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good evening welcome to the Deerwood Realty YouTube channel I'm John Schink managing broker and founder of dearwood realy in St Louis

Missouri we're getting to this point where you have like the Market's going to go down the housing market and then you have people say that it's not going to go down and then you have I mean just every day like it's it's going to do both in my lifetime still so then people have been making fun lately of the reasons why it's going to go down like people have all kinds of ideas about it's going to go down for this reason that reason I've told you what I thought about stuff I think the Market's going to go down but I don't know when I don't know how much I I try to avoid saying the Market's going to crash because I think that that's just to engender clicks and I don't want to do that but uh anyway came across an article this morning I believe or maybe last night blaming the Boomers it's the Boomer fault they get blamed for the house prices going up and they're getting blamed for the house prices going down they just can't win they don't they refuse to fight back online I guess is the is the issue let's get to the article so I got this off of

Yahoo thought this was kind of interesting says analyst Meredith Whitney is known for her call that anticipated the 2008 financial crisis I've never done this before and it's going to be a little weird because my screen's messed up but I think Meredith Whitney should be known for being married to the professional wrestler John lafield Brad

chw that's that's what I

think I don't know oh that was interesting anyway now she's predicting that the housing market is due for some dramatic changes in 2024 oh really like we've been going on this run for how long and now it's going to be shocking if it changes says prices will go down and the supply of homes for sale will go up she said Tuesday revers current dynamics that make the home buying process difficult for ver for many Americans so let me get this straight the supply of homes for sale will now go [Music] up why why the Boomers really the reason a silver tsunami of baby boomers who are expected to start downsizing H what does that mean this is fascinating says citing AARP estimates Whitney says 51% of people over the age of 50 a group that owns More than 70% of us homes are set to downsize to smaller homes that would bring more than 30 million units of housing onto the market now I'm just I'm just going to put this out here I help a lot of people sell homes I help a lot of people buy homes in this current market it's so screwed up that most of the time the only stuff that's available is either divorce or a death okay and the death is from somebody that's lived in the house for like 40 years they have never done anything to it they've never updated it and that's what you're seeing in the marketplace that's the supply and yet I'm supposed to believe that all of a sudden people will stop living in their homes forever and then just dying in them no no they're going to downsize they're going to sell their house and they're going to move to a smaller house like that's going to happen

hard to believe I I hate to say that but just hard to believe it says um so that would be 70% of us homes okay so I'm a little bit confused here because um I know that investors are supposed to own 25% of all the housing stock in the United States uh so now we've got 70 plus 25 so only 5% of people under the age of 50 own a home in the United States it seems that seems off I don't know I mean just seems off to me and then it says that would bring more than 30 million units of housing onto the

market well I've argued for a long time that you know short-term rentals and those types of Investments are probably going to go south probably I'm not sure and then that should bring Supply and then you've got these Boomers that are supposed to be retiring and that's going to you know help and then apparently we're building lots and lots of multif family units so that's going to bring on more supply problem solved right here's the issue do you if you if you own a house do you really want to see the price go down ever H says you'll see a supply demand Dynamic shift Whitney founder and CEO of Whitney Advisory Group told Yahoo finances Chief investment invest conference on Tuesday she's married to a wrestler that's pretty cool um H so the reason why we're having problems right now is because we don't have enough supply of homes and yet when the when the older Generations they decide to downsize that's going to increase Supply won't that just hurt the supply for the young people who are trying to buy starter homes

Whitney sees the shift beginning late next year in 2025 and says it's a multi-decade cycle now I have heard two things number one the population is crashing in the United States as far as uh children being born many many fewer children being born right now almost a crisis and now we're seeing

this multi- deade cycle of older folks downsizing

I hate to say it but like older folks dirt napping is more likely because they're not going to sell their house to downsize they've lived in the same house 40 years they're going to die

there anyway Americans are sitting on a tremendous amount of equity in their homes it's a question of when they tap into it very fascinating you're 80 years old you've got health issues and you've got your house is paid for and you maybe get some sort of Social Security you're going to sell your house and do what go on a vacation I mean there's no problem with that I have nothing wrong with it but this idea that these people who paid off their houses decades ago now all of a sudden want to jump in and start spending money like you know crazy seems a little bit off to me with so many older Americans sitting on all that cash when they look to downsize they're unlikely to be affected much by higher mortgage rates of around 8% she said here's the thing here's the thing so you have all these people that are supposed to have all this money right and I now I've seen this don't don't get me wrong I've seen older people move into condos before and things of that nature it's not it's not too shocking to me but if you're sitting on a pile of cash you've got to sell your house okay to downsize mortgage rates are 8% they're not at 8% right now I think they're it's like seven and a half today on a 30-year fix good credit um what are you doing like what are you getting in a bidding war with like a starting home buyer and if you do won't that make the prices of the starter home go up even

more I mean won't there be this perfect maybe two-bedroom home with one bathroom on the main floor and hopefully launder and uh washer and dryer like aren't aren't there two different groups that are going to be fighting for that well who do you think's going to win who has the most Capital at their disposal

so why wouldn't that happen it says I think it's R agnostic because older people have lower mortgages if any mortgage at all yeah but they bought their houses for maybe $50,000 do you think they're really comfortable spending $350,000 for the same house they could have bought I don't know 40 years ago it says but she said there's a risk associated with that shift there may not be enough younger buyers and sellers may just decide to sell it lower prices so they can pocket their gains that's a very interesting thing okay I I do I do have some some experience with this a lot of times I'll be working with um people and they'll say you know what I'm going to make like 10 times on the sale of this house I've lived here all my life and I've got like maybe a year before I die I don't think I'm going to fight over like five grand I really don't care which is odd like it's hard to deal with as a real estate agent because you're you're trying to get the best deal possible for your seller and your seller's already kind of like not in a good place they're ready to let their things

go it says that's why prices have got to come down and be commiserate with rates there's a mismatch here well that's not rocket science there's obviously a mismatch things obviously aren't aren't setting up to be really that great in the

market I don't know what to think of that that I I do believe there's a demographic shift but but at the same time I mean there there's at least hundreds of thousands if not millions of people streaming across the southern border maybe even the northern border I don't know but those people are going to need houses too I don't think people are going to be deported I don't I just don't see that

happening and in in in a larger sense oh I hit the microphone in a larger sense um maybe the reason why we're you know the government's just allowing these people to come over is because they know that the birth rate is so low in cratering and they know that the demographic shift is happening and they're trying to you know maintain what has been the norm for most citizens their entire lives I don't know what do you think I'll leave the comments on this morning this morning this afternoon this evening I'll leave them on forever how about that um I don't know it seems it seems far-fetched that scenario just seems kind of far-fetched anyway thank you for watching thank you for listening I'll catch you on the next one