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Culture War Roundup for the week of October 30, 2023

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How much of the market is first-time homebuyers? I figured demand might be up given

  1. the last couple years being (perceived as) a bad time to buy
  2. Cost of living pushing people to downsize
  3. COVID factors like remote work pushing people to move

But when I check total sales it looks like we’re at 2010 lows, so maybe you’re onto something.

It certainly doesn’t feel like a tight market here in Texas. My coworkers are reporting chaos, a dozen offers on the first day, racing to outbid each other with starting offers. It sounds like hell.

The housing market is currently irrational with median home prices outpacing median income for the first time since, well, ever. Certain markets are more insane than others. The median home price in Idaho is now $469,000 while median income in a dual-income family is just under $70,000 before taxes. Assuming a 20% down-payment of ~$100,000, the monthly mortgage payment would be $3,538, roughly 60% of the take-home for the median household. Arizona, Utah, Wyoming, Colorado are all fairly similar in terms of median home price outstripping the ability of the locals to purchase. Meanwhile, the southeastern US is pretty stable with low prices and reasonable overturn in inventory.

Texas is somewhere in the middle from what I've seen. Houston and DFW area both have lower home prices compared to some of the really inflated markets in the west, but not as low as the rest of the southeast. It wouldn't surprise me to know that many of the Cali/NE corridor transplants are currently driving up the market in Texas like they did in the mountain west during COVID.