5 Things that Could DESTROY the Economy and The Real Estate Market. 2022 WHAT COULD GO WRONG?

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

 

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