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Harvey Specter · 02-25-2022, 12:13 PM

This the best line I hear in our local RE market:

“Borrowers are tested for the ability to repay a mortgage at a higher rate, so defaults are unlikely”.

I know people who couldn’t get a mortgage through the front door of the bank based on their salary but someway found the back door of the same bank through a broker and got themselves a million plus mortgages. This is not how a "normal" RE market should operate.

And not sure what the logic is when people claim a rate that could hit 2% won't impact our pandemic induced RE market bubble. The last time we had a rate around 2% was prior to 2008 and since 2008 you can chart how RE prices and rates have basically moved in tandem.

I'm not saying the RE market will crash by 50% but it can (and most likely) go down to pre-pandamic levels. Anyone who bought at peak prices could be a in for a shock because what I've also realized is a lot of people are oblivious to what's happening with rates and the economy in general. They react when it's too late and that's when panic sets in and panic is the last thing you want in this market.

02-25-2022, 12:13 PM	#20897
Harvey Specter y'all better put some respeck on my name Join Date: Dec 2002 Location: Vancouver Posts: 18,930 Thanked 10,304 Times in 2,717 Posts Failed 395 Times in 161 Posts	This the best line I hear in our local RE market: “Borrowers are tested for the ability to repay a mortgage at a higher rate, so defaults are unlikely”. I know people who couldn’t get a mortgage through the front door of the bank based on their salary but someway found the back door of the same bank through a broker and got themselves a million plus mortgages. This is not how a "normal" RE market should operate. And not sure what the logic is when people claim a rate that could hit 2% won't impact our pandemic induced RE market bubble. The last time we had a rate around 2% was prior to 2008 and since 2008 you can chart how RE prices and rates have basically moved in tandem. I'm not saying the RE market will crash by 50% but it can (and most likely) go down to pre-pandamic levels. Anyone who bought at peak prices could be a in for a shock because what I've also realized is a lot of people are oblivious to what's happening with rates and the economy in general. They react when it's too late and that's when panic sets in and panic is the last thing you want in this market. Last edited by Harvey Specter; 02-25-2022 at 12:18 PM.