buying long life foods, generators, gold and silver and everything else they need. I wish they would've started years ago like my wife and I did. Good luck everyone and pray for our world.
It's really important to get perspectives like that from people on the road literally shipping everything across the country. This is how we know things are not good.
LOL. It's funny when a "NORMAL" 5% interest rate happens and the entire country falls apart. Money has been waaay too cheap for waaay too long causing real estate to go way too high.
"Buy now, you can always refinance later"... this has become a huge issue with some corporate landlords as they were granted sweetheart deals from the fractional reserve banking system that allowed them to have short term-loans using long amortization tables to maximize short-term profits. Others did variable or interest only loans. Then when rates inevitably go up the landlords simply raise the rent, because in a tight housing market it's supply side economics. Banks are happy to make these loans because they know the landlord can always raise the rent and the tenants must always pay, or they will be replaced. The bank wins, the landlord wins, and the people at the bottom are squashed for their pound of flesh.
We are small mom and pop rental owners. We finances about 1/2 of what we bought the rental house cost. We payed 2% higher interest then a reg 1st mortgage. We were not ever offered by any lender an interest only loan, or low interest sweet deal. Now after 3 years hit with 15000. 00 street , water main and sewer upgrades. 6% interest charged added on to our taxes for the next 10 years if we don't pay it up front. Do we charge more rent? I think not. How is that fair to the renter? Taxes and insurance has gone up every year. It's not good for landlord or renters.
Wonder why HELOCs suddenly became popular again? People used to do cash-out refinances instead of HELOCs but these people now want to keep their 2.xx% interest on their existing balance and pay only the higher interest on the cash-out money. HELOCs only replaced the extremely popular cash-out refinances.
I remember the 2008 stock market crash. I was a wannabe day-trader at the time, so I was following the market closely. Although in retrospect everyone says the crash was caused by the "subprime lending crisis", the reality is that there was no "crisis" until the market sentiment changed and everyone wanted to cash-in on both their real estate and equities. THEN it became a crisis. Financial systems can remain "sustainable" right up until the moment they are no longer sustainable, and then everything changes at once. It took years to build-up the subprime mortgage house of cards, and like a ponzi scheme it kept growing until an unexpected downturn caused the whole thing to unravel.
Ah, I remember the great day trader boom. Seemed like some people I knew were buying on line courses, books and a new computer to get into doing it. I often wonder what happened to them, did they get rich...probably not. One guy I know now works for a brokerage, (not a big name one) and does okay. Much like the house flipping boom everyone seemed to be doing.
I understand all of this but I feel we live in a completely different world than 2008. Federal Reserve will not let the market crash, they will flush banks with cash and print endless amounts of money like they did in March 2020, resulting in like a 10 day crash and a huge reversal.
The real estate market did take down the economy, not the stock market. Once loans started defaulting, the banks failed and mbs were failing and were packaged up all around the world because the housing market was until that time, thought to be safe and stable.
Once one gets off the debt treadmill, your life changes dramatically. Not having a car you want but don't really need is the 1st step.I feel for those now just getting started as the market encourages subscriptions where you never own anything. When you add up monthly 'services' they are not insignificant.
What do they have a crystal Ball? Refi Later??? Really! Unbelievable!!! We in Sales used to say that was the SRO close! That Fairway is using that close technique. Standing Room Only Close! Get it before its gone! FOMO right?
Michael, Tell your viewers who may be wanting to buy a new construction from their local home builder, have them make sure the mortgage payment being given to them cover the full property taxes for the new construction and not just the tax on the undeveloped land. I have seen this happen with DR Horton homes where the Closing Disclosure is showing only partial payment for property taxes included. This would mean that the mortgage payment will jump by by around $350 for the increased taxes plus whatever they need to cover the escrow shortage. This looks like a bear trap being laid for new construction buyers to try to force a foreclosure so the construction company can take the house back and resell it to someone else.
Hey Michael, great video as always. Don't forget to stop by the US Open of Surfing in Huntington Beach. It started yesterday and is going on until August 6. Also, while in Orange County you might want to go to the OC Fair in Costa Mesa, great food and lots of fun rides.
The real buying power of the working class is only up like 40% from 30 years ago. Yes, wages have stagnated that hard. So much of this inflation is based on drowning the population in debt. it's insane.
When referencing corporate America, he said “They don’t really care about you as they make it seem” realest thing he said...I’ve seen experienced it first hand in the DMV. Black ppl aren’t really respected in corporate America. Glad that he was able to get out of there and become his own boss MYSTICFLIP
Black ppl aren’t respected in corporate America?? Not true as there are black individuals in charge of corporations as well. Has nothing to do with color. They don’t respect anyone below them. Same with the IRS or DMV…they believe they are better than you and just don’t care…whatever color you are.
Wow, a voice of reason in all of this chaos. Even my aunt, who I love dearly and lost everything in 2008 with multiple loans on houses, is back in realestate saying 'prices never go down' and trying to influence my wife and I to buy. Meanwhile, I look around and my gut tells me things are irrational and something is wrong. It's refreshing to hear someone who has been in real estate validate my thoughts.
That is what is wrong with Michael's channel. He holds the assumption that buying and selling things numerous times helps the economy out. It sort of does but not really. A healthy real estate market helps banks and realtors. Are you a loan officer or a real estate broker? Probably not.
Thanks for another great video. You get right to the point that a lot of people don’t want to hear. Our home is mortgage free and plan on staying here i. Florida. Not having a mortgage is helping us deal with our insurance costs. Our property taxes are still way less than what we paid in NY. My husband is partially handicapped and as myself, but I manage to upkeep the property. We just try to live a comfortable life. No need for 400,000+ home, and custom cars. We did have a camper and SUV but age caught up with them and had to be sold. I like camping but my husband insists no camper or towing vehicle if it involves financing. As Dave Ramsay states, “You don’t have the resources readily available, you can’t afford it.” We made our share of mistakes and learned. Now we need to keep the boat steering correctly. Michael or any viewers out there, are there any videos for the younger ones just going out into the REAL world? My son just turned 21 and I’d like him to watch something informative for his age. TY
I am thinking that a lot of people are interested buying older homes, because they are better made with more quality materials...at least in some instances. This is a nice area, Michael!
On an old home you have to replace the roof, furnace, a/c, plumbing system, electrical system, bathroom, kitchen, windows, repair foundation, etc. so there won’t be any “quality materials” left after you did the necessary repairs and updates.
That’s a very true statement! My friend bought a brand new house in 2017 and they’re replacing a new roof already due to severe leaks which is ridiculous not even six yrs
@@tiffanyh.5788 No, but I have seen plenty of well built older homes that hold up better than newer ones. Plus, I think that these days, a lot of newer homes are way over priced, and are very bland in design.
@@torsten6777 In some instanced...yes to plumbing and electrical, but depends on the builder and material. There is a great RUclips channel called "Our Restoration Nation," which showcases a lot of older, well built homes, though they also show some homes that are for sale and in disrepair and that need to be renovated. I guess it depends on if you want to take on that type of house and have the money to do what needs to be done, if you aren't able to do the work yourself.
Folks, listen to Michael, educate yourself and do not fall for this talk of buy now refinance later. Get out of debt as fast as you can, even if you have to work another job, buy a cheaper car 🚗 etc. Once you can manage your debt your stress will decrease and your options are far better than before. Pay off those credit cards!
Amen! And after all that start putting money in savings. Start small if you have to. It's not how much you put away to start with, it's about developing the habit and discipline. The light bulb will go on when your dishwasher or washing machine takes a turd and you actually have the money to pay for it in cash. it all makes sense then, at least it did for me. I absolutely hate not having savings
HELOC. They need money and know that they will be letting the home go after a while and why not get money now. People have been doing it for a year and they learned this tactic from the last crash.
Even the idea that the rates are going to drop is silly, the economic factors that allowed for those historically low rates no longer exist. Super low rates are not coming back and rates could even be heading higher.
@@utpharmboy2006 Can you explain it like I'm 5 then? Also please include links to your sources as well as a digital copy of your economics degree if applicable.
I’m waiting for 18-20% mortgages, so I can buy a house cash, and at a 40-50% discount. Most people will still not be able to afford a home after dropping by 40-50%, if rates are 18-20%. Those who are patient, and continue to save, will be rewarded. 💪
my examples are always from Healthcare point of view in southeast florida. last week another nurse was forced out her rental due to rate hikes and at 30 y/o forced back to her parents house. Another was offered room at another nurse home just so she wouldn't leave. Professionals will only tolerate these living situations for so long and it destroys recruitment for new staff. By spring next year salaries would have to increase 7-8% minimum to keep up with our regional inflation when accounting for housing, tax and insurance hikes just to keep minimum staff needs.
I hope you help vote out the big government county commissioners who force 14% from landlords as tax annual increases to pay for wishful spending. Nurses make more than most landlords and tend to want to help everyone. Unfortunately, voting to help everyone using other people's money (communism), hits landlords twice as hard as other property tax payers. The landlord was trying to provide someone a nice place to live with their life savings at risk. (Helping someone). Jack their taxes 14% continuously and you're forcing them to help everyone. An impossible task and not the basis upon which this country was founded.
The Fed has been financing this disaster since 2008. The markets have been trained like a duck that whenever things get bad the Fed will be there to throw more bread.
Thank you Mike for another great video, I’ll be looking forward to retiring in 4 years with a lakefront house in upstate NY paid off and wanting to buy a home in the Myrtle Beach area for CASH m. Please talk more about buying with cash and it’s advantages on a new construction or even an older home. Thank you and love your channel
My girlfriend lives In Columbia. I ask does she have a credit card. She said no. So I said get one. While I was there it came. Their rates are 30-60% its crazy how lucky the previous generations had it in America
I got a HELOC loan from PNC Bank a few years ago for home repairs and Michael's right about staying away from it.. the payments are about 250 a month on $24,000 and it's basically interest-only and then in 10 years it comes to do so who knows what after that.
I WORKED IN MORTGAGE SERVICING. CORRECT. 1ST 10 YEARS IS INTEREST ONLY UNLESS YOU TAKE THE INITIATIVE TO PAY ON PRINCIPLE. I HAD TO CALL PEOPLE WHO WERE APPROACHING THE 10 YEAR MARK, WHEN YOUR PAYMENT WILL NOW INCLUDE PRINCIPLE. I WAS CALLED ALL KINDS OF NAMES. OKEY DOKEY, CHECK YOUR PAPERWORK HAVE A GREAT DAY. I TOLD U SO
Maybe they have to charge that much because there are so many dead-beats that aren't paying their bloated credit card bills......call me old fashioned, but I don't think people should be able to file for bankruptcy and have their debts wiped.
The only problem buying a new house here in California is that they add a bunch of bonds on which makes it about 1.9% which on a 600k home is 12k a year plus the supplemental of about 6 k the second year.
I predict the work-from-home jobs that pay $100k or more will be farmed out to other workers in other countries that can and will do the same work for half the pay or less, so if you are working from home in your pj's and are making extraordinary money, and are being called back to the office, I would go back to the office.
We did get called back to the offices.infosec engineer making 275k. Remote work is mostly over for us that work in Financial Services , and yes I can do my job remotely and never need to go to the office, but they don’t care.
Problem is that there always seems to be someone ready to pay more for a house. In order to stop all the flippers out there is to require you own a home for a couple of years before you sell. Or you get penalized.
Michael.... History has taught us the economy crashes when no one wants the risk associated with lending (short or long term). For this economic cycle, it may be when one of the biggest national banks runs into trouble and finds trouble borrowing at the overnight window. Or it may be when one of our foreign partners declares they will no longer buy our treasury notes. This will scare the market badly.
Well that makes sense because automobile repos are increasing rapidly and people will absolutely max out their credit cards and HELOC to keep the vehicle because typically need that for work so the fact that they're getting repossessed means these people have maxed out there credit availability
Clear and straightforward to use, help function very useful. Also helps to know that there are humans in the background. No negative issues to report. Withdrawals are straightforward and not time consuming MYSTICFLIP
I've been watching videos of the people buying "new homes" and it seems like the quality has gone way down. I'd much rather buy an older home right night. Built much better from what I've seen. My dad was a contractor/carpenter and they really did a good job in his generation.
You are not buying a home! You are competing with each other to borrow a loan for a home! You are competing to pay high property tax and high property insurance for the next thirty years. 😂😂😂😂😂😂
No... 400,000 is waaaay too high.. Majority of Americans/buyers cannot afford anything above 250,000..And I won't pay that much.. I will stay where I am forever before I will pay outrageous prices.. Im hearing from buyers of new homes the quality is not good and they are having lots of issues with their new homes.. There will have to be a huge crash before I would consider buying..And I plan to keep the one I have now.. its pd for..
You are so right about debt and when the interests fall. There's a reason that interests will fall. And that usually means no one has money any longer.
"How about that bubble? That was kind of cool..." And that was a weird coincidence to me that I'm not sure you were concerned about. Maybe I'm reading too much into things - housing bubble, then you dodging that big old bubble there on the redondo beach boardwalk.
For those complaining about Feds raising interest rate. They've printed too much money and had low interests for years. If they dont raise the rate. Inflation will be worst
The news is factual. You are looking for a certain spin on the daily news to make it more palatable for you. Why not juist raise your standards a little so you are not scraping through the sewage filter for news?
"The government" is not going into debt. YOU (and me and every other taxpayer) are going into debt. The government is taking out a loan on future revenue. In a word, taxes. The only way that works out in the long run - especially in a rising interest rate scenario - is if taxes go up and/or government services get reduced to pay the interest and the principle on the loan. Deficit spending is the government spending your taxes before they even get it.
What sucks about new construction is that it’s mostly tract homes with even smaller lots than before. It’s about 6000 ft.² my area with no space between neighbors, the houses are small and very cookie-cutter looking they no longer come with RV parking or third our garage, etc. and they are farther from amenities…
I wouldn't be so quick to get all excited about buying a brand new home when you see so much shoddy construction these past few decades. Be very careful and do a lot of research before jumping into that market.
I agree. I just moved from Minnesota to Florida and have been looking at homes built after 2015. I was in the carpentry for a portion of my life and the first thing I noticed with a lot of these houses is how shoddy the trim work was. It's like they didn't even try to cut decent miter joints. If something so visible as trim looks bad, what does that say for the rest of the place, the stuff you can't see? One of the places was a flip and I looked at the tile job in the bathroom shower and it was terrible, so terrible that I would personally rip it out and do it over. Don't people take pride in their work anymore?
It is really sad to hear about the credit-card debt. With me, I sometimes use savings in order to pay off the credit card in full that particular month. I didn't know the credit cards had a debt limit. That is truly scary.
Another positive of the interest rate hikes is savers are finally getting a return on their money. My money market is now paying 5.21%. I cannot remember the last time I got a rate this good - probably in the 90s...
@@nickc3856 For Example -- Republic Bank of Chicago, 5.21% APY Digital Money Market Account. $2,500 to open account. Maintain a minimum $2,500 daily balance to avoid $25 monthly maintenance fee. Hope this helps you!
HELOC LOANS should be called HELL LOANS. Thank you Michael for sharing your thoughts and homework. Looks like you had a great walk today 😊. Blessings, Carlos ✝️🙏❤️😊🇺🇸
Interest rates are going higher before they go lower. The fed wants to break inflation and they are not there yet, inflation is going to tick up in the next few months.
I think you should look at the downtown area and the cost of a curbside tent or the accommodations under a bridge. Come to California the land of 1000 bridges
Hi Michael, I am glad you are enjoying the So Cal weather. My opinion on older homes is that you at least know what you are getting. It’s established so you know how folks are keeping their yards and houses, thus retaining their value. Don’t underestimate the value on established landscaping and large trees. In a cheaper newer subdivision you are rolling the dice as to who is sharing that neighborhood with you. I have seen those purchases go way wrong
@@basha0810 This is partly true. Fortunately I purchased a house in Florida with a new roof which was the big deal there. I do need to retrofit my wood trusses and either install new hurricane proof windows or shutters to get a discount on insurance. I also have to do little repairs all over the place but I just love the huge Oak tree lined streets and older landscaping new hoods don't provide. But if you can deal with bare streets new houses are nice, because they are brand new ;-)
My niece was buying new construction years ago. My brother/her Dad is an HVAC guy. Her brother does construction management. After those 2 “inspected” the house, the builder gave her money back and cancelled the contract. The builder didn’t want to fix the problems they found.
@@torsten6777 One A/C in a 2 story house in an area with hot humid summers where 2 A/Cs is standard and inconsistent air volume from all the vents in the house = unbalanced ductwork = Half-assed construction.
He probably saw the writing on the wall and just backed out. Nobody wants to hear from "Karen" two years after a sale. Demand is too high to fuss with people who are going to create problems.
@@trainsandlocomotives People said something similar in 2006 and 2007 as well. Don't think it can't happen, because we're overdue for it. Fed is keeping the economy propped up and looking good so Biden has something to campaign on in 2024, but make no mistake: whomever ends up in DC in 2024 will absolutely be dealing with one of the worst recessions in history, possibly even worse than 2008.
How do you refinance when you have no equity in your house? I've been down that road before. I don't wanna do it again. In fact this time there won't be HAMP to bail me out.
@@erikarommelit’s a fine game. If you completely pay it off, your credit doesn’t rise. But if you allow $10-50 to rollover, it increases your credit score as it shows you know how to manage money “responsibly.”
@@Mimlou It is very simple. Just have certain monthly payments like streaming services or maybe something like a storage locker put on your CC every month and pay the balance off monthly. You can even set up an automatic monthly payment from your bank account matching the payments you make on your CC. I haven't had significant debt, credit card or otherwise in over a decade and im in the 850s.
@@erikarommel So let's suppose you had several thousand dollars of CC debt, and you work hard and pay it all off. Yes, your credit score will jump because you were responsible and paid off your debt. But, let's suppose that you then swear off using CCs for a while. After a few months, you logon to check your credit scores and are flabbergasted to see your scores have actually dipped. What gives? Because you're not using credit, yes your scores will drop for non-utilization. I used to work at a major CC company (that also gave out personal loans) and I saw this all the time. People would pay off all their debt and get a nice fat 800+ score and then not do anything else for a long while, and then their scores would inevitably plummet and they would no longer qualify for our best offers etc. Then they would call in all pissed off and all I could tell them was "go check your credit report online for free" (even though I could see their credit scores I wasn't allowed to actually talk to them about why or anything, as an side this is absolutely "the system" looking out for itself before the people it's supposed to serve but I digress). Dave Ramsey said it best: What's the point of a credit score? To borrow money. Why? To borrow *more* money. Why? To borrow *more* money. Why? To borrow *more* money.
It is disturbing to me to see the Fed announce that a wind down of savings is a sign of a strong consumer. The average consumer is dipping into savings to make ends meet in a weak job market with increasing cost of living. That is the furthest thing from a sign of financial strength.
Just shows you that these people do not live or even have visited our world.
If this is a weak job market for you, then I guess you’ll never see anything more than weak
@torsten6777 It is a weak jobs market. Yes, there are jobs available, but most people do not want to work 2-3 jobs just to make ends meet.
@@biz1boom Sounds like a weak labor market, not a weak job market. The only people hurting right now are the lazy and the dumb. In my 62 years I've never seen so much opportunity. Both my kids are making 6 figures straight out of college. All their friends are too. Everyone I know is making more money than ever. Wth are you people doing wrong?
@@FooFan-b3ksitting on Twitter and RUclips looking for easy street… that’s what they’re doing. This generation is something else
Omfg! MYSTICFLIP turned out to be a bloody smart move. I love love love this. I’m the wrong side of 40 so I’m taking this all on board IMMEDIATELY- thank you! Even if I run out of time my kids will benefit from this incredible education. Thankyou thankyou thankyou!!
OMG CYBI?
Since I've been out here driving a truck for 28 yrs i haven't seen freight slow down this bad. Even in 2008-2010. I really believe we're in for a great depression now. I'm glad my whole family is taking this seriously now. Buying long life foods, generators, gold and silver and everything else they need. I wish they would've started years ago like my wife and I did. Good luck everyone and pray for our world.
It's really important to get perspectives like that from people on the road literally shipping everything across the country. This is how we know things are not good.
My brother is an otr trucker and he can’t take a week off for vacation because there’s so much freight that needs to be moved but not enough workers.
Bordenaro is the man. He's not a crash bro. He's not a blind bull. He just breaks it down, the best he can, with a positive attitude.
Crash bro is funny, I don't care what anyone says.
@@mrwilliamwonder It is a funny name tbh. I feel like it had to be targeted at michael first lol
@@SilverCpa
I was just down in the beach city today! Very nice place to be
We've entered the era of DGAF economics. The government first. Then Corporations. Banks. And now individuals
They’re advertising online all the time to borrow against your home
Yellow Trucking just filed for bankruptcy and laid off 30,000 people. That's about 600 people in each state. Devastating.
It’s like student loans. They want you to be in debt for life.
I think that bubble symbolized the housing market bubble😂😂😂😂
LOL. It's funny when a "NORMAL" 5% interest rate happens and the entire country falls apart.
Money has been waaay too cheap for waaay too long causing real estate to go way too high.
WOW! the pier is so nice, and the Pacific.. beautiful. The message was very insightful, thanks!
There's a catastrophic drought watch for the southwest US for the next few years. Builders should just stop and start the exodus from those areas.
Real Estate should all have to be Owner Occupied by law. That would eliminate high housing prices .
"Buy now, you can always refinance later"... this has become a huge issue with some corporate landlords as they were granted sweetheart deals from the fractional reserve banking system that allowed them to have short term-loans using long amortization tables to maximize short-term profits. Others did variable or interest only loans. Then when rates inevitably go up the landlords simply raise the rent, because in a tight housing market it's supply side economics. Banks are happy to make these loans because they know the landlord can always raise the rent and the tenants must always pay, or they will be replaced. The bank wins, the landlord wins, and the people at the bottom are squashed for their pound of flesh.
Shylock is ruthless! I have a renter and I'm criticized for charging only $275/mo. for a 2br...but WWJD?
Only until rent exceeds house payments. Then people buy.
We are small mom and pop rental owners. We finances about 1/2 of what we bought the rental house cost. We payed 2% higher interest then a reg 1st mortgage. We were not ever offered by any lender an interest only loan, or low interest sweet deal. Now after 3 years hit with 15000. 00 street , water main and sewer upgrades. 6% interest charged added on to our taxes for the next 10 years if we don't pay it up front. Do we charge more rent? I think not. How is that fair to the renter? Taxes and insurance has gone up every year. It's not good for landlord or renters.
Wonder why HELOCs suddenly became popular again? People used to do cash-out refinances instead of HELOCs but these people now want to keep their 2.xx% interest on their existing balance and pay only the higher interest on the cash-out money. HELOCs only replaced the extremely popular cash-out refinances.
That's Deal money for me and easy to get BUT 8.6% IF I use any was TWO Fixed..😁
Answered your own question! Great job
If you have time, visit Dana Point harbor, down in orange county.
You have to cut your spending DRASTICALLY to stay solvent. Michael is right. Get rid of credit card debt, car payments and spend LESS.
Have you noticed how expensive everything is in Cal
It feels like the Dylan song: "Everything Is Broken"
I remember the 2008 stock market crash. I was a wannabe day-trader at the time, so I was following the market closely. Although in retrospect everyone says the crash was caused by the "subprime lending crisis", the reality is that there was no "crisis" until the market sentiment changed and everyone wanted to cash-in on both their real estate and equities. THEN it became a crisis. Financial systems can remain "sustainable" right up until the moment they are no longer sustainable, and then everything changes at once. It took years to build-up the subprime mortgage house of cards, and like a ponzi scheme it kept growing until an unexpected downturn caused the whole thing to unravel.
yes. spot on
This. They're bubbles for a reason, when they pop it's sudden and quick, but the housing market takes a long time to reach bottom
Ah, I remember the great day trader boom. Seemed like some people I knew were buying on line courses, books and a new computer to get into doing it. I often wonder what happened to them, did they get rich...probably not. One guy I know now works for a brokerage, (not a big name one) and does okay. Much like the house flipping boom everyone seemed to be doing.
I understand all of this but I feel we live in a completely different world than 2008. Federal Reserve will not let the market crash, they will flush banks with cash and print endless amounts of money like they did in March 2020, resulting in like a 10 day crash and a huge reversal.
The real estate market did take down the economy, not the stock market. Once loans started defaulting, the banks failed and mbs were failing and were packaged up all around the world because the housing market was until that time, thought to be safe and stable.
Once one gets off the debt treadmill, your life changes dramatically. Not having a car you want but don't really need is the 1st step.I feel for those now just getting started as the market encourages subscriptions where you never own anything. When you add up monthly 'services' they are not insignificant.
agree with you on that leg go of the car BS .. paid off ... just added up my subscriptions etc .. was shocked ..
Everyone just spends recklessly.its their own undoing
What do they have a crystal Ball? Refi Later??? Really! Unbelievable!!! We in Sales used to say that was the SRO close! That Fairway is using that close technique. Standing Room Only Close! Get it before its gone! FOMO right?
Michael,
Tell your viewers who may be wanting to buy a new construction from their local home builder, have them make sure the mortgage payment being given to them cover the full property taxes for the new construction and not just the tax on the undeveloped land. I have seen this happen with DR Horton homes where the Closing Disclosure is showing only partial payment for property taxes included. This would mean that the mortgage payment will jump by by around $350 for the increased taxes plus whatever they need to cover the escrow shortage. This looks like a bear trap being laid for new construction buyers to try to force a foreclosure so the construction company can take the house back and resell it to someone else.
Hey Michael, great video as always. Don't forget to stop by the US Open of Surfing in Huntington Beach. It started yesterday and is going on until August 6. Also, while in Orange County you might want to go to the OC Fair in Costa Mesa, great food and lots of fun rides.
Hiiii!!!🤗
Is it every day or weekends only?
@@Lisithedogwalker The US Open of Surfing is every day until August 6. The OC Fair is Wed to Sundays.
@@willystalla Cool!!😉
I will check if Mike will be in the mood for it.😅
He hates crowds!😂🤪🤣
The Redondo Beach pier is great. They used to have the best old school arcade. It is a must to visit.
The real buying power of the working class is only up like 40% from 30 years ago. Yes, wages have stagnated that hard.
So much of this inflation is based on drowning the population in debt. it's insane.
When referencing corporate America, he said “They don’t really care about you as they make it seem” realest thing he said...I’ve seen experienced it first hand in the DMV. Black ppl aren’t really respected in corporate America. Glad that he was able to get out of there and become his own boss MYSTICFLIP
Black ppl aren’t respected in corporate America?? Not true as there are black individuals in charge of corporations as well. Has nothing to do with color. They don’t respect anyone below them. Same with the IRS or DMV…they believe they are better than you and just don’t care…whatever color you are.
Wow, a voice of reason in all of this chaos. Even my aunt, who I love dearly and lost everything in 2008 with multiple loans on houses, is back in realestate saying 'prices never go down' and trying to influence my wife and I to buy. Meanwhile, I look around and my gut tells me things are irrational and something is wrong. It's refreshing to hear someone who has been in real estate validate my thoughts.
That is what is wrong with Michael's channel. He holds the assumption that buying and selling things numerous times helps the economy out. It sort of does but not really. A healthy real estate market helps banks and realtors. Are you a loan officer or a real estate broker? Probably not.
Like the water temps in Florida being 100 and the perfect storm approaching the economy Kaboom Michael
The banks like making those exhorbitant fees!
Thanks for another great video. You get right to the point that a lot of people don’t want to hear. Our home is mortgage free and plan on staying here i. Florida. Not having a mortgage is helping us deal with our insurance costs. Our property taxes are still way less than what we paid in NY. My husband is partially handicapped and as myself, but I manage to upkeep the property. We just try to live a comfortable life. No need for 400,000+ home, and custom cars. We did have a camper and SUV but age caught up with them and had to be sold. I like camping but my husband insists no camper or towing vehicle if it involves financing. As Dave Ramsay states, “You don’t have the resources readily available, you can’t afford it.” We made our share of mistakes and learned. Now we need to keep the boat steering correctly. Michael or any viewers out there, are there any videos for the younger ones just going out into the REAL world? My son just turned 21 and I’d like him to watch something informative for his age. TY
I am thinking that a lot of people are interested buying older homes, because they are better made with more quality materials...at least in some instances. This is a nice area, Michael!
On an old home you have to replace the roof, furnace, a/c, plumbing system, electrical system, bathroom, kitchen, windows, repair foundation, etc. so there won’t be any “quality materials” left after you did the necessary repairs and updates.
Older homes don't last forever.
That’s a very true statement! My friend bought a brand new house in 2017 and they’re replacing a new roof already due to severe leaks which is ridiculous not even six yrs
@@tiffanyh.5788 No, but I have seen plenty of well built older homes that hold up better than newer ones. Plus, I think that these days, a lot of newer homes are way over priced, and are very bland in design.
@@torsten6777 In some instanced...yes to plumbing and electrical, but depends on the builder and material. There is a great RUclips channel called "Our Restoration Nation," which showcases a lot of older, well built homes, though they also show some homes that are for sale and in disrepair and that need to be renovated. I guess it depends on if you want to take on that type of house and have the money to do what needs to be done, if you aren't able to do the work yourself.
Excellent Video Michael, Thank You!
You need to visit Northern California. Totally different world
Folks, listen to Michael, educate yourself and do not fall for this talk of buy now refinance later. Get out of debt as fast as you can, even if you have to work another job, buy a cheaper car 🚗 etc. Once you can manage your debt your stress will decrease and your options are far better than before.
Pay off those credit cards!
Amen! And after all that start putting money in savings. Start small if you have to. It's not how much you put away to start with, it's about developing the habit and discipline. The light bulb will go on when your dishwasher or washing machine takes a turd and you actually have the money to pay for it in cash.
it all makes sense then, at least it did for me. I absolutely hate not having savings
Better yet, don't obtain one!
@@fredrickhaemker8434
Amen! To that.
HELOC. They need money and know that they will be letting the home go after a while and why not get money now. People have been doing it for a year and they learned this tactic from the last crash.
Thank you for making these videos.
Even the idea that the rates are going to drop is silly, the economic factors that allowed for those historically low rates no longer exist. Super low rates are not coming back and rates could even be heading higher.
you clearly know 0 about the world's monetary system
@@utpharmboy2006 Can you explain it like I'm 5 then? Also please include links to your sources as well as a digital copy of your economics degree if applicable.
I’m waiting for 18-20% mortgages, so I can buy a house cash, and at a 40-50% discount. Most people will still not be able to afford a home after dropping by 40-50%, if rates are 18-20%. Those who are patient, and continue to save, will be rewarded. 💪
12% next year.
@@fgjf1079 18-20%??? 🙄you would be better off finding doc brown to help you build a time machine out of a delorian to take you back to 1985
my examples are always from Healthcare point of view in southeast florida. last week another nurse was forced out her rental due to rate hikes and at 30 y/o forced back to her parents house. Another was offered room at another nurse home just so she wouldn't leave. Professionals will only tolerate these living situations for so long and it destroys recruitment for new staff. By spring next year salaries would have to increase 7-8% minimum to keep up with our regional inflation when accounting for housing, tax and insurance hikes just to keep minimum staff needs.
I hope you help vote out the big government county commissioners who force 14% from landlords as tax annual increases to pay for wishful spending. Nurses make more than most landlords and tend to want to help everyone. Unfortunately, voting to help everyone using other people's money (communism), hits landlords twice as hard as other property tax payers. The landlord was trying to provide someone a nice place to live with their life savings at risk. (Helping someone). Jack their taxes 14% continuously and you're forcing them to help everyone. An impossible task and not the basis upon which this country was founded.
The Fed has been financing this disaster since 2008. The markets have been trained like a duck that whenever things get bad the Fed will be there to throw more bread.
Thank you Mike for another great video, I’ll be looking forward to retiring in 4 years with a lakefront house in upstate NY paid off and wanting to buy a home in the Myrtle Beach area for CASH m. Please talk more about buying with cash and it’s advantages on a new construction or even an older home. Thank you and love your channel
Debt based systems need a lot of debt. The primary purpose of a house is to serve a collateral for the banksters.
My girlfriend lives In Columbia.
I ask does she have a credit card. She said no. So I said get one. While I was there it came.
Their rates are 30-60% its crazy how lucky the previous generations had it in America
Central Florida doesn’t have low housing inventory. I drive a lot for my job lots of new construction and older homes for sale.
The best show with the best setting and information
I got a HELOC loan from PNC Bank a few years ago for home repairs and Michael's right about staying away from it.. the payments are about 250 a month on $24,000 and it's basically interest-only and then in 10 years it comes to do so who knows what after that.
Would never buy a home with HELOC loan . 30 year fixed stable , you can pay more $$$$ towards it (monthly ) if you are able to afford it.
@@debbiec6216he probably has a mortgage too.
HELOCs are the worse. They should be required to call them what they used to be, a second mortgage.
I WORKED IN MORTGAGE SERVICING. CORRECT. 1ST 10 YEARS IS INTEREST ONLY UNLESS YOU TAKE THE INITIATIVE TO PAY ON PRINCIPLE. I HAD TO CALL PEOPLE WHO WERE APPROACHING THE 10 YEAR MARK, WHEN YOUR PAYMENT WILL NOW INCLUDE PRINCIPLE. I WAS CALLED ALL KINDS OF NAMES. OKEY DOKEY, CHECK YOUR PAPERWORK HAVE A GREAT DAY. I TOLD U SO
PEOPLE USE THAT $ TO GO TO HAWAII & DONT REALIZE THEY ARE ONLY PAYING INTEREST @@debbiec6216
Credit cards are now charging 27.99%- 29.99%
Maybe they have to charge that much because there are so many dead-beats that aren't paying their bloated credit card bills......call me old fashioned, but I don't think people should be able to file for bankruptcy and have their debts wiped.
I don’t see homes dropping in price like you say
Thanks Mich
Home values have been declining in Florida for months.
Same in Virginia
I wish everyone an wonderful Weekend ☺️
Right back at you!🩷☀️☺️🙏
A beautiful day in the neighborhood!
We're talking wall street vs main street... very complex
The only problem buying a new house here in California is that they add a bunch of bonds on which makes it about 1.9% which on a 600k home is 12k a year plus the supplemental of about 6 k the second year.
I learned my lesson from 2006, the Great Recession. Wait 2-3 years or regret for the next 15 years of your life.😮
I predict the work-from-home jobs that pay $100k or more will be farmed out to other workers in other countries that can and will do the same work for half the pay or less, so if you are working from home in your pj's and are making extraordinary money, and are being called back to the office, I would go back to the office.
..or just get another PJ job
We did get called back to the offices.infosec engineer making 275k.
Remote work is mostly over for us that work in Financial Services , and yes I can do my job remotely and never need to go to the office, but they don’t care.
@@torsten6777 Well, that's my point.....ALL the high paying pj jobs will be sourced....all of them.
Real Estate - the entire industry - is criminal so what did you expect.???
They cook the books so they can justify everything! All by design and when we're on our knees, CBDC'S 😳
COOKED BOOKs 😁😁😁😁
Problem is that there always seems to be someone ready to pay more for a house. In order to stop all the flippers out there is to require you own a home for a couple of years before you sell. Or you get penalized.
good idea! make long term capital gains a 2-3 year wait for flippers instead of 1
💯💯💯
Real Estate should all have to be Owner Occupied by law. That would eliminate high housing prices .
@@marblox9300 and no foreign ownership. citizens only
@@utpharmboy2006 Yes, U.S. citizens who will actually live in the unit. No landlords.
The price for new houses may also be lower because construction is shifting to low price areas.
New builds are shitty construction. Way better built in most older homes.
Michael.... History has taught us the economy crashes when no one wants the risk associated with lending (short or long term). For this economic cycle, it may be when one of the biggest national banks runs into trouble and finds trouble borrowing at the overnight window. Or it may be when one of our foreign partners declares they will no longer buy our treasury notes. This will scare the market badly.
Well that makes sense because automobile repos are increasing rapidly and people will absolutely max out their credit cards and HELOC to keep the vehicle because typically need that for work so the fact that they're getting repossessed means these people have maxed out there credit availability
It took me till 60 to get a 810 Fico
Serious??? I'm 40 my scores 820 n my borrowing power is 136k in cc limit but my utilization is 4%
@@alexgonzalez-ke1oeI wasn’t always smart, traveled, spent.
@@tinamakaneole You splurged too much, Tina!
@@DIVISIONINCISIONi enjoyed it lol, Hawaii 😊
810! Good Job!
Clear and straightforward to use, help function very useful. Also helps to know that there are humans in the background. No negative issues to report. Withdrawals are straightforward and not time consuming MYSTICFLIP
Remember who used to bail out US debt. Taxpayers
Automation robotics drones machines arterfical intelligence
Non pay income taxes like we do.
I've been watching videos of the people buying "new homes" and it seems like the quality has gone way down. I'd much rather buy an older home right night. Built much better from what I've seen. My dad was a contractor/carpenter and they really did a good job in his generation.
Thanks I enjoyed the video
You are not buying a home! You are competing with each other to borrow a loan for a home! You are competing to pay high property tax and high property insurance for the next thirty years. 😂😂😂😂😂😂
No... 400,000 is waaaay too high.. Majority of Americans/buyers cannot afford anything above 250,000..And I won't pay that much.. I will stay where I am forever before I will pay outrageous prices.. Im hearing from buyers of new homes the quality is not good and they are having lots of issues with their new homes.. There will have to be a huge crash before I would consider buying..And I plan to keep the one I have now.. its pd for..
You are so right about debt and when the interests fall. There's a reason that interests will fall. And that usually means no one has money any longer.
Beautiful setting!! It is debt debt debt. All comes down to either keeping up with your neighbor or just totally cash strapped!!🤦♂️
"How about that bubble? That was kind of cool..." And that was a weird coincidence to me that I'm not sure you were concerned about. Maybe I'm reading too much into things - housing bubble, then you dodging that big old bubble there on the redondo beach boardwalk.
For those complaining about Feds raising interest rate. They've printed too much money and had low interests for years. If they dont raise the rate. Inflation will be worst
Get on a budget and stay on it 👈🏽
Our regular news in this country sucks!!! You rock!!! Thanks for the information!!!!!
The news is factual. You are looking for a certain spin on the daily news to make it more palatable for you. Why not juist raise your standards a little so you are not scraping through the sewage filter for news?
Another important thing about purchasing a new house is that it appreciates in value much faster than an older home.
Yeah because a split level aluminum sided house so high class. lol.
"The government" is not going into debt. YOU (and me and every other taxpayer) are going into debt. The government is taking out a loan on future revenue. In a word, taxes. The only way that works out in the long run - especially in a rising interest rate scenario - is if taxes go up and/or government services get reduced to pay the interest and the principle on the loan. Deficit spending is the government spending your taxes before they even get it.
What sucks about new construction is that it’s mostly tract homes with even smaller lots than before. It’s about 6000 ft.² my area with no space between neighbors, the houses are small and very cookie-cutter looking they no longer come with RV parking or third our garage, etc. and they are farther from amenities…
I wouldn't be so quick to get all excited about buying a brand new home when you see so much shoddy construction these past few decades. Be very careful and do a lot of research before jumping into that market.
Cheap illegal labor
I agree. I just moved from Minnesota to Florida and have been looking at homes built after 2015. I was in the carpentry for a portion of my life and the first thing I noticed with a lot of these houses is how shoddy the trim work was. It's like they didn't even try to cut decent miter joints. If something so visible as trim looks bad, what does that say for the rest of the place, the stuff you can't see? One of the places was a flip and I looked at the tile job in the bathroom shower and it was terrible, so terrible that I would personally rip it out and do it over. Don't people take pride in their work anymore?
It is really sad to hear about the credit-card debt. With me, I sometimes use savings in order to pay off the credit card in full that particular month.
I didn't know the credit cards had a debt limit. That is truly scary.
Another positive of the interest rate hikes is savers are finally getting a return on their money. My money market is now paying 5.21%. I cannot remember the last time I got a rate this good - probably in the 90s...
what bank?
@@nickc3856 For Example -- Republic Bank of Chicago, 5.21% APY Digital Money Market Account. $2,500 to open account. Maintain a minimum $2,500 daily balance to avoid $25 monthly maintenance fee. Hope this helps you!
@@nickc3856 Schwab
T-Bills like 5.25+
HELOC LOANS should be called HELL LOANS.
Thank you Michael for sharing your thoughts and homework.
Looks like you had a great walk today 😊.
Blessings, Carlos ✝️🙏❤️😊🇺🇸
Interest rates are going higher before they go lower. The fed wants to break inflation and they are not there yet, inflation is going to tick up in the next few months.
Gas and Milk are still $5/gallon-have wages EVEN keep pace with inflation
Before rates start to drop, they need to stop going up.
That's 16 billion dollars a month that consumers are paying in just interest on credit card debt!
@9:30 and @9:47 - let's wait until MB moves along and we could then grab those two corona bottles
Hello , Do you think MysticFlip can have a mortgage foreclosure be removed ????
Capital One card for good credit is 30.49%. Only excellent credit is 0% intro.
I think you should look at the downtown area and the cost of a curbside tent or the accommodations under a bridge. Come to California the land of 1000 bridges
Hi Michael, I am glad you are enjoying the So Cal weather. My opinion on older homes is that you at least know what you are getting. It’s established so you know how folks are keeping their yards and houses, thus retaining their value. Don’t underestimate the value on established landscaping and large trees. In a cheaper newer subdivision you are rolling the dice as to who is sharing that neighborhood with you. I have seen those purchases go way wrong
The problem with older homes is that they don't meet code anymore.
@@basha0810 This is partly true. Fortunately I purchased a house in Florida with a new roof which was the big deal there. I do need to retrofit my wood trusses and either install new hurricane proof windows or shutters to get a discount on insurance. I also have to do little repairs all over the place but I just love the huge Oak tree lined streets and older landscaping new hoods don't provide. But if you can deal with bare streets new houses are nice, because they are brand new ;-)
My niece was buying new construction years ago. My brother/her Dad is an HVAC guy. Her brother does construction management. After those 2 “inspected” the house, the builder gave her money back and cancelled the contract. The builder didn’t want to fix the problems they found.
Must have been non-sense bogus “problems” if he didn’t want to fix them.
@@torsten6777 One A/C in a 2 story house in an area with hot humid summers where 2 A/Cs is standard and inconsistent air volume from all the vents in the house = unbalanced ductwork = Half-assed construction.
He probably saw the writing on the wall and just backed out. Nobody wants to hear from "Karen" two years after a sale. Demand is too high to fuss with people who are going to create problems.
And that… that is how a recession becomes depression
people getting into homes now will be selling in less then a year due to being under water. FOr the pride of owning.
Someone said something similar in 2020.
@@trainsandlocomotives People said something similar in 2006 and 2007 as well. Don't think it can't happen, because we're overdue for it. Fed is keeping the economy propped up and looking good so Biden has something to campaign on in 2024, but make no mistake: whomever ends up in DC in 2024 will absolutely be dealing with one of the worst recessions in history, possibly even worse than 2008.
I WONT BE. BC IM NOT MOVING AGAIN. THIS WILL B MY LAST STOP
4:28 Government is not a business, it’s to provide services, not about making money.
I think you would enjoy Santa Barbara, Laguna Beach, La Jolla. I also recommend Northern Cali.
How do you refinance when you have no equity in your house? I've been down that road before. I don't wanna do it again. In fact this time there won't be HAMP to bail me out.
I only use credit cards now for the cash back benefits. At the end of the year I use that to treat myself to a nice plane ticket somewhere.
MY CASH BACK CARDS HAVE HIGH INTEREST RATES THAN MINE THAT DONT, SO TO BENEFIT YOU WOULD HAVE TO PAY THEM OFF MONTHLY
Youre going to love cbdc. Probobly be first in line wont ya.
What is the percentage of Americans who pay their credit cards off monthly without carrying over any interest debt? I'm guess it's like 20% or so.
@@erikarommelit’s a fine game. If you completely pay it off, your credit doesn’t rise. But if you allow $10-50 to rollover, it increases your credit score as it shows you know how to manage money “responsibly.”
@@Mimlou It is very simple. Just have certain monthly payments like streaming services or maybe something like a storage locker put on your CC every month and pay the balance off monthly. You can even set up an automatic monthly payment from your bank account matching the payments you make on your CC. I haven't had significant debt, credit card or otherwise in over a decade and im in the 850s.
@@erikarommel So let's suppose you had several thousand dollars of CC debt, and you work hard and pay it all off. Yes, your credit score will jump because you were responsible and paid off your debt. But, let's suppose that you then swear off using CCs for a while. After a few months, you logon to check your credit scores and are flabbergasted to see your scores have actually dipped. What gives? Because you're not using credit, yes your scores will drop for non-utilization. I used to work at a major CC company (that also gave out personal loans) and I saw this all the time. People would pay off all their debt and get a nice fat 800+ score and then not do anything else for a long while, and then their scores would inevitably plummet and they would no longer qualify for our best offers etc. Then they would call in all pissed off and all I could tell them was "go check your credit report online for free" (even though I could see their credit scores I wasn't allowed to actually talk to them about why or anything, as an side this is absolutely "the system" looking out for itself before the people it's supposed to serve but I digress).
Dave Ramsey said it best: What's the point of a credit score? To borrow money. Why? To borrow *more* money. Why? To borrow *more* money. Why? To borrow *more* money.
PROBABLY LESS