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Case Shiller Misses Consensus As Home Price Decline Continues For 4th Month

Tyler Durden's picture


If Bernanke is hoping to eventually have restore HELOCs as a piggybank for the greater US population, he better come up with something quick. The Case Shiller for October, as always nearly three months delayed, shows that the double dip in home prices which started in June, is persisting. And since both new and mortgage refi apps have plunged in recent weeks following the spike in the 30 Year cash mortgage rate, do not expect to see any rise in Top 20 Composite MSA home prices. From the October print: the October SA Composite 20 came at 143.52%, a decline of 0.99% from September, and just down from a year earlier. There was a sequential decline in 18 of the 20 MSAs, with just Denver and DC posting an increase. The biggest drops were in Atlanta (-2.13%), Chicago (-1.80%), and Minneapolis (-1.76%). The decline was even worse on a non-seasonally adjusted basis, where the sequential decline in the Composite 20 was -1.32%. As the attached chart demonstrates, the double dip is accelerating, as the sequential drops are increasing in magnitude. This data flatly continues to refute claims that there is  any economic recovery going on, as the primary source of middle class wealth continues to decline in value.



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Tue, 12/28/2010 - 10:51 | 833226 Robot Traders Mom
Robot Traders Mom's picture


Tue, 12/28/2010 - 10:57 | 833249 TWORIVER
TWORIVER's picture

Breaking into all time mean territory now with that avatar!

Tue, 12/28/2010 - 11:15 | 833311 Byte Me
Byte Me's picture

Wot? No charts?

Tue, 12/28/2010 - 11:57 | 833472 Arius
Arius's picture

would you mind to put a selling point too?

Tue, 12/28/2010 - 10:54 | 833231 Caviar Emptor
Caviar Emptor's picture

Score another one for Biflation, bitchez! 

Houses down, oil up. That's the news this week. Which just goes along with the theme-songs of employment down, food up and incomes down, cotton up. And tuition up. And healthcare up.

With credit card interest at 22% we're sure gonna have a 'Robust" consumer next year!

Tue, 12/28/2010 - 12:01 | 833485 SteveNYC
SteveNYC's picture

The Bernank is doing a beautiful job balancing "inflation" and keeping it at ZERO! Think about it, houses down/oil up = net result BALANCED! Yes, The Bernank truly is the greatest central banker of all time, Greenspan eat your heart out.

This has got to be great for the middle class....

Tue, 12/28/2010 - 18:15 | 834500 TheJudge2012
TheJudge2012's picture

Exporting inflation to China

For now anyway.

Tue, 12/28/2010 - 12:06 | 833493 Beatscape
Beatscape's picture

The Double Whammy Economy...

Wages down, job opportunities down, home prices down, commercial real estate down, cost of doing business is up with city, county, state governments all broke and raising taxes and the feds are layering in more and more bureaucratic burdens...

Oil and gasoline prices are up, cotton/clothing prices up, food prices are up, health care costs higher, college tuition prices higher...

Call it the middle class vise grip...

Tue, 12/28/2010 - 16:10 | 834129 TruthInSunshine
TruthInSunshine's picture

'The Great Bernank Milk Money Shake?'

Tue, 12/28/2010 - 15:49 | 834073 Ricky Bobby
Ricky Bobby's picture

Repeat after me "There is no inflation, There is no inflation, There is no inflation" That's what I hear from the talking heads so it must be true.

Tue, 12/28/2010 - 10:53 | 833233 mikla
mikla's picture

So *not* a surprise.

Unless you pretend to be paid to report on such things.

Tue, 12/28/2010 - 10:56 | 833242 LoneStarHog
LoneStarHog's picture
Futures Hold Gains After News on Home Prices

This is the CNBS headline and if one does not actually READ the release it gives the impression that the news was POSITIVE.

Tue, 12/28/2010 - 10:58 | 833256 skohiu
skohiu's picture

All that matters this morning is CNBS's headlights..........did you see Amanda Drury's puppies?

Tue, 12/28/2010 - 11:06 | 833277 cossack55
cossack55's picture

If you are implying that the worse the news, the more visible the cleavage, bring on the flash crash.  Thats about all she is good for anyway. 

Tue, 12/28/2010 - 12:04 | 833487 velobabe
velobabe's picture

i noticed them, on morning joe this AM. cleavage galore, nice puppies she has, and i bet they don't sag a bit.

Tue, 12/28/2010 - 10:57 | 833248 put_peter
put_peter's picture

Gold up, retailers on their knees and home prices down... something does not add up here...

Tue, 12/28/2010 - 11:00 | 833258 Caviar Emptor
Caviar Emptor's picture

Gold is protection against your buying power getting crushed. Anyone holding dollars wants to dump them as their buying power erodes daily. That means incomes, dividends and interest are also eroding. So gold provides actual biflation protection

Tue, 12/28/2010 - 11:04 | 833272 put_peter
put_peter's picture

But one could argue that buying power isn't going down when home prices are declining... However the world has gotten so weird that i think the mother of all crashes is just around the corner... JMHO

Tue, 12/28/2010 - 11:09 | 833286 Caviar Emptor
Caviar Emptor's picture

In an economy where housing prices are dropping (the bulk of people's net worth) and cost of living and doing business are rising fast it makes sense. It means businesses can't pass on rising input costs. Margins get squeezed. It sets up a vicious cycle where the Fed will unrelentingly print more in response, reinforcing the effect. Only gold is preserving your buying power.

Tue, 12/28/2010 - 11:14 | 833315 put_peter
put_peter's picture

Yes i understand the concept of preserving your wealth with gold. However to me i think market is telling: Housing prices are going go a way lower as the money is going to gold instead of homes. That on the other hand means that we are heading to deeper into recession... I hope i'm wrong because that could spell a total catastrophe. 

Tue, 12/28/2010 - 11:30 | 833373 MachoMan
MachoMan's picture

One of the fundamental problems with our government and its pervasive involvment in our lives is that our citizenry has not the courage to believe in itself...  Do not rule out possibilities simply because you do not want to believe they could occur... 

Tue, 12/28/2010 - 14:17 | 833807 cossack55
cossack55's picture

Total collapse, total catastrophe, its all good.  The only way to fix a system this corrupt is to let it burn.  Burn, baby, burn.  Also, during the fire is a great time to seek and deliver retribution to those who have deserved it so long.

Tue, 12/28/2010 - 11:02 | 833260 Everyman
Everyman's picture

I think I get the pattern now, they sell Home builders now and buy NFLX and AMZN?

Tue, 12/28/2010 - 11:02 | 833261 oh_bama
oh_bama's picture

You guys better believe that the Fed can throw enough money at this. hehe

Buy the fucking dip. Or you will be living in this bearish biased, end of day type of online community forever, with bitterness in real life.


Tue, 12/28/2010 - 11:49 | 833439 unununium
unununium's picture

This ain't the dip.

Tue, 12/28/2010 - 11:03 | 833265 Cognitive Dissonance
Cognitive Dissonance's picture

This can't be happening. I mean we're right in the middle of a strong and sustained economic recovery, right? What do you mean house prices are dropping? Who dropped the ball?

This means we're gonna need to buy municipal bonds and every damn mortgage in America over the next 18 months. Where does this end?

Tue, 12/28/2010 - 11:06 | 833275 emsolý
emsolý's picture

It ends with the Fed. I mean the Fed ends it. I mean end the Fed.

Tue, 12/28/2010 - 11:52 | 833455 Eternal Student
Eternal Student's picture

It ends with the Bond market saying "no", with higher rates. Once we start getting cut off from the source of this heroin, i.e. cheap credit, then we can move on to getting back to normal. Unfortunately, that's going to be ugly. That's why the Fed can't effectively print unto infinity.

Re: Case-Shiller. A key thing has been left out of the article, and the comments to date. CS has said that the Seasonally Adjusted number should be ignored; the only thing which counts is the NSA. So this number is indeed very bad.


Tue, 12/28/2010 - 16:11 | 834130 ElvisDog
ElvisDog's picture

Yeah, I thought this was the "winter of recovery" that followed the "summer of hope" or whatever it was.

Tue, 12/28/2010 - 21:23 | 834842 StychoKiller
StychoKiller's picture

Guess this means you haven't planted your "money tree" yet...

Tue, 12/28/2010 - 11:05 | 833266 HarryWanqer
HarryWanqer's picture

I see a lot of smaller homes of 800-1000 sq. feet selling for $90k in lower middle class neighborhoods.  The houses in higher middle class neighborhoods are selling for just over $100k of course.  What are people waiting for?  At these prices, you're practically stealing it.  Better buy why you can!

Tue, 12/28/2010 - 11:06 | 833274 Caviar Emptor
Caviar Emptor's picture

Not considered a value at these levels or even a good investment long term. Post bubble real estate prices can stagnate for decades. Even worse if the economic picture is spelling contraction. Even worse if nobody has any money left when they're getting squeezed from biflation.

Tue, 12/28/2010 - 11:09 | 833292 thepigman
thepigman's picture

Where do you live, Wanker? Kansas?

Tue, 12/28/2010 - 11:20 | 833344 Cognitive Dissonance
Cognitive Dissonance's picture

This is Wanqer.

You have been Wanqered. :>)

Tue, 12/28/2010 - 11:47 | 833435 Careless Whisper
Careless Whisper's picture

good weather and medical marijuana isn't enough to get me to move to cali. with a nazi loving governor, carbon taxes, and high unemployment, it's adios.

here's a house in compton for only $99,900 and it has a pool.

but then there's all those nasty drive-bys


Tue, 12/28/2010 - 11:58 | 833471 bob_dabolina
bob_dabolina's picture

They're gona' have to remove that steel wire fence if they want the subprime ninja's in.

Tue, 12/28/2010 - 12:38 | 833612 Cognitive Dissonance
Cognitive Dissonance's picture

If you look carefully at the 14 photos, it appears the house has a mold problem. Look closely at the one of the closet and also just above the baseboard trim in several photos including the bathrooms.

That can't be good. Nice back yard though if you're not being shot on sight by the drive by shooters.

Tue, 12/28/2010 - 13:02 | 833672 caconhma
caconhma's picture

Nice people, nice neighborhood. After all, it is so close to Hollywood with all its glamor.

Will our next presidento be from this neighborhood? You never know.

Americans were brainwashed to an imbecile level.

Tue, 12/28/2010 - 21:26 | 834852 StychoKiller
StychoKiller's picture

Drink Brawndo!  It's got what plants crave!

Tue, 12/28/2010 - 13:38 | 833736 Don Birnam
Don Birnam's picture

"Home, Sweet Home ?" Not on Racquet Club Drive.

"Straight Outta Compton !"


Tue, 12/28/2010 - 16:39 | 834194 Lucius Corneliu...
Lucius Cornelius Sulla's picture

Lots of "bargains" in Detroit.

Tue, 12/28/2010 - 11:10 | 833295 cossack55
cossack55's picture

HW. I junked you only because you deserved it.  My question to you, tho, is..... does the C/S report impact on my 100% cotton Teepee? It is my home, but all cotton.....what do you think?

Tue, 12/28/2010 - 11:13 | 833302 TWORIVER
TWORIVER's picture

they don't have the money and can't get the credit Harry, thats why. I wished that I lived in whatever little happy corner of he world you live in because it ain't like that where I am or anywhere else from what I see.

Tue, 12/28/2010 - 11:55 | 833463 GreenSideUp
GreenSideUp's picture


Same here.

Tue, 12/28/2010 - 11:36 | 833386 bob_dabolina
bob_dabolina's picture

Shut it Shit Banger.

Go back to selling your toilet bowl lids or whatever you do.

Tue, 12/28/2010 - 11:47 | 833432 Fearless Rick
Fearless Rick's picture

Harry Wanqer (not the real Harry), with all due respect to the mentally-challenged, you are retarded. Those $90K homes will be worth $60K in a few years and the $100K homes worth maybe $70K. Housing is still in need of a 25-30% haircut before it even comes close to affordable, which, if you want to use a simple (old) rule of thumb, should be 25-30% of take home pay, not gross, which gets whittled to nothing by FICA and the rapacious tax code.

You make $40K, after taxes, plus maybe a refund, you take home maybe $30K. That's $2500 a month. Your mortgage, real property taxes and insurance should be in the range of $600-750 a month. A $100,000 home with 20% down, 80K financed over 20 years at 5% with 1.5% property tax is roughly $650/month. Decent value.

Wages are not rising. More single earners. Prices have to drop into $60-75 range for affordability to the lower end of the earning class - $20-35K, a growing demographic.

Tue, 12/28/2010 - 11:56 | 833466 Eternal Student
Eternal Student's picture

So, let's see how many fools don't realize that you're not HarryWanker, but someone else getting tremendous jollies out of posting as a look-alike, namely HarryWanqer. I see you've fooled 5 so far.



Wed, 12/29/2010 - 03:09 | 835212 Miles Kendig
Miles Kendig's picture

You must live out beyond the Pocono's

Tue, 12/28/2010 - 11:04 | 833267 Caviar Emptor
Caviar Emptor's picture

Note the underwhelming rush to dollars in response to global gloom. Translated, they're getting dumped as fast as repatriation of hot money. This is extremely gold bullish

Tue, 12/28/2010 - 11:05 | 833268 wiskeyrunner
wiskeyrunner's picture

No such thing as a down stock market, stock index will close green everyday this week.

Tue, 12/28/2010 - 11:10 | 833290 Cdad
Cdad's picture

Who cares about home owners?  Who needs them, really?  Wall Street bankers don't need them.  They have fake money from the Fed.

This whole housing thing is overrated.  After all, didn't everyone on Earth expect Wall Street to computer arbitrage to death the place where Americans store wealth?  Really, where is the surprise?

Come on folks...let's get with it.  The party is at the Roach Motel [SPY]...and the drinks are free...except you are paying for them as your home is computer arbitraged to death by criminal syndicate Wall Street bankers who just blew wads of cash on shiny it is time to spin the mirror ball again...and fire up the creation units machine over at the Roach Motel [SPY] so that infinity can start being sold again just exactly when folk figured there was nothing left to sell.

Modernize, Average Joe!  Assume the innovative mind of the criminal syndicate Wall Street banker and make something of nothing.  Get with and run with the herd that is [laughably] running in the same bankrupt direction it has been running for the last ten years while trying to convince M. Shaprio to allow them to continue running in the same direction.

Sweet!  Let's Rumba!  And never mind about that cliff...

Tue, 12/28/2010 - 11:19 | 833340 emsolý
emsolý's picture

...Jimmy Cliff? "You can get it if you really want"... :-)

Tue, 12/28/2010 - 11:10 | 833291 High Plains Drifter
High Plains Drifter's picture

I told them one time at the County Assessor's office and they said.

Who Case Shiller?  My taxes continue to go up.

Tue, 12/28/2010 - 11:13 | 833303 cossack55
cossack55's picture

How does that old saying go....?

You get the goobermint you deserve.

You get the goobermint you can afford.

You get the goobermint and the goobermint "gets" you.

Tue, 12/28/2010 - 11:13 | 833308 apberusdisvet
apberusdisvet's picture

None of the POS analysts ever makes the connection between the median income (<$50k) and a currently affordable home (<$150k).  And yet no merchant builder has a s/f development going at this price point. DUH!  The continued talking points memo that has wide distribution throught the satellite offices of the Ministry of Propaganda  continues to obfuscate employment, CPI, retail sales, housing, etc. and glorify all the BS artists. (hello Krugman, Timmie and Ben).

And yes. Mandy's got a great set.

Tue, 12/28/2010 - 11:18 | 833335 thepigman
thepigman's picture

But I feel so much better and spend
so much more when they lie to me.

Tue, 12/28/2010 - 11:15 | 833318 Boilermaker
Boilermaker's picture

The IYR just nudged negative!  It's negat...oh, shit...nevermind.

Tue, 12/28/2010 - 11:16 | 833319 Dexter Morgan
Dexter Morgan's picture

I sold my mom's house in 04/07 for $144,000, or 212 ounces of gold ($680 at the time).  It was listed in 07/10 for $54,900, or 46 ounces of gold ($1180).  No takers after 4 months, so they dropped the price to $44,000, or 32 ounces of gold ($1380).  Still no takers so off the market now.  "A trend remains a trend until proven otherwise."--Edwards & Magee.  Real estate priced in gold is the trend I am watching.

Tue, 12/28/2010 - 11:31 | 833376 ColonelCooper
ColonelCooper's picture

Ding! Ding! Ding!!!  We have a winner!

Tue, 12/28/2010 - 11:33 | 833385 MachoMan
MachoMan's picture

compare and contrast to the price of good farm land ;)

Tue, 12/28/2010 - 11:39 | 833401 Dexter Morgan
Dexter Morgan's picture

Farm land has been going up, no?  I have been thinking about getting some good farm land and growing my own food.  No bills = no need for The Bernank and his worthless paper.

Tue, 12/28/2010 - 12:06 | 833490 Fake Jim Quinn
Fake Jim Quinn's picture

Dexter -- Here's an article that might help you in buying farm land

Tue, 12/28/2010 - 12:22 | 833554 Dexter Morgan
Dexter Morgan's picture

TY, great article!  Very good info.  I also liked at the end where they recommended to invest in pot.  ;-)

Tue, 12/28/2010 - 12:26 | 833563 Fake Jim Quinn
Fake Jim Quinn's picture

LOL. Hey -- might solve the deficit once it is taxed

Tue, 12/28/2010 - 14:45 | 833884 MachoMan
MachoMan's picture

What no one wants to admit is that the boom in farm land represents a complete and total mistrust of the value of the dollar and future expectations of devaluation.  The point is this, if everything goes to hell, you have a place that can provide you a stable living regardless of the underlying value of the dollar.  In the end, all of the gold bugs are just holding out to trade it for farm land...  it's the end all be all of investments...  you control the spice, you control the universe.

Essentially, there is a mad rush to convert the dollar out of the ether and into some hard asset....  the boom in farm land should be troubling for most. 

Further, I do not value expectations of a collapse in farm land prices...  The people pumping money into farms now are OK with that expectation...  THEY KNOW THAT... 

Tue, 12/28/2010 - 14:35 | 833856 MachoMan
MachoMan's picture

Yes, farm land has been skyrocketing.  Further, at least in my neck of the woods, there is a concerted consolidation of land holdings...  lot of big money coming in and buying everything in sight.  The trick to purchasing farm land is to not buy it on credit and it will provide a decent return...  otherwise, you're wasting your time.  But, of course, that's kind of like the steve martin SNL bit about so you want to be a millionaire?  First, you get a million dollars...

Tue, 12/28/2010 - 15:02 | 833923 TruthInSunshine
TruthInSunshine's picture

Farmland that was under contract to become tract housing, retail centers and other commercial uses back in 2007 is now being offered by soon-to-die farmers (whose kids don't want to be farmers) for a literal fraction of what it was under actual option contract for.

I know this for a fact. I am in this industry. I know the sellers personally, the brokers personally, the real estate attorneys personally and other players in the game.

And very, very few takers are out there, as banks don't loan money on vacant real estate (especially now), even on a very fertile and beautiful 240 acre parcel that has city water and sewer, at exactly 12% of what the property was under an option contract for in 2007.

That is correct: The farmer is willing to sell the property at an 88% reduction over a signed option contract amount that is now toilet paper, legally speaking, and there are no takers.

Oh, and the former potential buyer was a national mall developer.

Don't even get me started on industrial property pricing. Much of it literally has a negative worth.

Bernanke knows that if banks' assets had to be fairly valued, he would have a crisis on his hands so enormous, that he'd just decide to 'spend more time with his family,' and possibly abroad.

Tue, 12/28/2010 - 15:42 | 834056 FreedomGuy
FreedomGuy's picture

Nice to get an inside picture, Truth. This is a textbook example of what Austrian economists would call malinvestment. It is because of government incentives that an entire self perpetuating spiral started in real estate. In CA there was panic buying before prices got out of reach. All investments were geared toward an ever upward property value and prosperous future. Now, there is a glut and a demand reversal to the negative. I think it will not clear for a very long time.

Tue, 12/28/2010 - 16:38 | 834195 traderjoe
traderjoe's picture

Truth - what state is that parcel located in? Are you a farmer? I'm interested in learning more, and perhaps taking the plunge sometime soon...

Tue, 12/28/2010 - 16:48 | 834224 MachoMan
MachoMan's picture

Uh...  what was its value strictly as farm land during all this time...  you're basically arguing that the price of the industrial/commercial use of the property has decreased by 88%, at best...  what was the price per acre of similar farm land valued at during this entire time?  My guess is this will account for the vast majority of the difference...  what limitations does the tract have for ease of entry for farm vehicles?  Is it close to residential land?  Where is the land located (state/city)...  Too many variables not explained...  aside from the fact that I'm more concerned with macro trends than individual parcels...

Tue, 12/28/2010 - 17:16 | 834303 TruthInSunshine
TruthInSunshine's picture

The state is Ohio.

I am not a farmer, having grown up in a fairly urban/densely populated area, but if I had to do everything all over again, and knowing what I do now, I would at least consider it for reasons other than money (though that reason can be compelling given the right crop, yield and area of the nation and operation).

And yes, it's a fair point to raise that I am comparing its value as potential commercially developable property during the boom vs workable farmland.

If one were to compare its value on a fertile farmland vs farmland basis, it's probably risen 40% or so in the last decade.

However, as to this particular piece, now that the farmer had an offer on it for such a high number, and given that municipal water and sewer were run across it by the county and township, a fellow farmer would be leery of buying it (as the price the owner wants is still too high to make the numbers work and out of line with competing parcels), and because of the new tax, appraisal and other complications.

Also, I do notice that perfectly arable farmland has been stagnating or dropping in price, generally speaking, in many areas (multi-state), despite running up in value at a brisk clip from about 1998 to 2006. This includes farmland suitable for growing corn and produce, too (but not soybeans or wheat, necessarily).

Many farmers are being run out of business by big agri, their kids do not want to continue in their parents' footsteps, and they had banked their 'bank' on the value of their land being worth far more than it is as of now, in their advanced years.

This isn't to say select farmland suitable for particular purposes, such as soybean growing, isn't continuing its march forward, because it is.

Tue, 12/28/2010 - 19:32 | 834662 MachoMan
MachoMan's picture

Farming is a dying religion...  technology has allowed those with the know-how to farm tens of thousands of acres with some lackies.  The 20/30 year old crowd has not a clue about proper farming techniques...  The most successful farmers are generally not very well educated, but they're really, really sharp cookies.  The younger generation is not only lazy, but pretty fucking dumb.  We can handle technology like nobody's business, but advances in technology will not outweigh our ignorance.

In my neck of the woods, rice/soybean/cotton country, prices have increased ~50% in ~10 years.  The deepest of the deep pockets are continuing to buy (nationally we are really cheap per acre) and they don't do it with leverage...

The largest risk I see to farming is rising input costs without a corresponding collapse in society (oil, water, fertilizer)...  this is the bias towards cheaper prices...  just shaking out those with any leverage.  If you don't have any leverage, it doesn't really matter...  it's like holding gold and silver...  just hold on to it and watch it and that's about it...  even if it falls to half its present value in dollars, you still have something that will produce income/food...  which is a shit ton more than you can say for a treasury bond.  Plus, you can have a pretty awesome fiefdom if you get enough acreage.  I'm thinking robert e lee wilson's ghost will be resurrected and reanimated...   

Tue, 12/28/2010 - 11:33 | 833380 sbenard
sbenard's picture

Meanwhile, stocks continue to defy gravity, and our politicians and the Fed continue to try to defy the laws of sound economics!

Tue, 12/28/2010 - 11:45 | 833429 bob_dabolina
bob_dabolina's picture

Stocks and economics are two completely different turds in seperate bowls.

They are mutually exlusive to one another.

Tue, 12/28/2010 - 11:36 | 833393 svendthrift
svendthrift's picture

I rent a condo (in Miami) that was purchased for 270k in 2006. The unit next door, which is identical to mine, just sold for 120k. I can not imagine what my landlord must be thinking right now.

Tue, 12/28/2010 - 12:51 | 833647 Seasmoke
Seasmoke's picture

He is thinking he cant believe he has someone paying him rent, while he hasnt paid the mortgage to the bank for the past 24 months

Tue, 12/28/2010 - 18:27 | 834523 JonNadler
JonNadler's picture

that's great Sea

Tue, 12/28/2010 - 11:44 | 833425 D-Falt
D-Falt's picture

Excellent!! Reality reasserts itself. 


Here's a tip.  If those houses don't seem to work out as good speculative investments, you can recycle them.  Here's how.  People can move into them and enjoy shelter from the elements and use the driveway to park their cars.  Weird, isn't it?

Tue, 12/28/2010 - 11:48 | 833438 gangland
gangland's picture

hey haaaarry what are you waiting for shithead? Jump fucker!

Tue, 12/28/2010 - 11:55 | 833468 rosiescenario
rosiescenario's picture

...and CNBC was just airing a piece about how prices have bottomed and are now going up in several CA cities...Salinas, Madera, Merced, and Riverside....what a total crock of CNBC and NNPR....two propaganda machines on opposite ends of the spectrum....with both equally misleading (except us taxpayers get to pay for NNPR).

Tue, 12/28/2010 - 12:00 | 833477 bob_dabolina
bob_dabolina's picture

Hitler made sure the German people knew that the Nazi's were winning the war...till' the bitter end.

Propaganda bitchez.

ShitBanger (my petname for harrywanger) is a Goebbels reincarnate.

Tue, 12/28/2010 - 12:09 | 833506 gangland
gangland's picture

yeah harry should invest in merced property, merced the "dumbest" city in the country.

and riverside? you couldn't pay me double to buy there. how  can prices be going up in riverside, it's all empty delapitated boonies with a parabolic meth economy.



Tue, 12/28/2010 - 16:18 | 834147 TruthInSunshine
TruthInSunshine's picture

I have bridge in Brooklyn that I will sell to Harry Wang on a quit claim deed for $1.

He can also buy the rainbows and skittles that shoot forth from Ben Bernanke and Tim Geithner's asses.

Tue, 12/28/2010 - 11:57 | 833470 haskelslocal
haskelslocal's picture

A chart that starts inside the bubble? How about a 10/20 year chart for relevance...

Tue, 12/28/2010 - 12:10 | 833503 johngaltfla
johngaltfla's picture

The good news is that we only have 10-15 years to go before the real estate crisis is over.

The bad news is that the demographics of the United States are about to come into play which will make this double dip about 20% worse than the Bubblevisionistas could ever imagine.

Tue, 12/28/2010 - 16:42 | 834210 AbbeBrel
AbbeBrel's picture

Josh Rosner, “Housing in the New Millennium: A Home Without Equity Is Just a Rental with Debt,” GrahamFisher Housing Trends, June 29, 2001

Also from a Bloomberg interview (sorry I forget the source) :

  The extended unemployment benefit is the new welfare.

This, along with The Bernank endlessly goosing the market, is part of the New Normal.

If you have a job and a decent rental, then don't fight the tape!  - AB

Tue, 12/28/2010 - 12:25 | 833537 TruthInSunshine
TruthInSunshine's picture

Greens Shit....errr....Shoots!

Yeah, that's it! Green Shoots!


When does The Bernank, The Geithner (lil' TurboTax Timmay the Elf) and The Obama announce plans to pay off everyones' mortgages?

And if they take that step, they'll have to do something to appease the people without mortgages - so..."You get a new house! And you get a new house! And you get a new house!"

Let's do it. Let's buy everyone everything they've ever wanted, and make dreams come true, and deny the right of things like math, demographics and economics & natural laws to rain on our parade!

I will buy you a garden
Where your flowers can bloom
I will buy you a new car
Perfect shiny and new
I will buy you that big house
Way up in the west hills
I will buy you a new life
I will buy you a new life

I know we can never look back



Tue, 12/28/2010 - 12:30 | 833581 tempo
tempo's picture

As Buzz lightyear would say, "to liquidity and beyond"!!

Tue, 12/28/2010 - 12:36 | 833607 haskelslocal
haskelslocal's picture

Look at CaseShiller back to 1995 and we're only down to 2004 pricing. That's not armageddon folks. It's just a bubble with the top cropped off. As it should be.

Tue, 12/28/2010 - 12:47 | 833636 Seasmoke
Seasmoke's picture

the problem is we have to go back to 1995 prices

Tue, 12/28/2010 - 12:45 | 833631 Temporalist
Temporalist's picture

“The double dip is almost here, as six cities set new lows for the period since the 2006 peaks,” said David M. Blitzer, chairman of the index committee at Standard & Poor’s. “There is no good news in October’s report. Home prices across the country continue to fall.”

Tue, 12/28/2010 - 13:40 | 833738 Ye Ye
Ye Ye's picture

Buy the f#cking dip?

Tue, 12/28/2010 - 14:09 | 833788 Sqworl
Wed, 12/29/2010 - 03:12 | 835213 Miles Kendig
Miles Kendig's picture

Good to see yaz Sqworl.  You're simply fab in any season.  Best -

Tue, 12/28/2010 - 14:32 | 833846 Hephasteus
Hephasteus's picture

You know what would be great. If I could get a chart of Ben Bernanke, Tim Geihtner, the IMF, and CIA's ability to govern. Then keep revising it down till it hit's zero and then magically create imaginary numbers and take this bitch to negative 9000.

I'm going to need to you come in this weekend and get that Totally Powerless Sociopath/pSychopath report done timmy.

Tue, 12/28/2010 - 15:56 | 834091 FreedomGuy
FreedomGuy's picture

In my economics group we studied the oncoming real estate and associated financial industry crash for years before it happened. As I posted earlier, this is actually textbook Austrian economics. It is the prime proof of government sponsored malinvestment.

Depending on what you think population and economic numbers will do in the future, this glut of homes and overvaluation will last many many years. Personally, I do not think home valuations will revert to historical norms or means. I think they will fall below it for several reasons.

1. Too much inventory compared to population.

2. Prices need to fall to falling incomes (all incomes outside of government workers and bank/financial thieves, lol.).

3. People have been severely burned in the housing market and will not reenter anytime soon or without fantastically low prices.

4. Bankrupties and financial ruin prevent even those who want to buy from being able to finance again.

In addition to those factors, there is a philisophical point I have adopted, myself and I think others are adopting. After living in states like NJ where they grab your house/property and squeeze it for every ounce of tax revenue possible, I have come to prefer renting. It has every possible economic and liberty advantage over owning except one. In the event of hyperinflation I cannot fix my housing costs. All other advantages accrue to me in terms of fixing my monthly bills (landlords fix and maintain everything) and having options if necessary to lower my housing costs in the event of unemployment or even overly high rents in some areas. The state really uses your property to grab your income including many states where they get a property tax on your automobiles.

My plan is only to buy at retirement and after scouting the entire USA for the best place to retire in terms of liberty and costs.

Bottom line is without artificial government intervention I believe the housing fiasco will be around for a long time, even if the economy recovers in terms of employment. There's just too many units, not enough people, enough money or enough desire to recover anywhere near its recent highs.

Tue, 12/28/2010 - 16:23 | 834169 TruthInSunshine
TruthInSunshine's picture

There are a documented 19 million vacant residential units in the United States.

This figure does not include units occupied by those being foreclosed upon or who are delinquent (but for whom foreclosure proceedings haven't been initiated) on their mortgage payments.

Bear in mind that the U.S. is experiencing very slow population growth, as the latest census figures put the population at 308,000,000, which was very modest versus expectations.

The banks do not want to foreclose on homes that they absolutely can't sell quickly, and at a modest loss (those are relatively few in number), and their shadow inventory of units being held 'off market' is staggering.

Ben B52 Bernanke is the only reason 25% or more of the banks (and likely more) haven't closed their doors, and their lifelines are directly being pumped with taxpayer money, in a variety of schemes/scams.

Tue, 12/28/2010 - 16:43 | 834211 Lucius Corneliu...
Lucius Cornelius Sulla's picture

Housing will bottom when you can get an NOI of 8-10% in a prime (high demand) rental location.  Stocks will bottom when the S&P 500 is selling for a dividend yield of over 6%.  Until then, sit on cash and/or super safe short to intermediate term bonds.  Simple as that.

Tue, 12/28/2010 - 16:46 | 834222 cosmictrainwreck
cosmictrainwreck's picture

housing prices? WTF? we don't need no stinkin' housing prices.... looks like the pilots aboard the might Dow Jones heard their engines sputtering around the 11,587-90 elevation, but looks like they did the necessary repairs.... to the moon, bitchez! wait, what's lat blinking light on the dash? uh oh. shit, we might have to settle for a lousy +30 print

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