- cross-posted to:
- BoycottUnitedStates@europe.pub
- cross-posted to:
- BoycottUnitedStates@europe.pub
Investors are selling off bonds from the U.S. government, as part of a trade known as “Sell America.”
The United States government has had to pay more to borrow in the global debt markets. On Wednesday, the Treasury department found that there was tepid demand for an auction for $20 billion worth of bonds, and ended up paying a slightly higher interest rate (or yield) than expected.
This has spooked markets. Yields on 30-year U.S. Treasuries have spiked above 5% this week — an unusual, and unsettling, surge in the price that the U.S. government pays on its long-term debt. An increase in bond yields is particularly damaging to the economy because it jacks up the interest rates on many things that consumers pay, such as on mortgages and other loans.
8 years ago, I bought a house at 3.25% interest on a 30 year loan. We are currently looking to move and interest rates are damn near 7% because of all the fuckery going on and it is probably going to keep going up since no one trusts anything in the economy right now.
I’d hate to have to buy a house in USA right now. High interest rates and I’d worry about the possibility of a collapse in house prices too.
That’s unlikely to happen, and in my layperson’s understanding, that’s probably as bad as a collapse in housing prices.
The U.S. housing market is currently supply constrained, according to this Brookings podcast.
Between the above supply constraints, corporations/venture capital funds snapping up houses, yo-yoing tariffs either driving up costs or creating uncertainty for builders, and climate change rendering millions of homes uninsurable/unfixable in case of disaster, the demand will only increase.
At the same time, a weakening dollar and soaring rates will make houses more expensive to buy and finance.
There will be a real-estate reckoning. I just don’t see it happening irrespective of other factors. I’m more worried about people who don’t have a house or don’t have some way to protect themselves from the economic hell that has yet to unfold.
Interesting, I never thought of it that way, I just thought bad economy would lead to lower house prices.
Yeah - I mean. I’m not an economic analyst by any means, but a lot of people keep expecting a housing market “correction” in the U.S., but one keeps not materializing.
Usually consumer sentiment is self-fulfilling, but the market and the government seem intent on white knuckling their way through this, through whatever shenanigans they have to pull. Ultimately, I sort of think a hyperinflation scenario is becoming more likely.
Yeah that’s where we are at, sellers still think they are worth covid prices and the broader market is in complete chaos. If we weren’t out of room from having a smaller house with 2 kids, I would be more receptive to sticking it out but the chaos has become less manageable so we are looking for more room despite not really wanting to make any decisions right now.
This is the situation I’m in. We’re pretty much forced to, to move in my wife’s disabled mom. And still when we find a house we kinda like there are four bids on it above asking price, made sight unseen.
Around here (houston metroplex) there is not a bidding war but sellers are acting like there is or should be one. There are several houses we liked that have been on the market for upwards of half a year and the sellers are unwilling to negotiate on prices that are significantly higher than market value or prices of comps. We had an offer on a house that we walked away from recently where the seller outright refused to negotiate on price after the inspection found it needed a new roof and 2 new ac units despite being priced higher than it should have been already.