🏠 Housing’s sad paradox

…the US has come down with a weird case of housing blues [Disclosures](   A white-picket paradox (Jon Lovette/Getty Images)   Last Week’s Market Moves   Dow Jones 32,152 (+2.66%) S&P 500 4,067 (+3.65%) Nasdaq 12,112 (+4.14%) Bitcoin $21,223 (+6.48%) Dow Jones 32,152 (+2.66%) S&P 500 4,067 (+3.65%) Nasdaq 12,112 (+4.14%) Bitcoin $21,223 (+6.48%) Hey Snackers, It’s corn… bassador. 7-year-old Tariq went viral for his delightful [appreciation]( of simple corn cobs, in a song that lives rent-free in America’s head. Now he’s the [official corn-bassador]( of South Dakota, one of the biggest kernel-producing states. Spread corn, not scorn. Stocks surged last week, snapping a three-week red streak. The techy Nasdaq led gains, climbing 4.1%. On Thursday, J. Powell reiterated a hawkish ’flation-fighting stance (pain = still the name of the game). Meanwhile, the European Central Bank [hiked]( interest rates by 75 bps. Btw... Do you want to start getting Snacks daily? Or prefer to unsubscribe? Manage your subscription preferences [here](. Paradox The housing paradox: as rates rain on property’s parade, Americans are losing all around [Zillow]( has us pillow-sobbing… The US has come down with a case of housing blues: Americans are either sad because they can’t buy a house or sad because they did buy a house. Nearly three in four homebuyers have at least one [regret]( related to their recent home purchase. Meanwhile, wannabe buyers are getting priced out. Let’s unpack that: - Homeowners are watching their net worth [fall]( as soaring mortgage rates soften demand. Home prices dropped in July for the first time in 32 months as rates doubled from January. - #1 regret: overpaying. Buyers paid a median of $65K over asking price for their new cribs. - Meanwhile: Wannabe buyers are far from their white-picket-fence dreams because prices are still significantly elevated (blame: pandemic [housing boom](. “Squid Game” vibes… No one wins in this market. Prospective buyers lose: home prices in June were 18% higher than a year earlier, a historically steep jump (plus: mortgage rates are wild). Owners lose too: home prices dipped 0.77% in July — sounds negligible, actually the largest monthly decline since 2011. - The housing-price drop could get worse since the Fed is determined to unleash ’flation-fighting “pain” (read: higher interest rates). - 275K mortgage holders would fall underwater if their homes lost 5% of their current value. Over 80% of those borrowers bought homes in the first half of this year (aka: housing peak). THE TAKEAWAY It’s a chill, but likely not a crash… Homeowners are way more cash flush now than they were when the housing market crashed in ’07 (flashback: prices plunged and millions owed more than their homes were worth). Mortgage leverage is at a record low, and losing some paper value on a home won’t harm most Americans. While housing inventory is rising at a record pace, home supply is still relatively tight, so prices likely won’t crash. Zoom Out Stories we’re watching... Looks like a microwave on wheels… actually a robo burrito delivery (#roburrito). Last week [Uber Eats]( struck a 10-year deal with self-driving startup Nuro to deliver food starting this year. Nuro was the first to score street-legal status for driverless deliveries, and it has deals with [Kroger]( [Walmart]( and [Domino’s](. In June, Grubhub launched autonomous delivery at some colleges. Driverless drop-offs can ease labor shortages and curb emissions. With US online food deliveries set to grow 10% by 2026, self-driving could go mainstream through the kitchen. This cap's not for wearing… but winter is coming. After Russia’s Gazprom indefinitely [shut down]( natural-gas flows to Europe to compel the West to lift sanctions, Europeans are fearing a worst-case scenario winter energy crisis. Think: scarce supply, sky-high heating costs. Now: the EU proposed a cap on Russian gas prices, the new British PM Liz Truss announced a cap on home and business energy bills, and Germany announced a roughly $65B plan to offset soaring energy costs. The measures are meant to protect taxpayers from massive heating bills. Events Coming up this week... [Ethereum]( holds its breath… The second-largest cryptocurrency is expected to undergo a major overhaul — dubbed [the Merge]( — this Wednesday, and it's the talk of crypto town. If all goes to plan (fingers = crossed), ethereum's backbone will switch from "proof of work" (old, energy-hungry) to "proof of stake" (new, energy-efficient). But ahead of ETH's big day: experts are warning of [scams]( and miners are talking [hard forks](. Ethereum's future depends on the Merge going smoothly — only then will everyone involved breathe easy. $700 Balenciaga blazer… just for the night. Last quarter, [Rent the Runway]( doubled its sales as the return of IRL events boosted its biz. RTR offers clothes from 750+ designers for rent or purchase. But as #flation weighs on wallets, RTR is doubling down on secondhand fashion — which is forecast to double to $77B in sales by 2027. In July, Saks Off 5th and RTR [partnered]( to offer pre-owned designer pieces at stores and online. We’ll see how resale retail is paying off when RTR reports today. FYI: the [stock’s]( down 46% this year. ICYMI Last week's highlights... - [Spin]( Buzzy unicorn IPOs may be fading, but “spin offerings” are gaining traction. [Volkswagen]( plans to take [Porsche]( public in what could be Europe’s biggest IPO since 1999. VW could raise $10B in the listing. - [BTClean]( The White House dropped a report on crypto mining's environmental impact. Carrot: President Biden wants to work with the industry to go greener. Stick: If that fails, executive action (think: regulation) is on the table. - [Putinflation]( Europe is racing to fill gas-storage facilities to keep homes warm this winter after Russia-controlled Gazprom indefinitely shut the key Nord Stream pipeline, blaming Western sanctions. What else we're Snackin' - [Influence]( TikTok fame is big business. Forbes’ inaugural top-creators list highlights 50 social stars (think: Charli D’Amelio and Khaby Lame) who earned $570M last year influencing their combined 1.9B followers. - [Life]( Average life expectancy in America has fallen to about 76 years — the lowest level since 1996. Covid, gun violence, and chronic illness are some of the causes for the US falling behind countries like China. - [Coins]( China's new digital currency (#digi-yuan) could help it break its reliance on the dominant US dollar. As China positions the digi yuan for international use, countries could use it to evade American sanctions. Want your Snacks daily? The Daily Newsletter Get fresh takes on financial news every week day. Try a sample: ⛏️ [A White House crypto wish]( • Sep 9, 2022 🚗 [Initial Porsche Offering]( • Sep 8, 2022 ⛽ [Russia’s gas halt]( • Sep 7, 2022 [Subscribe to the Daily]( Snack Fact Of the Day 9/11 was the deadliest day in history for American firefighters [Read more]( This Week - Monday: Earnings expected from Oracle, Planet Labs, and Rent the Runway - Tuesday: Earnings expected from Core & Main - Wednesday: Earnings expected from Li-Cycle Holdings - Thursday: Hispanic Heritage Month begins. Jobless claims. Earnings expected from Adobe - Friday: Earnings expected from Manchester United Authors of this Snacks own: bitcoin and ethereum and shares of Walmart and Uber ID: 2419124 Robinhood Snacks newsletters reflect the opinions of only the authors who are associated persons of Robinhood Financial LLC (Member [SIPC]( and do not reflect the views of Robinhood Markets, Inc. or any of its subsidiaries or affiliates. 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