Investing

My Thoughts On The 2021 Real Estate Crash

my-thoughts-on-the-2021-real-estate-crash



Here are my thoughts on the 2021 real estate market, where prices are heading in the future, and how I’m investing in real estate moving forward – Enjoy! Add me on Instagram: GPStephan

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Here’s what’s going on right now: mortgage rates have continued hitting historic low after historic low, and that bodes REALLY, REALLY well for real estate. But even though record low rates means there has NEVER been a better time to buy real estate and get a mortgage, fewer sellers want to list their homes for sale, and that’s creating a housing SHORTAGE.

Marketwatch included a graph showing the trailing 12 month returns of real estate versus the stock market – and the great financial crisis of 2008 was the ONLY time where real estate experienced a 12-month trailing loss of more than 2%. That means, that – over the long term – real estate as an investment is going to be fairly stable and uneventful, despite what happens with our overall economy.
https://www.marketwatch.com/story/look-what-happened-to-home-prices-when-the-coronavirus-sent-stocks-into-a-bear-market-2020-07-21

Real estate is also proving to be a good hedge against inflation, and that could also be driving higher than normal demand with rates as low as they are.

Even for myself, I’m a firm believer in getting a low interest, fixed rate mortgages on cash flowing rental properties as a hedge against inflation – and then, just take 30 years to pay them off in full while the home goes up in value. I think that’s a sound investment strategy when you do this correctly…but the problem, at this point…is that home prices are skyrocketing, and there’s NOTHING to buy.

As a real estate investor, it’s paramount that you get a good deal on a property with some upside so that you can fix it up and make repairs…but, everything I’m seeing is selling a premium because there aren’t many other choices on the market, and prices are increasing faster than I expected because other people are willing to pay whatever it takes just to get the home.

There’s nothing wrong with doing that if your intention is to buy something for yourself…BUT, from an investment standpoint, it makes it VERY difficult to come out profitable.

Despite all of that, though…the future of what’s going to happen with housing prices is hard to determine. Right now, yes – prices have been going up – a lot, whereas – seasonally, they would be going down. Sellers area also getting closer to their asking price, on average, than usual – but, how long can this hold up for?
https://www.redfin.com/blog/home-sales-and-prices-keep-climbing/

Well, the tech company Haus predicts that real estate will see about a 1% decline into 2021…but then predict, after that, growth could continue as high as 4-5% once our economy begins recovering.
https://haus.com/resources/june-2020-hausing-market-forecast

CoreLogic, one of the largest data analytics companies, found that – even though prices have risen 4.8% year over year…they expect that, over the next year, will see a drop of 6.6% in real estate prices…
https://www.corelogic.com/insights-download/home-price-index.aspx

I have a feeling, as long as consumer spending is low and our economy is shut down – interest rates will stay low, and demand for real estate will stay high. But, if that changes, after about 6-12 months or so, I would expect rates to slowly go back up – and that might begin to change the pace of real estate, especially if more sellers begin to list their homes for sale.

I’m still actively looking to buy something else for myself…BUT, I want to make sure whatever I buy is somewhat of a good deal, and I’m not going to overpay just for the sake of buying something.

For business or one-on-one real estate investing/real estate agent consulting inquiries, you can reach me at GrahamStephanBusiness@gmail.com

*Some of the links and other products that appear on this video are from companies which Graham Stephan will earn an affiliate commission or referral bonus. Graham Stephan is part of an affiliate network and receives compensation for sending traffic to partner sites. The content in this video is accurate as of the posting date. Some of the offers mentioned may no longer be available.

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Robert Dunfee

40 Comments

  1. Manicks Channel
    July 18, 2021 at 5:00 pm

    I feel like a guy who invests in real estate is trying to convince people to buy his overpriced properties thus completing his investment in real estate that he purchased at a much lower price tag.

  2. Floki Emmanuel
    July 18, 2021 at 5:00 pm

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  3. Diego Brambila
    July 18, 2021 at 5:00 pm

    Lets say, if I where do mortgage a home and have a low interest rate. And crash where to occur can’t I just get the price re-adjusted? If my question isn’t clear what I’m trying to say if I mortgage a home that is 100k and I just down 15k with a interest rate of 2%. And the market crash making my house worth 50-70k can i try to drop my price.

  4. Kyou Sei
    July 18, 2021 at 5:00 pm

    Low rate is only a piece of puzzle. Just like equities, smart investors don't buy stocks w/high PE because it's commission free or because of low margin rate. It would be stupid to buy a $500K hyped up property with 2.50% when the property is actually worth only $300K. And, with maint. costs, property taxes, and opportunity costs… net net, you still lose money with that 2.5% mortgage rate. And, don't forget, many people are on forbearance. I'll let those sellers hold their inventories. I'd like to see how long they can hold them.

  5. Antony Mwirigi
    July 18, 2021 at 5:00 pm

    Love this video

  6. Jaydon Rose
    July 18, 2021 at 5:00 pm

    Blue thumb👍🏻 … and a bonus comment for the YouTube algorithm! 😋

  7. Matthew Villarreal
    July 18, 2021 at 5:00 pm

    wow, real estate investing sounds a lot like a ponzi scheme

  8. Andrew Beltran
    July 18, 2021 at 5:00 pm

    I bet I can beat Graham in a game of Monopoly.

  9. Kevin Shirl
    July 18, 2021 at 5:00 pm

    There are over two million 90,000 foreclosures in the United States happening right now!

  10. perf b
    July 18, 2021 at 5:00 pm

    Graham started out in the 2008 crash and bought a foreclosure as his very first house, that is how he made money, now he has looked for 6 months and cant find a deal to buy. Deja Vu anyone? 12 years between crashes is about right.

  11. perf b
    July 18, 2021 at 5:00 pm

    @8:24 Graham looked from March to August and couldnt find anything to buy, that is pretty amazing if a smart and dedicated guy like this cant find one home for sale in 6 effing months that makes economic sense.

  12. The Deliverance Lifestyle
    July 18, 2021 at 5:00 pm

    I want to get my Real Estate License can you recommend (the best classes) where I can go to a class? I value your feedback. Thank you.

  13. LostConciousness
    July 18, 2021 at 5:00 pm

    Everyone: you should consider buying a house
    My millennial wallet: nope

  14. lisa29371
    July 18, 2021 at 5:00 pm

    Freaking love ur videos!!! Straight to the point!!

  15. Andrew H
    July 18, 2021 at 5:00 pm

    Graham, do you think stocks (broad market fund) or average nation property prices will protect better against inflation?

  16. A Hole
    July 18, 2021 at 5:00 pm

    Love this video

  17. Solangie Laboy
    July 18, 2021 at 5:00 pm

    1:11 love this momment

  18. Trent Thomas
    July 18, 2021 at 5:00 pm

    0:53 What's wrong with it?

  19. Christopher Sanders
    July 18, 2021 at 5:00 pm

    Wow, tradewith_alberto_walker on IG made me so rich.

  20. Pham Quyen
    July 18, 2021 at 5:00 pm

    Aint no body watch this!

  21. Sam Lan
    July 18, 2021 at 5:00 pm

    Well yeah, that's what we expected

  22. Sheyenne Allonce
    July 18, 2021 at 5:00 pm

    Anyone still watch this video?

  23. placenta pattie
    July 18, 2021 at 5:00 pm

    1:11 love this momment

  24. W M C
    July 18, 2021 at 5:00 pm

    You uploaded this at August 3, 2020. Today is October 15, 2020. GS, Hard to advise people as you know you're struggling to find your way on your next one. There are many 'all cash' buyers in the neighborhoods I'm looking. Not being pre-approved by a Lender is a sure way to not be taken seriously when you're submitting your offer. That Pre-Approval Letter needs to be fresh and Proof of Funds on a current ATM receipt or fresh bank statement needs to be included with the offer. Banks are scrubbing every detail really hard these days. They look at everything very closely and ask a lot of questions, need documentation. Sure, I just got $1.4MM @ 2.75% fixed but it was not easy. The property I locked-in for $1.7MM appraised at $2.15MM a few weeks later and cool as that sounds the entire process was very tedious. Good energy in the video. Thanks.

  25. J Jojo
    July 18, 2021 at 5:00 pm

    So i have a question, you say market value goes up in Suburbia areas without addressing the growing residential areas that where once unpopulated. housing grown on the outskirts is always valued at more until people actually purchase it, and then a year or two later are told their properties are only worth what is the going value said properties because its no longer the outlining property.
    how exactly are your viewers making money?

    You seem to have shill in the value of your common man or how they should spend their money, or how someone might make an actual profit off your channel. your good for few ideas for building a aesthetic home for sure, but hardly who i would call upon to break me from a financial crisis.

  26. Joey Finrow
    July 18, 2021 at 5:00 pm

    Homes in my market are still increasing in value like crazy here in OC California. Just sold a home $40,000 over market value and the buyer paid cash. I think this could change in the near future thou. Graham when do you think interest rates will go up?

  27. winnifrd ugwi
    July 18, 2021 at 5:00 pm

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  28. W i n s t o n G o n z a l e z
    July 18, 2021 at 5:00 pm

    cool

  29. Serginho Filho
    July 18, 2021 at 5:00 pm

    A natureza é maravilhosa

  30. SWEETABLES LAURIE
    July 18, 2021 at 5:00 pm

    I can't listen to that voice..calm down.

  31. Jonny Riga
    July 18, 2021 at 5:00 pm

    Think it would be a great idea content-wise to do a movie Monday with real estate related movies. Start with The Big Short maybe. There some others like Arizona and Larry Crowne. Could be a good idea. Loving the content my man. More is better.

  32. verves v
    July 18, 2021 at 5:00 pm

    0:53 Love this moment

  33. thiadova
    July 18, 2021 at 5:00 pm

    Define crash. In Florida prices are still too high & most have dropped their listings. No crash here.

  34. Platinum
    July 18, 2021 at 5:00 pm

    Graham… Quit being a salesman….
    People…. Low interest rate means squat when your home value tanks and you lose your income.
    Don't buy real estate at all right now! You DONT want to catch a falling knife…

  35. Aleexsnchz Grey
    July 18, 2021 at 5:00 pm

    Am very appreciate @hackeryinks on Instagram😍 that i got my apartment so easy

  36. Joseph Vaccaro
    July 18, 2021 at 5:00 pm

    Did you buy when it crashed though. If not, another one is coming don't worry. Keep tapping your heels and it'll come true! Try not to miss it!

  37. martin sloan
    July 18, 2021 at 5:00 pm

    Most people can't afford groceries. Restaurants, hotels, travel, service industries are dying. Kind of hard to watch the 5% and their real estate problems. When people have money, it's easy to forget about those that do not.

  38. Darren Malone
    July 18, 2021 at 5:00 pm

    I’m a long time mortgage broker. Very little discussion about the first wave of six month forbearance coming do now for all those past payments or people adding another six months on top of that and then what if they don’t get them modified? I can’t help but seeing a wave of foreclosures coming in the next six months to two years. Because conservatives are holding onto their real estate and low inventory, buyers will still be propping up prices until it pops

  39. Stephen Rudyk
    July 18, 2021 at 5:00 pm

    Real estate is going to crash hard

  40. Edward Angelus
    July 18, 2021 at 5:00 pm

    Hi Graham, have you ever looked at the UK property market? I am from the states, but have been living in the UK for twenty years. We have most of the same property swings, but it might be interesting for your viewers.