2022 Real Estate Red Flags

Has my long-term readers know, I’ve been warning of a residential real estate market bubble bust for a number of months now. For those of you who may not be regular readers here is the link do the first warning blog post that I put out; my first post where I called the real estate market top was June 15, 2021 (https://brokerforyou.com/brokerforyou/real-estate-market-downturn/ ) . On June 17 I had a follow-up post ( https://brokerforyou.com/brokerforyou/real-estate-market-bust/ ) where I added additional indicators, that to me showed that the market was in a topping phase right now! I put the links to each one of those prior post above, and would suggest if you’re interested, to reread those posts!

Although the residential real estate market has not yet taken  a definitive downward turn, there have been many signs and indicators that have subsequently come out, which would seem to confirm my original call for caution in this market.

2022 Real Estate Red Flags

Now, with the stock price of Zillow and Opendoor  taking massive hits, I personally believe there couldn’t be a more obvious pair of indicators telling  the astute public what’s  eminently heading its way.  Okay, now for the disclaimer…  These are just my personal opinions from having been in the residential real estate market as a real estate broker for over three decades. So, naturally, before making any move in the real estate market you should always consult both your legal and financial advisors.  Actually, I see a lot of people getting hurt here if the market takes the dive that I think is in store, so I really hope that I’m wrong in my opinion.

Opendoor – the largest Home Buyer in America – has seen its stock price CRASH by 40% over the last month. Could a US Housing Market Crash be NEXT?

The company purchased 15k homes across the US Housing Market in Q3 2021, are seeing their stock price collapse over the last month, going from $24/Share in late October to $14/Share today. That’s a massive 40% crash and suggests that Wall Street is predicting a potential Housing Crash.

Opendoor is following in the footsteps of Zillow, who also experienced a similar crash in stock price last month. Why are these companies struggling so much, while the NASDAQ Composite is only down by 3% in the same span?

It could be that there’s a prediction for 1) Fewer Home Sales and 2) Home Prices Declines across the US Housing Market. If Home Sales and Prices were to go down, it would likely mean reduced revenue for both Opendoor and Zillow. And thus Wall Street is selling out of their stocks before the Housing Crash occurs.

Interestingly – not all real estate-related companies are crashing. Invitation Homes, the largest homeowner in America, is flat over the last month. While DR Horton, the biggest homebuilder, is actually up by 15%. This suggests that there’s some nuance to how the Stock Market views the future of US Real Estate.

2022 Real Estate Red Flags