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Model Y now unaffordable for most of us

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I am a RE Broker in SoCal and I don't believe we are in a true bubble. If anything does "pop," prices will just stabilize a bit or plateau. It make homes that were unaffordable, still unaffordable, but it won't feel like you're rushing to put in a crazy high bid.

The prior 2008 bubble was caused due to poor lending strategies and an over building of homes. Basically if you had a pulse, the banks lent money to you to buy a home. Prices now are skyrocketing due to low rates, pent up demand, low inventory and people putting more importance on having a homestead where they can have space and work. Most loans these days are also all A paper / full doc loans. Also most deals are all cash as well. Not many subprime mortgages.

With the feds probably hiking up the interest rates this year, that may cause the RE residential market to lose some steam, but really, not a bubble where we will see 20-30% corrections. I wish it would be true but I'm not too certain. I represent buyers and sellers too and I'm also in the market to buy a bigger home as well. Times are tough for anyone wanting to buy a home for a deal, but my mantra is that I am not going to let prices dictate my life and put my life on pause. If I need a bigger home for my family (and/or a new Tesla), and I can afford it, I'll buy it.

If you DO want to invest in real estate and possibly get a deal, wait towards the end of the first quarter 2022 and look out for when the eviction moratorium ends. Lots of multifamily owners will be evicting their tenants and hopefully trying to get out of these types of buildings. If the states extend the EM, I'm sure lots of owner will also want to sell as the building probably isn't worth it to them at that point. Just my thoughts.

This is totally off topic, but I have a local real estate broker who I became friends with, and she believes (and I agree) that a lot of this pent up demand for homes is due to the shift a lot of people have had with "WFH" and "School from home" for almost the last 2 years.

When you spend so much time at home, you start to think "maybe I need XXXX" or "wow, I really didnt notice YYY because I was working all the time, but now that I am here....."

Given that a lot of the country is experiencing an actual shift in how work will be done going forward (as in, maybe 50/50 work or office, or more flexible working situations where that wasnt an option before), "Home" is going to continue to be more important to people than it was pre pandemic.
 
Maybe, likely sooner. The Dolphin has already sold over 30.000 in China, is shipping to Australia this quarter, and BYD is advertising for employees in the US.
Oh, maybe those guys, but the Tesla one... even if it's "coming soon," they have so much on their plate they need to push out the door, I doubt we would see volume production for a few years. I also think the cheaper smaller Tesla will show up in the EU and China first and then make it's way to the USA when production capacity (and cells) is at a surplus OR when they're really being attacked by lower price vehicles.
 
I bought my car a year ago for a lot less than it is now, and I'm not sure that I could (or rather would want) to afford the price it is at. And unfortunately, I am not sure that it will change any time soon. The inflation/supply chain issues are largely to blame, but at the end of the day, anything is worth what people are ready to pay for it, be it a Tesla, a drawing of a monkey, or a house.

And as long as Tesla will be number 1 as far as tech and charging network, this trend probably won't change. Add to that that there is a cult around Tesla and Elon, similar to the one around Apple products, I am not sure that prices will go down ever, as there will be people ready to put their money in a product slightly superior less than 18 months after buying the previous version.

If I was shopping today, I would probably hold off and try to wait another 1-2 years. The Tesla prices might not go down, but the competition is introducing some serious contenders that will likely make "affordable" EVs more "affordable" once the supply catches up to the demand.
 
This is totally off topic, but I have a local real estate broker who I became friends with, and she believes (and I agree) that a lot of this pent up demand for homes is due to the shift a lot of people have had with "WFH" and "School from home" for almost the last 2 years.

When you spend so much time at home, you start to think "maybe I need XXXX" or "wow, I really didnt notice YYY because I was working all the time, but now that I am here....."

Given that a lot of the country is experiencing an actual shift in how work will be done going forward (as in, maybe 50/50 work or office, or more flexible working situations where that wasnt an option before), "Home" is going to continue to be more important to people than it was pre pandemic.
Funny you say that. That was exactly my family's mentality. My wife is an exec at Disney Corp and when the studio decided that her dept would be WFH mainly with an optional 2 days a week office visit, now indefinitely suspended due to Omicron, we decided that we would spend all the money we saved commuting and going on trips on finding a home near the SoCal beaches.

The subject of this matter may not be off topic, but it's the same with the prices of all the cars like the Model Y going up in price, right? People are putting their hard earned money into nicer bigger things so they can enjoy their lives a bit more and appreciate the world. I hear of a phenomenon called the "great resignation" where people are quitting their jobs so their quality of life can be better. But I digress...to the OP, the Tesla is still probably a better deal as

YOU

KNOW

WHAT

THE

EXACT

PRICE

WILL

BE.

For any other car out there, esp the other EVs, you are at the mercy of the dealership to reduce or nego their markup. You're getting the deal of the century if you get it at MSRP within a reasonable driving distance from your home. If you want a good deal, chance are you are going to have to fly somewhere and risk getting Covid. I find that very stressful. The Model Y is an expensive car. The MY performance is even more, but I knew exactly the price it was at and decided to buy it at that time when I knew exactly what the price was.
 
In phases. Like in the past, they sell top trims first. Revenue brought in from that helps make the lower trims.

Tesla plans on making an even more affordable model in the near future at an estimated cost of around $25k. Will it stick to that price when it's close to production? Time will tell. You got Honda civics in the 30k range (non type r). Eventually Tesla more than likely will reach the masses. The current market has made that a bit of reach for some who are in the market for an EV but there are other options coming that will give tesla some competition which should ultimately drive the cost down of some cars or just come up with more affordable models. Patience.
The whole produce an expensive car to pay for manufacturing an affordable car was over when they made the Model S to make the Model 3. They never sold that $30k Model 3 for long or the SR Model Y. When you're worth 1 Trillion dollars, the small business underdog tag goes away. They can produce cheaper Model 3s and Model Ys, they just don't want to because the profit margin is less. Hence, they are no longer the company to produce cheap EVs for the masses.

When you consider 6% inflation and the cost of the improvements that have become standard equipment, I think the price increase is fair. Some may want to wait for the 'EV for the masses' that Elon has been talking about.
The Model Y went up ~16.5% during the year in 2020. You believe the 6% inflation and improvements are the reason for the price increase? It has nothing to do with the BBB Bill that was in the works at the time?
 
I am a RE Broker in SoCal and I don't believe we are in a true bubble. If anything does "pop," prices will just stabilize a bit or plateau. It make homes that were unaffordable, still unaffordable, but it won't feel like you're rushing to put in a crazy high bid.

The prior 2008 bubble was caused due to poor lending strategies and an over building of homes. Basically if you had a pulse, the banks lent money to you to buy a home. Prices now are skyrocketing due to low rates, pent up demand, low inventory and people putting more importance on having a homestead where they can have space and work. Most loans these days are also all A paper / full doc loans. Also most deals are all cash as well. Not many subprime mortgages.

With the feds probably hiking up the interest rates this year, that may cause the RE residential market to lose some steam, but really, not a bubble where we will see 20-30% corrections. I wish it would be true but I'm not too certain. I represent buyers and sellers too and I'm also in the market to buy a bigger home as well. Times are tough for anyone wanting to buy a home for a deal, but my mantra is that I am not going to let prices dictate my life and put my life on pause. If I need a bigger home for my family (and/or a new Tesla), and I can afford it, I'll buy it.

If you DO want to invest in real estate and possibly get a deal, wait towards the end of the first quarter 2022 and look out for when the eviction moratorium ends. Lots of multifamily owners will be evicting their tenants and hopefully trying to get out of these types of buildings. If the states extend the EM, I'm sure lots of owner will also want to sell as the building probably isn't worth it to them at that point. Just my thoughts.
Not looking to Invest, home to live in :). Bubble will Pop(not like 2008 of course), Chinese Real estate market is in crisis atm and some of that will probably affect over here a bit, raising interest rates, foreclosures etc coming soon also. Hoping to get down to 2016 pricing but noone knows :) Going to rent a house till then. Can't afford prices atm, if gets to the 400k in the area I want then I'll pull trigger. I have the 20% down already.
 
It has nothing to do with the BBB Bill that was in the works at the time?
Not nearly so much as the hopeful folks who ordered believing that Uncle Sugar would take some of the sting out of the price tag. We're barely halfway through January and Tesla already has orders most of the vehicles it's likely to build this year, even with a ton of price increases. Without those price increases, what would the backlog look like? If folks weren't complaining about price increases, they'd most likely be complaining about a two-year wait time instead.
 
Me, neither. 2008 was such a blast. I loved how nobody was stressing about the economy in 2009-10, too!
Yes 2008 was a bubble.
But here we are in 2022 and prices are even higher than pre 2008.
Either you need time it right, or you just need to sit and wait and you will still make money on real estate.
Of course it depends where you buy. Some markets rebounded pretty well, some like Charm City (AKA Baltimore) barely at pre 2008 levels.
So even if we are waiting for a bubble, there will be the next one coming.
 
Yes 2008 was a bubble.
But here we are in 2022 and prices are even higher than pre 2008.
Either you need time it right, or you just need to sit and wait and you will still make money on real estate.
Of course it depends where you buy. Some markets rebounded pretty well, some like Charm City (AKA Baltimore) barely at pre 2008 levels.
So even if we are waiting for a bubble, there will be the next one coming.
Not trying to make money :)
 
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If the standard model Y had never been brought to market, I would have never gotten a tesla. I wanted a 40k EV SUV CUV whatever the hell a model Y is and didn't need an LR at the 49k price tag early last year.
Same. I'm selling my base model MYSR and upgrading to a MYLR. Only way I could ever afford a MYLR. Got an offer for $55k for the MYSR and ordered the MYLR back in July when it was $52,9k, so after red multicoat, documentation & destination, it's about $1k more (before tax). Was waiting for BBB until it got nuked, and then was pushing it back as much as I could to get Ryzen (which I got). Worth it!
 
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Tesla should increase the production of model Y in a big way this year with Texas and Germany factories coming on line. One may hope that prices may come down a bit next year after those factories ramp up. If the chip shortage disappears (maybe one day), then there should be plenty of non Tesla offerings available at MSRP. More competition will lower prices, however that may not materialize until 2023...
 
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Not everyone needs a Tesla Model Y. The problem is people complain about things they can't afford that they want. People don't need a brand new iPhone every year, yet people complain about the price and still purchase it. There are many things in life you don't need. A Tesla isn't a budget vehicle.

Just for good measure I went over to the rolls Royce forum and complained on there that the prices are stupid and I can buy a model Y for 1/10th the price and I am NOT buying a rolls Royce until they get this back under control.
I think you are misunderstanding the point of the OP’s original post. Tesla went from having affordable models to being unaffordable. They had a $30k Model 3, and a sub $40k Model Y. But over the course of the year raised their prices by quite a large amount and got rid of their affordable Model 3 and Y. Making them unaffordable to a lot of folks in the name of profit.
It’s not like Rolls Royce or Lamborghini where it’s just for the filthy rich.
 
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I think you are misunderstanding the point of the OP’s original post. Tesla went from having affordable models to being unaffordable. They had a $30k Model 3, and a sub $40k Model Y. But over the course of the year raised their prices by quite a large amount and got rid of their affordable Model 3 and Y. Making them unaffordable to a lot of folks in the name of profit.
It’s not like Rolls Royce or Lamborghini where it’s just for the filthy rich.

The model 3 was never 30k and where was this sub 40k model Y? The absolute cheapest model 3 SR was 35k, only really available off menu, and only for a short period of time.

I understand the point you are making, but those are some fairly large exaggerations.
 
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