What, Me Worry?
National Lampoon, a magazine devoted to satire, had P J O’Rourke as one of the key contributors. They were behind movies such as Animal House, Vacation, and others. P.J. O’Rourke passed away this month. Alfred E. Neuman was the poster child for the magazine with the phrase, “what, me worry?”
Every month, the University of Michigan measures how consumers feel about the current conditions. The measure released for January 2022 on February 11 points to substantial concern. Today, it’s consumers who worry. Consumers’ worry reached the highest in a decade (since the 2008 crash period). In fact, the chart below shows worry points. The 2008 meltdown (and 2011 flash crash). The recessions of 1973-1975 (high inflation) and 1978-1982 (massively high inflation). These reflect the only period where consumers worried more. Is another recession likely? Pick up a copy of Winning Mortgage, Winning Home to be prepared to act when others run. Buy when its advantageous. Get the right mortgage. And above all else, make the positive buying and mortgage moves at the right time.
One can come up with reasons for this spike in worry. Pick any of the ones below or come up with your own. Rampant crime from defund/kill the police and BLM (which became a massive $60 million fraud scheme). Carjackings, murders, shoplifting all hitting records due to non-prosecution and reductions in policing. The under-incarceration problem is rampant. Repeat offenders and those with long criminal records go through revolving doors and can be back repeating crimes within hours in many states.
National Causes
The most rapid rise of inflation in history with Bidenflation and clueless Federal Reserve. Open borders with midnight flights moving illegal immigrants without any ID. Can you fly without ID? They can. Moved throughout the country and gifted with pre-paid iPhones (1 year free) along with cash and other benefits which American citizens do not receive. (Let us know if you have proof to confirm or refute this as reported by many news organizations).
Clueless military/foreign policy leadership (Afghanistan, giving Iran nuclear weapons, Ukraine, re-arming terrorists in Lebanon with US taxpayer dollars). Mask/school mandates suppressing any discussion of actual science on effects of masking. Failure to investigate and even denigrating/banning discussion of potential Covid treatments. Shouldn’t treatment for those becoming sick be publicized instead of vaccine only policy? I would want to know potential treatment or prevention options.
Housing Market Effects
Housing prices unaffordable and spiking interest rates. Increasing foreclosures. Buyer regrets. Consumers are also home buyers, renters, and borrowers. As a result, most buyers now think it’s a bad time to buy a house.
Zillow’s most recent press release studying buyers shows that buyers got caught up in FOMO and came away with lots of regrets. Having done so, the current economy would add to worries of these consumers.
Press Release – Seattle, Feb. 8, 2022
- 75% of recent home buyers have regrets about their new home
- A less frenzied spring market could ease buyer’s remorse by giving shoppers more time to weigh their options
- The top regret cited by recent buyers is purchasing a home that needs more work or maintenance than expected.
- Nearly three-quarters of successful buyers wish they had done at least one thing differently; nearly 40% wish they had taken more time searching for a home or weighing their options.
Purchasing a home in a rapidly appreciating and hypercompetitive housing market can feel like winning the lottery. But a new Zillow survey finds even those who are successful often make compromises and can suffer from buyer’s remorse. Current and aspiring home shoppers can learn from the regrets of these pandemic-era buyers with help from new technology and a housing market that could offer buyers a bit more breathing room.
Zillow’s surveyi finds three-quarters of those who successfully purchased a home in the past two years say they have at least one regret about the home they bought (75%). About one-third of new buyers regret buying a home that needs more work or maintenance than expected (32%). A similar percentage regret buying a home that is too small (31%).
“The pandemic-driven feeding frenzy in the for-sale market added challenges for buyers, especially those purchasing for the first time,” said Zillow population scientist Manny Garcia. “This research suggests many of those buyers ended up in a home that was less than ideal. It’s important to remember that even in a balanced market, most buyers have to make compromises to stay within their budget. However, to minimize regret, aspiring buyers would be wise to establish where they’re willing to compromise and what’s a deal breaker before shopping.”
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Most successful buyers (74%) wish they had done at least one thing differently during the shopping process, with 38% wishing they had spent more time searching for a home or weighing their options. About one-quarter would have shopped for and purchased a home in a different area (28%).
A vast majority of successful buyers say they had to make at least one compromise in order to afford their home (81%). Nearly 2 in 5 say they ended up in a location that increased their commute time (39%), while 32% purchased a home that was smaller than they initially planned to buy.
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In Other Words
In other words, they wish they had a copy of Winning Mortgage, Winning Home before buying. Don’t ask “what, me worry.” Plan ahead and remove the worry.
Zillow study footnotes below.
i Zillow Group Population Science conducted a nationally representative survey of more than 2,000 people who purchased a home in the past two years or who intend to buy a home in the next 12 months. The study was fielded in November 2021. For the purpose of this study, “successful buyers” refers to people 18 years of age or older who own their primary residence that they purchased in the past two years. “Prospective buyers” refers to people 18 years of age or older who intend to buy a home in the next 12 months.