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Case Shiller Confirms Housing Double Dip Accelerated, 20-City Composite At Lowest Since June 2009

Tyler Durden's picture





 

As of December, so almost three months ago, the housing double dip was getting increasingly worse. This was confirmed by the latest Case Shiller data, according to which the 10- and 20-City Composites posted annual rates of decline of 1.2% and 2.4%, respectively. The 20 City Composite printed at 142.16, the lowest since June 2009 when it was 141.75. Luckily, NAR's now completely disgraced Larry Yun is nowhere to be found in this release, from which we quote: "Data through December 2010, released today by Standard & Poor’s for its S&P/Case-Shiller1 Home Price Indices, the leading measure of U.S. home prices, show that the U.S. National Home Price Index declined by 3.9% during the fourth quarter of 2010. The National Index is down 4.1% versus the fourth quarter of 2009, which is the lowest annual growth rate since the third quarter of 2009, when prices were falling at an 8.6% annual rate. As of December 2010, 18 of the 20 MSAs covered by S&P/Case-Shiller Home Price Indices and both monthly composites were down compared to December 2009." Bottom line: the chart says it all.

Those hoping for some soothing Kool Aid will not find it in the following quotes:

“We ended 2010 with a weak report. The National Index is down 4.1% from the fourth quarter of 2009 and 18 of 20 cities are down over the last 12 months. Both monthly Composites and the National Index are moving closer to their 2009 troughs. The National Index is within a percentage point of the low it set in the first quarter of 2009. Despite improvements in the overall economy, housing continues to drift lower and weaker.” says David M. Blitzer, Chairman of the Index Committee at Standard & Poor's. “Unlike the 2006 to 2009 period when all cities saw prices move together, we see some differing stories around the country. California is doing better with gains from their low points in Los Angeles, San Diego and San Francisco. At the other end is the Sun Belt – Las Vegas, Miami, Phoenix and Tampa. All four made new lows in December. Also seeing renewed weakness are some cities that were among the last to reach their peaks including Atlanta, Charlotte,  Portland OR and Seattle, where news lows were also seen. Dallas, which peaked late, has so far stayed above its low marked in February 2009.”

“The 10- and 20-City Composite indices remain above their spring 2009 lows; however, 11 markets – Atlanta, Charlotte, Chicago, Detroit, Las Vegas, Miami, New York, Phoenix, Portland (OR), Seattle and Tampa – hit their lowest levels since home prices peaked in 2006 and 2007. We have seen more markets hit new lows in each of the past three months.”

“Looking deeper into the monthly data, 19 MSAs and both Composites were down in December over November. The only one which wasn’t was Washington DC, up 0.3%. With December 2010 index levels of 99.73 and 99.48, respectively, Cleveland and Las Vegas have the dubious distinction of average home prices now below their January 2000 levels. Detroit was the only market that was in that group prior to December”

Full report.

 


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Tue, 02/22/2011 - 10:12 | Link to Comment Caviar Emptor
Caviar Emptor's picture

Biflation bitchez!

Tue, 02/22/2011 - 10:21 | Link to Comment Stuart
Stuart's picture

Stagflation bitchez!

Tue, 02/22/2011 - 10:23 | Link to Comment Caviar Emptor
Caviar Emptor's picture

Not! Stagflation was a term designated to describe the 1970s, a time when housing prices were skyrocketing. Clearly not the case in this economy. Also in the 1970s wage inflation was considered a key cause of general inflation. Clearly not the case today. And sequential GDP growth was higher then 

Tue, 02/22/2011 - 10:26 | Link to Comment DonnieD
DonnieD's picture

It's not any kind of -flation. It's a bubble popping and price normalization. Someone tell the Fed their job isn't to reflate bubbles. The sheeple actually like it when 60% of their take home pay doesn't go to their mortgage.

Tue, 02/22/2011 - 10:43 | Link to Comment Haywood Jablowme
Haywood Jablowme's picture

Bi-Stagflation biznitches...

 

Tue, 02/22/2011 - 11:02 | Link to Comment Overflow-admin
Overflow-admin's picture

It's Global-flation!

Tue, 02/22/2011 - 10:35 | Link to Comment Quinvarius
Quinvarius's picture

Stagflation is when unemployment and inflation are high.  Like now.

Tue, 02/22/2011 - 10:44 | Link to Comment Caviar Emptor
Caviar Emptor's picture

Stagflation does not adequately describe what is going on today. Wrong diagnosis will engender wrong treatment. This is not like the 1970s stagflation which Ben's idols, Milton Friedman, Volcker and Greenspan made their careers out of dealing with. If we fail to recognize the key distinctions, then the economy will go even further south since the treatment is now aggravating rather than helping the problem

Tue, 02/22/2011 - 10:22 | Link to Comment bankrupt JPM bu...
bankrupt JPM buy silver's picture

Who cares, Ben is here.  And didnt you know?  The economy is self sustaining now! 

 

www.silvergoldsilver.blogspot.com

Tue, 02/22/2011 - 13:22 | Link to Comment Zero Govt
Zero Govt's picture

Ben's simply not blowing asset bubbles hard enough ...blow Ben, blow.....

Deflation Benny-Bitchez, Deflation

Tue, 02/22/2011 - 10:56 | Link to Comment bankonzhongguo
bankonzhongguo's picture

Considering how much Case-Shiller is used in housing futures, it should come as no surprsie that it is as inflated as BLS numbers.  People just like to say "Case-Shiller."  It makes it sound very important.  A ton of data is missing in these indices.  Right now I can think of 10 pocket listings in my home town that never made it onto MLS and therefore the 10-30% cash discounted sales prices will never make it on anyone's radar as sold comps - and you use known comps to write the offers.  Market still overpriced 20% never mind the 2 year shadow inventory.  Look to the local rents for value.

Tue, 02/22/2011 - 10:13 | Link to Comment papaswamp
papaswamp's picture

As more sink underwater. Round 2 of the walk-away fest?

Tue, 02/22/2011 - 10:13 | Link to Comment 101 years and c...
101 years and counting's picture

This was before mortgage rates hit 5%.  Can't wait to see the next 3 months' of data.

Tue, 02/22/2011 - 10:15 | Link to Comment youngman
youngman's picture

"Can't wait to see the next 3 months' of data"

 

From who?  lol

Tue, 02/22/2011 - 10:14 | Link to Comment longjohnshorts
longjohnshorts's picture

Buy low, sell lower.

Tue, 02/22/2011 - 10:33 | Link to Comment snowball777
snowball777's picture

Rent now, buy cheaper later.

Tue, 02/22/2011 - 10:45 | Link to Comment apberusdisvet
apberusdisvet's picture

"buy cheaper later".  I agree, but the bottom is nowhere in sight.  A declining universe of qualified borrowers, more stringent LV ratios, income standards, etc plus rising interest rates indicate to me that the current median home price of $168K has to drop to the $120 level.  The other metric is the median family income, now at slightly less than $50k and dropping.  When that number reverses, it will be time to buy; but definitely not until then.

Tue, 02/22/2011 - 10:57 | Link to Comment SteveNYC
SteveNYC's picture

Ding Ding Ding Ding Ding Ding!!!!

We have a winner, great call.

Tue, 02/22/2011 - 11:17 | Link to Comment swmnguy
swmnguy's picture

Absolutely correct.  Both the call, and recognition of the call.

Tue, 02/22/2011 - 11:32 | Link to Comment snowball777
snowball777's picture

Yes, the bottom is years away with current inventory and qual buyer scarcity, but I expect (maybe just hope) those rates will drop back to mid 4s before the -30% trough is reached.

 

Tue, 02/22/2011 - 22:48 | Link to Comment StychoKiller
StychoKiller's picture

What goes down, must come out.  Numbers so bad that denial becomes non-functional.

Tue, 02/22/2011 - 10:16 | Link to Comment Dexter Morgan
Dexter Morgan's picture

I thought the recession was over!

Tue, 02/22/2011 - 13:38 | Link to Comment Zero Govt
Zero Govt's picture

that'll be Steve Liesmans CNBC 'happy data'  ...it's Rick Santelli that's the sane one

Tue, 02/22/2011 - 10:17 | Link to Comment redarrow
redarrow's picture

It will not rise again for another decade. Of course unless Ben's printers just decide to buy the entire inventory to stimulate the economy.

Tue, 02/22/2011 - 11:03 | Link to Comment duo
duo's picture

"Dallas, which peaked late".  LOL.  My house (in a nice neighborhood) is still worth less than it sold for in the 1985 RE bubble here.  You would have been better off buying gold!

Tue, 02/22/2011 - 10:17 | Link to Comment Confused
Confused's picture

No one saw this coming.

 

</sarcasm>

Tue, 02/22/2011 - 10:21 | Link to Comment Fearless Rick
Fearless Rick's picture

+0 down, no-doc, interest only ARM.

Tue, 02/22/2011 - 13:28 | Link to Comment Zero Govt
Zero Govt's picture

fantastic deal isn't it? ..backed by Freddie Mac (bankrupt), Wall Street (bankrupt) and the US Govt (bankrupt)...

...what could possibly go wrong!

Tue, 02/22/2011 - 14:56 | Link to Comment GreenSideUp
GreenSideUp's picture

I think you forgot The People (bankrupt)

Tue, 02/22/2011 - 10:18 | Link to Comment Id fight Gandhi
Id fight Gandhi's picture

Whens uncle sucker gonna come up with a no money down, no interest payments until 2015 or some other kind of gimmick?

Print away more tax payer money to pump a busted bubble.

Tue, 02/22/2011 - 10:34 | Link to Comment snowball777
snowball777's picture

The Fannie and Freddie announcement wasn't enough to scare kids back into the pool?

Tue, 02/22/2011 - 11:06 | Link to Comment onarga74
onarga74's picture

Better yet he could have the banks bend over by resetting everyone's credit score to 750 for 5 years.  If they keep it there all debts relieved, if they don't losers for life.  Makes more sense than buying overvalued stocks while the whole world is still correcting.  This guy has an odd title for his website but knows where everything is falling apart and why.  In other words the boom in earthquakes isn't done yet.

http://theextinctionprotocol.wordpress.com/

 

 

Tue, 02/22/2011 - 10:19 | Link to Comment Quintus
Quintus's picture

There you go using the term 'Double Dip' again.  When did the first dip end?

Tue, 02/22/2011 - 10:34 | Link to Comment snowball777
snowball777's picture

The graph above says mid-2009...note the use of the word 'Housing' in the headline.

Tue, 02/22/2011 - 10:20 | Link to Comment Caviar Emptor
Caviar Emptor's picture

Oil hot, housing not. 

That's core biflation. It's why headline CPI looks so good! Housing drags down consumer inflation numbers in the calculation. But buying power is cratered and middle class existence is getting vaporized. While America sleeps, half the middle class will slide into the lower part of the pyramid. No more 'bulge in the middle'

Tue, 02/22/2011 - 10:19 | Link to Comment SheepDog-One
SheepDog-One's picture

Things you own plumeting down (less PM's),  things you need to buy rocketing up. Biflation!

Tue, 02/22/2011 - 10:19 | Link to Comment morph
morph's picture

Well this seals QE14.

Tue, 02/22/2011 - 10:20 | Link to Comment the not so migh...
the not so mighty maximiza's picture

They should start using roman numerals, it just looks cooler.

Tue, 02/22/2011 - 10:21 | Link to Comment Cleanclog
Cleanclog's picture

No surprise here.  But it is a FAIL for the Bernank, who wanted all asset values to rise, not just stocks.  If housing prices had risen, then the consumer really would have had more confidence and become spenders again.  However, the ridiculously high prices seen in housing before the bubble burst back in 2005 will only be seen with much more dollar devaluation.  And we'll feel poorer.  So Bernank is in a box on this - which is why you never hear him talking about housing prices anymore.  Unemployment a tad, but not housing.

Tue, 02/22/2011 - 10:30 | Link to Comment John McCloy
John McCloy's picture

Exactly. Also further proof regarding how false those home prices were all along. They were inflated long enough to create temporary profits for Wall Street and a mess in CDOs and CDS.
Wages are stagnatating
Savings and equity account wealth was vaporized
Credit scores destroyed
Constate job loss and job exportation
Already tangled buyers who are treading water in underwater homes from the past bubble
Record housing inventory
0% savings at banks for the middle class
And rated with nowhere to go but up. Even this record intervention could not budge home prices.
Oil was also not at 80/90 while the bubble was forming.

He is in a box alright.

Tue, 02/22/2011 - 10:21 | Link to Comment Ragnarok
Ragnarok's picture

OT: Four Americans Aboard Yacht Captured by Pirates Reportedly Killed

 

http://www.foxnews.com/world/2011/02/22/americans-aboard-yacht-captured-...

Tue, 02/22/2011 - 10:27 | Link to Comment Fearless Rick
Fearless Rick's picture

If this is true, then no mourning for them. These people knew full well they were heading into dangerous waters on their self-proclaimed "mission" to deliver bibles to people around the world, direct from their 72-foot yacht.

They told friends they were going radio silent so as not to alert the pirates to their location. Sorry, but these people were just plain stupid, bordering on delusional. Like what the people on the Horn of Africa really need is bibles.

Good riddance. Saved the country some tax dollars rescuing them.

Am I bitter. No, just realistic.

Tue, 02/22/2011 - 10:35 | Link to Comment Ragnarok
Ragnarok's picture

I don't care what they were doing just wondering what the US response to this will be. A stiffening of posture, or bury in the headlines?

Tue, 02/22/2011 - 10:36 | Link to Comment snowball777
snowball777's picture

+ Mark 8:34

Tue, 02/22/2011 - 10:39 | Link to Comment Confused
Confused's picture

+ 72 feet of luxurious final resting place

Tue, 02/22/2011 - 10:47 | Link to Comment John Law Lives
John Law Lives's picture

The loss of life is unfortunate, but yachting in those waters is pretty damn dumb.

Tue, 02/22/2011 - 10:50 | Link to Comment I Got Worms
I Got Worms's picture

Damned fools. Story is fishy though, they were probably spooks posing as bible thumpers. In any event, won't shed any tears for folks galavanting all over the uncivilized world - gotta save those tears for the people dying right here in the continental U.S.A.

Tue, 02/22/2011 - 10:52 | Link to Comment Richard Head
Richard Head's picture

It's crazy to cruise around in a target like that unarmed.

Tue, 02/22/2011 - 11:11 | Link to Comment MachoMan
MachoMan's picture

No shit.  I guess they weren't snake handlers...

Tue, 02/22/2011 - 11:37 | Link to Comment gaoptimize
gaoptimize's picture

Some people at AR15.com were going to buy a retired Coast Guard cutter at auction in shares and take a "bring your own weapons and ammo" cruise to the coast of Somalia.  If it happened, that would be a reality show I would watch.

Tue, 02/22/2011 - 22:52 | Link to Comment StychoKiller
StychoKiller's picture

All right!  R. Lee Ermy as "Captain Blood",  Ooorah!

Tue, 02/22/2011 - 10:21 | Link to Comment Caviar Emptor
Caviar Emptor's picture

Only Gold and Silver can protect your crumbling buying power. Ben's policies will only crater the value of your cash, income and property

Tue, 02/22/2011 - 10:22 | Link to Comment Stuart
Stuart's picture

more, mo powa, mo powa...

 

 

Tue, 02/22/2011 - 10:25 | Link to Comment lizzy36
lizzy36's picture

For a recession that ended in June of 2009, this sure is a shocker.

Tue, 02/22/2011 - 10:31 | Link to Comment Kaiser Sousa
Kaiser Sousa's picture

"the recession ended n 2009 dammit"...

repeat it until u believe it...dammit

Tue, 02/22/2011 - 11:50 | Link to Comment Problem Is
Problem Is's picture

It's a good thing Obummer:

"broke the back of the recession..."

The State of the Union and Other Idiotic Statments
Jan. 27, 2011

Tue, 02/22/2011 - 10:26 | Link to Comment reader2010
reader2010's picture

Perpetual QE.

Tue, 02/22/2011 - 10:30 | Link to Comment virgilcaine
virgilcaine's picture

Jumbo and "Prime" loans  are resetting now - 2012.. going to be bad. Places in Ca and Seattle once thought immune are getting hit.

Tue, 02/22/2011 - 10:40 | Link to Comment snowball777
snowball777's picture

One man's pain is another man's opportunity. CA RE has been ridiculous since the early 80s...gravity is a bitch, Icarus.

Tue, 02/22/2011 - 11:03 | Link to Comment francis_the_won...
francis_the_wonder_hamster's picture

The problem, for me at least, is that CA real estate prices are not correcting.  The place I rent for $2750/month is still listed for sale at $1.15 million, and that doesn't include the $425 in HOA's and annual assessments.  This is in San Diego, and most of the coastal towns here are similarly still living in denial of fundamentals.  There never was a correction in this area, as speculators abound to pick up any "distressed" home.

Tue, 02/22/2011 - 11:41 | Link to Comment snowball777
snowball777's picture

I'm just south of SF along the coast (similar to Carlsbad, in your neck of the woods) paying $2k (about $400 under market) for a place that would list around $500k (and sit there like a pet rock). Sometimes I look at other depressed areas like LV and Detroit and daydream about buying a place for cash with what I'd use here for a downpayment, but there are precious few places where I can earn the same. It's a waiting game, no doubt, but the wind is at our backs and I enjoy watching RE and bank vermin squirm in the meantime.

Tue, 02/22/2011 - 12:50 | Link to Comment francis_the_won...
francis_the_wonder_hamster's picture

Interestingly, I just received an email listing for a condo in the same complex where I live.  The place is almost identical to the one I live in (2 bed 2 bath...all modern), with the exception that I have a direct ocean view.  This listing just dropped from $625k to $575k.  It rents for $2450.  Would you pay almost $500k more for an ocean view?  I'm paying an extra $300/month for the view and think it's worth it......but let's be serious....$500k difference to live 200 yards closer to the beach?  Over half of the residents at this complex bought in the 1970's and are over 70 years old....when they pass away, their kids can't afford the taxes and HOA's....it could get interesting.

I get what you mean about moving elsewhere and getting rid of the overhead costs.  I probably could do so, and might in the future, but I love where I live and am willing to foot the bill (to rent, no to own).  The question is, will everyone else feel that way as the CA RE market finally starts to really correct.....I guess I should re-state that as the inland areas (Riverside County etc..)have already corrected.......When coastal California corrects, it will be interesting.

Tue, 02/22/2011 - 12:14 | Link to Comment Rainman
Rainman's picture

Correct. CA still has over $600 billion in outstanding HELOC debt and the largest proportion of gimmick financing resets of any State...by far.

                     www.doctorhousingbubble.com

Tue, 02/22/2011 - 10:34 | Link to Comment MiddleMeThis
MiddleMeThis's picture

C'mon on tweak up, tweak up!  You can do it!

Tue, 02/22/2011 - 10:35 | Link to Comment silvertrain
silvertrain's picture

 That should be fantastic news for city and state tax revenue's..

Tue, 02/22/2011 - 10:37 | Link to Comment BKbroiler
BKbroiler's picture

Shit I've had to hear in the last 2 years for buying gold instead of RE:

1) You can't live inside your Gold

2) It's very hard to sell

3) It's a bubble that will pop soon

4) You're not a pirate

5) People who bought in 1980 waited 20 years to get their money back

 

arr, bitchez.

Tue, 02/22/2011 - 10:39 | Link to Comment silvertrain
silvertrain's picture

AG Farmland is an execption I think..

Tue, 02/22/2011 - 10:43 | Link to Comment Kaiser Sousa
Kaiser Sousa's picture

6) You can't bitch slap a banker with it.

7) Correction - "yes we can"...

Tue, 02/22/2011 - 11:56 | Link to Comment Problem Is
Problem Is's picture

8) You can't eat gold.

9) Your brother-in-law can still borrow gold.

10) Like money, your wife can still make jewelry out of gold.

"4) You're not a pirate...arr bitchez" LOL

Tue, 02/22/2011 - 10:54 | Link to Comment oh_bama
oh_bama's picture

You are way too negative and unamerican. The tiny company CoreLogic is clearly biased and need some internet attention. What is their facebook/twitter audience size? Close to 0? What? Then make a big statement and get some!

The Recession has been over years ago!!

More american retired early, with wealth effect and low inflation expectations, and sitting in front of huge HDTVs enjoying the shows from north Africa!

 

 

Be a Patriotic person and BUY TFD!!

Tue, 02/22/2011 - 10:42 | Link to Comment Haywood Jablowme
Haywood Jablowme's picture

 

.

 

Tue, 02/22/2011 - 10:50 | Link to Comment RobotTrader
RobotTrader's picture

XHB down a paltry 30 cents

Tue, 02/22/2011 - 11:29 | Link to Comment Temporalist
Temporalist's picture

Oh no NFLX down what will Robo and Wanker do?

Tue, 02/22/2011 - 10:50 | Link to Comment Jendrzejczyk
Jendrzejczyk's picture

From the WSJ

"The National Association of Realtors, which produces a widely watched monthly estimate of sales of previously owned homes, is examining the possibility that it over-counted U.S. home sales dating back as far as 2007."

Tue, 02/22/2011 - 10:51 | Link to Comment Xkwisetly Paneful
Xkwisetly Paneful's picture

They spent enough $$$ to pay off every residential mortgage in the country 100% and still prices are falling.

 

Tue, 02/22/2011 - 11:08 | Link to Comment francis_the_won...
francis_the_wonder_hamster's picture

 

That's because the RE bubble wasn't 10-20 years in the making.  It was 75 years in the making.  When FDR started giving out subsidies for this particular asset class, true price discovery started getting distorted.

A case can probably be made that it goes back even further, to the creation of the Fed.....but that's a much longer post.

Tue, 02/22/2011 - 10:55 | Link to Comment Temporalist
Temporalist's picture
Farmers Can't Meet Demand as Corn Stocks Drop to 1974 Low

"The smallest corn inventories in 37 years are a sign farmers around the globe are failing to produce enough grain to meet rising consumption, even as planting expands and food prices surge."

http://www.bloomberg.com/news/2011-02-22/corn-stockpiles-falling-to-1974...

Tue, 02/22/2011 - 11:13 | Link to Comment Quinvarius
Quinvarius's picture

That is what happens when the US Gov and the Chinese Gov intervene in the markets to suppress food prices.  No one grows any.

Tue, 02/22/2011 - 11:18 | Link to Comment ILikeBoats
ILikeBoats's picture

Reading my now-81 year old relative's diary, I come across the interesting fact that rent in the 1949-1952 timeframe was $10 (I assume per month) on a small place (don't know if it was apt or house) - her monthly income as a schoolteacher was $120.  This was in Lancaster County, Pennsylvania.  I think the 28% of income as house payment is skewed.

Tue, 02/22/2011 - 11:22 | Link to Comment reader2010
reader2010's picture

one of my uncles told me the monthly rent was $25 in NYC back in 1947.

Tue, 02/22/2011 - 11:52 | Link to Comment Fearless Rick
Fearless Rick's picture

My dad (RIP) told me rent was $10-12 a month for a two-br apartment in the late 40s here in Rochester, NY. He bought his first home for about $4000 in 1950, then moved to the suburbs and paid $17,500 for a 3BR colonial in 1958. I live in the house today and the high assessment came in 2004 at $120,000 (bogus). It's now been reassessed at $81,500, which I feel is still overvalued, but better.

BTW: Back in the mid-70s, when I was trained to sell real estate, the rule of thumb was PITI 25% of take home pay. So, if you're making $50K today, you can pay up to about $700-750 for basic home payments.

Figure Ins. and Taxes at about $150 a month, leaves $550-600 for a mortgage. Meaning 100-120K with a 20% dp, at 20 years (30 years is ridiculous and benefits only banksters) is right in the wheelhouse. Ergo, median home prices to fall further, probably below 120K.

Tue, 02/22/2011 - 11:31 | Link to Comment velobabe
velobabe's picture

pirates are still winning†

Tue, 02/22/2011 - 11:47 | Link to Comment THE DORK OF CORK
THE DORK OF CORK's picture

Listening to K. Denninger a bit  - the guy is a capable guy but he seems to fail to grasp that wage deflation is in reality a form of inflation against goods and services - why anybody cannot grasp this is beyond me.

This phenomena is more pronounced in the Euro zone as they seem only concerned with keeping the inflation at or close to 2%.

But this uses a single euro as a yardstick - not wages or indeed other income.

Any inflation even inflation that builds capital is not countenanced if it breaks this false metric.

I have no problem with wages decreasing if the surplus goes into real capital spending but that is not happening baby.

A teacher he claims gets $80,000+ in Wisconsin - he effectively wants to cut the wage rather then inflate oil - yet if oil remains at its present relatively low  price intercontinental trade will remain somehow sustainable.

It ain't - the entire world infrastructure is insustainable - it has nothing to do with wages really - brent crude is the louisiana slaves of today , wage increases or decreases are only a artifact of the fossil fuel infrastructure.

The deflationists are deflating as they use false yardsticks - simple as that.

Tue, 02/22/2011 - 11:57 | Link to Comment Fearless Rick
Fearless Rick's picture

That's some pretty circular logic there, Dork. Besides, there's nothing simple about deflation once you inter it's first cousin, inflation. You get bi-flation, which happens regularly.

BTW: Home prices and wages ARE deflating, in real terms, but when measured against Cost of Living, are deflating faster.

Tue, 02/22/2011 - 12:16 | Link to Comment THE DORK OF CORK
THE DORK OF CORK's picture

Maybe but we really have to divorce money from the assets on commercial bank balance sheets - their growth in price was based on increasing capital being sucked out of the ground which was in reality a form of depletion masked by false accounting.

Investments will have to be directed towards non oil based capital formation - talk of wages and assets dependent on wages and credit is secondary as it is merely a artifact of these obsolete balance sheets which needed greater and greater resourse extraction to justify their present and future projected price.

Tue, 02/22/2011 - 12:02 | Link to Comment Problem Is
Problem Is's picture

"NAR's now completely disgraced Larry Yun..."

Larry is Adjusting His Suppositories
His well informed, insightful analysis with massively overstated existing home sales (a la B(L)S ), will be available shortly...

Tue, 02/22/2011 - 12:30 | Link to Comment GOSPLAN HERO
GOSPLAN HERO's picture

In Soviet Union, house mortgages you.

Tue, 02/22/2011 - 12:49 | Link to Comment Scout6909
Scout6909's picture

I see 40+ appraisals per week in Arizona.  Relative to Zillow,MLS or lender specific automated models, the actual appraisals are coming in 20% to 30% lower.  It is an absolute mess.

There are NO COMPS anymore.  Once the rates shot up in November, the "mini rush" to buy ended.

With $5 Gas now entering the equation, things should begin to get ugly quickly.    

Tue, 02/22/2011 - 13:00 | Link to Comment ElMoro
ElMoro's picture

Los Angeles is now falling faster than ever. It might take some time for the CS to reflect this.

Tue, 02/22/2011 - 13:33 | Link to Comment Temporalist
Temporalist's picture

As Reggie Middleton has pointed out before the CS lags by months.

Tue, 02/22/2011 - 14:39 | Link to Comment I Got Worms
I Got Worms's picture

I am so glad I sold my home recently. I'm in Texas, so I still was able to take a nice profit. Renting for the foreseeable future, and loving it. My only question to myself was, "why didn't I think of this sooner?" That whole "every American's dream is to be a homeowner" horseshit is so ingrained in our psyche (sp?) that even a true believing, eyes wide open type like myself had a hard time wrapping my head around renting. 

My wife keeps asking me about our timeframe for cashing in the gold and silver I bought with the proceeds from the sale, to buy our new house. I got news for her...

Tue, 02/22/2011 - 15:57 | Link to Comment reTARD
reTARD's picture

Dead cat bounce or sucker rally in housing as well???

Tue, 02/22/2011 - 16:03 | Link to Comment virgilcaine
virgilcaine's picture

Alt A and ARM resets coming up.

http://www.youtube.com/watch?v=6kAfuFGi7bY

 

An Alt-A mortgage, short for Alternative A-paper, is a type of U.S. mortgage that, for various reasons, is considered riskier than A-paper, or "prime", and less risky than "subprime," the riskiest category. Alt-A interest rates, which are determined by credit risk, therefore tend to be between those of prime and subprime home loans. Typically Alt-A mortgages are characterized by borrowers with less than full documentation, lower credit scores, higher loan-to-values, and more investment properties.[1] A-minus is related to Alt-A, with some lenders categorizing them the same, but A-minus is traditionally defined as mortgage borrowers with a FICO score of below 680 while Alt-A is traditionally defined as loans lacking full documentation.[2] Alt-A mortgages may have excellent credit but may not meet underwriting criteria for other reasons.[3]

Tue, 02/22/2011 - 16:04 | Link to Comment tony bonn
tony bonn's picture

if this isn't a green shoot i don't know what is....long live huckster jim cramer who declared the end of the housing crisis on june 30 2010 (or 2009)...

on the other hand, falling prices are indeed a healthy sign as it shows the market regaining sanity....of course it's hard to know what this means to the fed's balance sheet except that it is becoming more putrid by the day...

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