Respectfully, the spigot of US oil has not been shut off, and this year, American oil production reached a record high of over 12.8 million barrels a day. This is simply a fact, and it can be verified easily.

In the last three weeks, the price of oil on the open market has fallen precipitously. On 9/18/2023, the price of a gallon of regular gas on the market was $2.70. On 10/6/2023, the price of a gallon of regular has plummeted to $2.19. That is a 19% loss in 3 weeks time. When the price of gasoline moves like this, it's obvious that the market is based on a lot more than American oil output. There is lots of speculation in that price. And estimates of future demand. A report came out that American gasoline demand is at its lowest point in 22 years. Another report showed crude oil stockpiles growing by 6.5 million barrels. Demand is way down. Since it's denominated in US dollars, part of the price is the strength of the American greenback, which has been increasing, not decreasing. That huge market decrease should start to show up at the pumps fairly soon....it takes some time but if gasoline futures stay here, we should see a significant drop in gas prices at the pump pretty soon. However, with the sad events this weekend in Israel, it is unknown how that will affect the markets.

I, for one, totally get what you are saying

Supply
 

Inventory is the key for the housing market too. National inventory is up to 7 months according to FRED. Anyone that tells you that doesn’t matter here in The Villages is a liar. Many want to sell before they buy etc. Another issue is the ever climbing inventory locally which likely won’t slow anytime soon.

Did you get that info from a government publication or by visiting your local gas station?

Don't forget about property taxes. Taxes on my 20 year old $410,00 are $6,000/year.

Not sure where you're getting your numbers. Gas here in southern Indiana hasn't been anywhere near that since Trump was in.
The cheapest around here is 3.29 and it hasn't been below $3 for a long time.

I'm not a big Trump guy, but I do know when he was in, gas was cheap and the economy was on fire.

Agree, as my mortgage that I took was 2.5%.

I sold a two year old home I built here in TV for almost twice what I paid for it in March this year. I’m in a new Village now of 1100 homes where’s there’s only 6 left. I think sales are going quite well here in TV.

It's not info from a government publication. It is the daily closing price on the publicly traded commodity market. RBOB, which is the trading symbol for regular gasoline (it actually stands for Reformulated Blendstock for Oxygenate Blending). This is the grade of gasoline used for futures contracts on the public traded commodity exchanges. If you were long on the futures of gasoline over the past month, you got clobbered and if you played it short, you made a big return in a short period of time.

It usually takes some time for the commodities price to work its way down to the pump. Unfortunately, it takes longer for price drops than when the price is going up.

As an aside, the entire oil market has gone down. I keep track of the guaranteed home heating price offered by my oil company. Gasoline is one thing, but we go through 850-900 gallons of home heating oil a year in CT and the price of home heating oil is far more impactful to us than gas prices. In the space of one week, there was substantial decline in the fixed price I could contract to buy oil for the remainder of the winter, going from $4.179 to $3.859. That's a 7.7% drop in five days, pretty significant. Even at the lower price, that's still close to $4,000 a year with the service contract included....I won't miss paying that if we ever move full-time to FL.

All of this could easily change this week due to the situation in Israel. The oil markets do not like geopolitical events or uncertainty, particularly in that region of the world. Oil could go right back up.

It's the commodity price per gallon on the futures market, not the price at the pumps. The gasoline still has to get transported, there is usually a distributor who has their profit built in, the gas station has to make their profit per gallon, and there are federal and state taxes that get added to the cost to make the price at the pump. However, when the underlying cost of gasoline decreases by 50 cents a gallon, a good portion of that will work it's way to the pumps.

As I said elsewhere, who knows where the oil markets go tomorrow, however....

As of 9/18/2020, the average price in the US was $3.88...

Nowhere near $2.19

Gas prices hit 2023 highs as oil stays hot | CNN Business

So was the national debt….:duck:

During the 3 years before COVID, GDP growth averaged 2.5% - this is "on fire"?

As of December 2019, it was 3.18%, the highest it had been since 2004...

Oh, I forgot to add... The average GDP for years ending 2017, 2018, 2019 (the 3 years before Covid) was 2.97%, not 2.5%

US Real GDP Growth Rate by Year

Revenue has also climbed. We were steady till about 2018 at about 4trillion. This year’s revenue should top a little over 5 trillion dollars. To bad the government still spends like drunken sailors.

Don't know how you get a 2.97 average from 2.99, 2.12 and 3.18. It comes out to a 2.76 average whether arithmetic or geometric. Still not "on fire" compared to Reagan and Clinton years.

When I purchased my first home in 1983, I was told by a savvy real estate investor, "Property is usually too expensive on the day you buy, and in 10 years, you'll wish you had purchased a dozen of them." I doubled my money in 5 years. There will always be those who are priced out of the market. That does not make the market bad or evil. You should buy what you can afford.

Yes, the economy was on fire due to low energy costs and more well paying jobs than there were people to fill them. A big Toyota plant near me was begging for workers and so were the trade unions. All great paying jobs.

I work selling food for Sysco to restaurants (retiring in 4 weeks), My business was rocking during those years.

Yes Reagan and Clinton had great economies, but I've never seen a time like 17,18 and 19. So many high paying jobs and employers competing for workers. It was even happening in my industry.

Many great points to this post. I have enjoyed reading all of them. There is nothing wrong with the housing market pricing according to rates and making TV what it was just a few years ago a quiet and happening place to live with likeminded retirees enjoying the fruits of their labor. I am pleased to see so many different opinions about so many related issues. Feel blessed in your life in TV and I look forward to living full time myself within a couple years. Until then I will continue to enjoy my visits. Keep up the posts I will read them all. Have a Wonderful Day!

Rbob
 

Few different bunny trails.

You never know what is going to generate 100 posts.

:BigApplause:

Round-a-about threads come close. :wave:

That is all based upon the assumption that there is no abnormal event your assumed risk profile of your investments can't withstand. Investments are an inherently risky holding, and assuming that the current rates and levels will continue through the life of the decision is the uncertainty that many people do not want to take.

I want the house free and clear, and not have to assume that all my investments can withstand any unforeseen event. I have lost everything once, that is not happening again, and I am not the only one who can get surprised by unforeseen events.

remember, as with all things in life, everything works fine, until it doesn't.

As I have been patiently trying to explain, the price I am quoting is the price on the commodities market for gasoline futures. As I said repeatedly, it takes time for the price of gas futures to make its way down to the price at the pumps. The bottom line is the underlying cost of gasoline went down 51 cents a gallon in 3 weeks. The price I quoted was the accurate price of RBOB futures on that date, you can easily look it up and verify that.

By the way, futures are up .06 already tonight to $2.25 per gallon due to the events in Israel....The price of oil is up by over $2 a barrel....there are two main types of oil that trades in futures contracts...Brent North Sea Crude, and West Texas Intermediate.....Brent always trades a little higher than the Texas oil....

We are at the age where you invest in low risk investments.

Most people that are even moderately savvy with with finances would consider that a misguided take to be honest especially if their mortgage rate is 3-4%. You can beat that rate moderately with a variety of extremely safe investments currently, and beat it by a lot long term invested in index funds.

It's better to optimize your money than have it 100% tied up in real estate making you zero returns. Many of the world's billionaires don't own most of their homes outright.

2 retired teachers and the villages
 

We are 2 retired teachers that came to the Villages in 2019. If we had to buy our home now it would cost more than what we paid in August 2019 when we bought it. But the home we sold in 2019 also has gone up in value so to me it would be a wash. We would have received more from the sale of the home and bought in TV at today's prices. I am not sure what the author of this thread is getting at. The prices have risen here but that is true of many places. I can sell my home in TV for more than I paid for it. So why do they think buyers wouldnt be able to afford now and what is the point about falling prices?. Given the majority of people are selling a home and then rebuying here don't the prices cancel out.? Mortgages cost more now but a lot of people who sell their homes to buy here dont depend on getting a mortgage. I dont agree with the thread author.

Why is it a good thing for an asset I own to come down in price/value so somebody else can afford to move here? Makes no sense at all!! That’s like saying it’s ok for my Apple stock to tank so somebody else can buy shares. I want all my assets to grow in value, and if somebody can’t afford to buy in this market, then they should look elsewhere

Ours was 12 3/8% and we felt lucky to get that!

That's an investment decision............NOT what I'm talking about.

Love the billionaire justification. :1rotfl:

There you go again....................Sound financial advice / experience.

Are you a sales agent for The Villages? I’m wondering how you got these numbers for current preowned and new homes?

...

I don't know how anyone could argue with your logic , I have no qualifications as a financial planner but I think anyone so qualified would advise anyone buying a home to take advantage of the dramatically low 30 year interest rates , risk is unavoidable, home ownership has been historically a low risk proposition, that's why mortgage rates are lower than most other types of credit, when you take a mortgage at a 2 to 3% area the entity providing the funds are taking all the risk, anyone one would be much better off taking as large a mortgage as their cash would allow

Agree.

My designer home has doubled in value since I purchased it in March of 2020!

Sell Now
 

Sell it now. Redfin just released data determining that demand for housing in Florida is at a 7 year low! Cash in while you can. We are just entering crash mode. Just look at the Villages website for homes. Things are starting to look ugly.

According to the demographics that the Daily Sun sends out to advertisers, over half the sales are paid in full without a mortgage.

Think about it - you bought a house up North, in the '70's for $40K. You are much older, the kids are on their own, you can't stand the cold, etc. so you sell for about $700K and, after expenses, you net $600K profit. The first $500K is non-taxable so, you pay $20K tax on the remainder. You now have $580K - plus savings - to spend for a new house in a warmer climate.

Put 50% to 65% down, get a very low interest, pay what the higher interest rate required and you can be mortgage free very quickly.

VA loan 2.399% 30 year fixed
 

Not if your mortgage rate is 2.399% and you’re earning 8 % on the money you didn’t use to pay cash for a home . It’s called smart not sad . Plus you can write off interest and taxes .and any energy efficient equipment you add to your home .

Dude, that's an investment decision...........not what I'm talking about.

If you want to leverage, leverage.............I don't care.