REAL ESTATE CRASH OF 2021 - My Thoughts | Summary and Q&A

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December 11, 2020
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Andrei Jikh
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REAL ESTATE CRASH OF 2021 - My Thoughts

TL;DR

Real estate investor Andre Jake believes that a real estate crash is imminent, citing factors such as delinquencies, high inventory levels, and potential job losses. He advises caution and offers investment strategies to navigate the uncertain market.

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Questions & Answers

Q: Are there any signs of improvement in the real estate market, despite the predicted crash?

While delinquency rates have slightly improved and refinances are at an all-time high, there are still concerning indicators, such as a five-fold increase in serious delinquencies since the start of the pandemic. The market may see a temporary boost, but long-term outlook remains uncertain.

Q: Which cities are likely to experience the biggest declines in real estate prices?

Las Vegas, Miami, Orlando, New Orleans, and New York are expected to see significant declines in real estate prices due to various economic factors and high delinquency rates.

Q: How will job losses impact the real estate market?

The world economic forum predicts 85 million job losses by 2025. If there is a double disruption event where new jobs are not adequately filled, it could lead to an imbalanced demand for housing and negatively impact the market.

Q: What investing strategies does Andre Jake recommend for real estate?

Jake plans to wait and evaluate the market after the forbearance period expires to assess the potential damage. He suggests buying inflation-protected assets, such as Bitcoin or the S&P 500, depending on the inflation rate. He also considers investing in real estate rental properties when the market stabilizes.

Summary & Key Takeaways

  • Andre Jake, a non-licensed real estate investor, discusses his desire to buy a house and the pressures of keeping up with friends who have already purchased properties.

  • He predicts a real estate crash in 2021 or 2022, based on increasing delinquencies and forbearance rates. However, he acknowledges temporary boosts, such as record-breaking home refinances.

  • Jake highlights the importance of considering two major factors: government actions and job stability. He believes that the expiration of forbearance programs and potential job losses could negatively impact the real estate market.

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