Video Closed Captioning:
good morning good afternoon good evening
folks michael zuber one rental at a time
and what i want to do here very very
quickly is say what are five things
that could go wrong in 2022 i’ve done
several videos over the last week about
what i think is coming we’ve done some
over unders with other experts but i
wanted to flip the coin i wanted to look
out into the future and talk about five
things that could go wrong that way you
and i are looking for these things
realizing that if they did happen they
could really impact the year
so number one
number one
we could repeat some of the sends of
2004 and 2005. if you don’t know what
i’m talking about
that was the era of letting
non-qualified buyers
buy
that was the era of leading
non-qualified investors by
several yes folks the big short that
jokes about strippers buying three or
four homes is real i saw it
and uh it was unfortunately a national
sport
i do not expect us to create mortgage
products that will then send
non-qualified buyers to become buyers
however i am concerned
that we may create down payment
assistant programs
that allow people to get into homes that
are not yet financially ready let me be
clear i believe getting on the property
ladder is amazing i believe getting on
the property ladder and staying on the
property ladder is outstanding
i am concerned that we may create
incentives to get people on the property
ladder that just don’t have the
financial education to stay there
if you get on the property ladder and
you are kicked out with a foreclosure
short sale or deed in lieu after two
years
is that a win
i say no
again
i want you to hear me if you get down
payment assistance and you stay on the
property ladder that is a huge win yay
congratulations
i am concerned because i saw last time
people
get a yes answer from a bank
that shouldn’t
they shouldn’t and they lost eventually
so again one of the things we could do
is we could over rotate we could create
down payment assistance for first-time
home buyers that are just not ready
yet
they’ll get ready but they’re not ready
yet and if you put somebody on the
property ladder who can’t afford it
bad things will eventually happen it
will feel great
in the short term
bad in the long term so that is number
one
number two
we could get an interest rate spike
so what do i mean by spike first and
foremost i do believe what we are seeing
is a general tick up in interest rates
uh yes the last week or so have gone the
other way so congratulations if you take
advantage of those but interest rates by
12 months from now i suspect will be
higher
i suspect they will get higher
gradually
let’s say some black swan event comes
out and suddenly rates spike
and what do i mean by spike so let’s
take the 3.3 percent 30-year mortgage
and take it to 5
let’s say we do that inside of 30 days
essentially interest rates would go up
50 percent in 30 days
that is a spike that would freeze the
housing market
that would be bad that would have ripple
impacts across all kinds of debt markets
and that would stop real estate in its
trans in its tracks as we figured out
what the heck is going on
so we could have an interest rate spike
in fairness if interest rates went the
other way instead of going from 3.3 to 5
what if they went from 3.3 to 1.5 well
party on refinance everywhere
buying because houses are more
affordable
all of that stuff
so yes one thing that could stop this is
a interest rate rise
number three
and frankly of all five this is the one
that scares me the most because i think
this one is most likely of the five not
saying it is most likely but of the five
this is the one that i’m like
this could happen one of my greatest
fears and i’ve talked about it a lot
over the last two months is we have a
stagflation environment which means we
have inflation above six seven percent
and we have a job market that is
deteriorating we have inflation and no
growth
that is um
that’s not good and i actually think
that is a is a real risk next year
especially because as we talked about on
the daily financial news today jerome
powell has now made in stable prices his
thing
and that means that maybe he just
focuses on inflation even though the job
market in the economy goes into
recession that is a concern that i have
sorry my dogs are making noise over
there
number four
we could have
i don’t know if you would call it a war
or a conflict or some kind of
international incident where two large
countries get cranky with each other and
soldiers are dispersed
war is bad
war that takes on
more and more spending bad
uh again this is not something i hope
for it’s not something that is possible
or not something that i think is really
likely but it is possible
a a war a version of this
would not be good in my opinion
and then finally one that would really
be hard to think about but is at least
out there is national rent control
i believe uh
states would rise up and fight this but
again something that could go out there
as rents increase because values go
first rents go second uh we could see
this become a dominant thing
theme uh and if you don’t know there’s
pretty solid evidence that the only way
to destroy a city faster than rent
control is if you bombed it yes folks
rent control you can look at san
francisco new york and many other areas
does not lead to investment leads to run
down buildings and the only people that
benefit from rent control are the people
that got in early
the folks that try to get in later no
inventory nobody’s moving it is not a
good thing so again
those are the five things that could go
wrong let me know what you think of the
list and also let me know what else you
think could go wrong next year i
appreciate you have a wonderful day
bye bye