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Existing Home Sales Plunge 27.2%, Record Drop, Trounce Expectations Of 13.4%, Lowest Number Since May 1995
Hello Double DIPression my old friend. 3.83 million sales on 4.65 million expectation. Previous 5.37 million revised to 5.26. The chart says it all: lowest sales since May 1995, months supply largest since 1999.
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interesting how the market moves up after a 30% drop in housing sales
Same as it ever was.
...burning down the house...
Sell Dollars, buy Swissis, buy JPY. Skynet : ES long.
Very impressive PPT stick save. Jim Craig would be proud.
Nothing impressive about it, an 8 year old child could do they same thing given UNLIMITED access to funds.
I hope you are happy Ben, you now own it all.....and I mean ALL.
We never got out of the first dip—it's just one long slide down.
Fuckit, I hate being right.
GL
Yeah, kinda sucks having some clue about our economic fate. Looking forward to your next post.
Fuckin'-A it sucks!
I might be a dick, but I'm not an asshole—I get no satisfaction from people being unemployed, even though they're willing and able. I get no satisfaction from seeing people all of a sudden finding they're out of their homes, because they over-paid several multiples of their yearly incomes, and now have nothing left after a lifetime of work. Maybe they should have known better—or maybe the assholes running the joint shouldn't have succumbed to their fucking greed.
So yeah, it does suck—for everyone.
Sorry about the rant.
GL
Why be sorry when you're exactly right? Whenever I'm told that I'm being "too pessimistic" by people when I explain just why it is that we've entered a spiral of self-reinforcing decay, I remind them that I'm hardly pleased by any of this. If my customers lose jobs, then I lose customers...what joy is there to be taken in that?
Further, the assholes at the helm are definitely in for a big surprise when the day arrives in which it becomes blatantly obvious that such greed has ruined any sort of meager sustainability that might have once existed in their practices, and that it will surely sink them as well. Even basic household finances have become so filled with pit traps and potholes that no average person can avoid serious damage. If you're still lucky enough to have a job, there are plenty of greed-driven practices and penalties that exist for no other reason than to try to separate you from whatever you earn. The system is usury defined.
Gonzalo wrote "I might be a dick, but I'm not an asshole—I get no satisfaction from people being unemployed, even though they're willing and able."
I, OTOH, really enjoy watching people suffer. It's my ultimate "fuck you" to the world, of which virtually all members poo-pooed my warnings to begin belt tightening 4 or 5 years ago. I especially love watching my neighbor, who has been out of work for 2 years. 4 years ago when he was spending money on crap he didn't need, I warned him that his business was going to slow. His response. "I'll don't worry about things like that."
Wrong. He's a wreck. Oh well.
Photo? Misery loves gawkers.
Have to admit it, you are a gem. Why don't you run for a Senate seat. All politicians are narcissists and sociopaths.
You can enjoy the feeling, or you can feel guilty. Neither one negates the circumstances that cause it.
...frank... you must be the guy holding-up traffic gawking (and pumping your fist) at accidents on the highway... douche... its not about you or your brillant market calls... eventually shit catches-up and makes life miserable... suffering is inevitable... and necessary... but wallowing in (or celebrating) it is as bad as the behavior that got them there... mind your fucking manners...
Why would I enjoy the suffering of the innocent? I don't.
But, of course, nobody is innocent.
The guy going by me in his SUV 4WD in 2" of snow goes off the road in a single car wreck and introduces his gray matter to his dash - HELL YES! My kind of wreck.
You know, I put up with these morons around me showboating their laziness, obeastity, profligacy, and myopia for the last 5 years. "You oughtta get yourself a bigger/newer/shinier _____, Frank. I refied for the third time. 100 grand in equity in 05 alone."
Blah blah. 90% or more of Americans deserve a big, stinky piece of humbleshit pie.
It's my business to make sure they eat every bite.
Business is good.
Frank, you're George Carlin's and Bill Hick's spirits reincarnated, two of my favorite comics, both cynical to the core and justified in being so. The greed and stupidity of the majority ignorati have been exploited by those even slightly more intelligent throughout history and always will be. After a while, those smart enough to realize this feel like they're stuck in a lifeboat filled with idiots drilling holes in the hull, idiots who simply won't listen. Eventually, one gets tired of constantly plugging the holes with corks and simply tries to fashion ones own lifejacket out of something.
The all too typical SUV wreck you mentioned is a good example of the general stupidity that is prevalent, someone too stupid to realize that while their new 4-wheel-drive vehicle gets them going faster in slick conditions, every car they've ever owned has had 4-wheel _brakes_, so their SUV isn't going to _stop_ any faster, and every car they've ever owned has had four wheels, so the SUV isn't going to handle slick curves radically better. Magnify that stupidity by the 150 million people in the US that George Carlin pointed out are on the left side of the IQ bell curve and you have the enablers of the economic mess we are in today, all of them too stupid, lazy, greedy or apathetic to avoid being propagandized to their doom.
I think you missed George and Bill's ideas here. Although they did use the ugly stupid American as an illustrative brunts of their humor, they were trying to help the species see and improve themselves.
Frank and followers are basically saying: Everyone is a stupid shit except for me and I hope they all die soon. When they do, I applaud. Not really what we need now or at any time in history.
Ripped - I encourage you to watch "It ain't good for yuh," one of Carlin's last gigs. If you watch that and come away with the notion that he's, yuk yuk, trying to "help the species," then God Bless You Son for your alien optimism.
George Carlin, like many of us here on ZH, came closer to the truth of how this world is run the older he got. His conclusion was that we could not be helped. That people were too god-damned stupid to be helped. That we have owners, but that we are too slovenly to even raise our heads to notice. His final acts were really about his final thesis - that we were as fleas upon this planet, and my guess is that his opinion of the human species was so low that the almost certain extinction of the species would be no loss at all.
He, like me, realized that it is the biology of humans that traps us in cycles of greed, panic, revolution, repeat.
Our biology will not substantially change any time soon.
I have seen them all. George was pretty cranky at the end but accusing him of hatred of most of mankind (which you seem to suffer from) is innacurate. If anything he tried to wake the masses up to reality but I really don't think he was a hard core hater (again, the reflection in your mirror)
Personally, I have no hate for humanity nor pleasure from its misfortunes. However, going back to my lifeboat analogy, I don't have much respect for most of it and a great deal of frustration with it because the overall ignorance, apathy, and greed of the masses has negative effects which drag me down with them... like the current economic problems which will eventually be catastrophic for everyone except the plutocracy, both corporate and political, which manipulated the ignorant masses into this situation.
I'm just going to reiterate what I posted on your guest poster thread, that article you posted was a fantastic piece, thanks again for putting it together, and please continue to publicly post your insights, they are great and they are fantastic conversation starters.
regards,
weekly $INDU H&S, break below 9600 = trouble...and eco numbers arent helping. we're in trouble.
Bloom says these numbers are still lag effect of the 8k home buyer's credit. All you Bears trying to leap through the hoop all at once should provide a nice little tradeable bounce today lol
You people! We have record low mortgage rates.
Why don't you buy, buy, buy before it's too late?
lowest sales since May 1995
Nothing to feel bad about that. 1995 and the following years were quite good.
Well, there's the rate of change and there's the rate of the rate of change. But I guess that only works on the way up?
lowest sales since May 1995
Nothing to feel bad about that. 1995 and the following years were quite good.
1995 was a great year for bottom fishing. "The following years" 1996 - 2000 were good for killing time. 2001 - 2005 were good for appreciatian. 2006 - present were good for...never mind.
The early 90s were horrible for housing. There was absolutely no pricing power whatsoever. I remember Donald Trump being in a serious liquidity crunch back then and having to negotiate with his bankers to avoid foreclosing on his empire.
In 1995 the population was smaller as was the economy. SO we're actually on a real basis back way further.
They were good on the way up, they'll be murder on the way down.
By the way, nice shoes.
"....Purchases of existing homes plunged 27.2 percent to a 3.83 million...Estimates in the Bloomberg survey of 74 economists ranged from 3.96 million to 5.3 million..."
You can't be right all the time
Isn't this the third (or more) metric in a week that's been missed by the entire survey estimate? They need to start finding new folks to survey...
Just watching Bloomberg and the young lady asks the guest " is the recovery stalling " ?!
WTF !! CNBC and these twitts think if they keep dropping the " recovery " word enough times the sheeple will stay pacified.Unreal!
it helps that they've ramped the market up 100 points since the announcement. It's a multi-faceted attack of killer bullshit designed to drag the sheeple into the market and gut them.
Since April, I've been saying we should expect to see a few months of weakness in the housing numbers following the expiration tax incentives, but I also predicted we would then see an upturn as the pull-forward demand ran off and new buyers entered the market...it's only been three months (of data), but I have to admit it's not looking good for my prediction.
I'm cooking up the crow this month; if the August numbers don't improve, I'll officially be eating it.
'Pull-forward demand, new fresh buyers entering'... lol in case you didnt notice, the country is in a full-on depression and everyones broke! Cashing in their retirement at 40 to pay a couple more months bills at BEST!
If there wasn't any demand pull-forward, how do you explain the relative strength in the spring leading up to the expiration of the tax incentive?
As for the new buyers...that's that part where I'm admitting being wrong.
HOORAY for the Summer of Recovery! 'Endless' style...yea baby come on Becky give me some more pouts!!
Its that pout that drives ole Warren crazy, too.
ooo the PPT kicked in...can't have it below 10,000
DOW only off 120 after confirmation the housing market has completely flat-lined? This market makes no sense anymore.
"This market makes no sense anymore"
I propose that the above statement be banned as a descritive of the market. To be replaced by - "Any more sense no market makes this." All in favor say aye.
I get to hear that the "recovery is slowing" on the news again today?
I wonder how slow one's pulse needs to be before being declared deceased...
Now that the Obama Home Tax Credit has stopped distorting the housing market, the continued housing market price adjustment can continue. Needs another two years before it climbs again. Talked to many people in residential RE, and the market is dead. Drop by an open house in your community, and check the log in sheet (if they even bother to have one out). and ask the agent how the traffic has been. Remember to filter the RE agent comments, and any reply other than "Fantastic!" means it's crappy. Prices have to adjust to get traffic in even with low rates. Owners cannot fathom that their RE is slidign at 6% per annum, and are trying to bid up prices.
As prices came up with Tax Credit, more inventory appeared. That means lower pricing with slow traffic.
I mean WTF, they cant even get refi's churning at these rates. What to the people intuit that the brains in DC cannot?
WTF
All buy offers should be 20-25% below list price. No need to raise bid either. Some one will hit it.
purchasing a home next month and would've been eligible under the home buyers credit for the $6500. So, should i hope congress panics and reinstitutes the credit or should i hope they come to their senses and refuse to piss any more money away? i sure would like one of those zero turn lawn mowers!
No one here can say for sure. Some think real estate will drop to mid 80's prices before this is all over. Who knows.
It was a big risk at the time (and Im not sure it still isnt), but in Feb 09 we bought our South Fla. house at the courthouse for 55% of the price it sold for new in 1990. We cleaned the pool, replaced the pool pump, cut the grass, hung new ceiling fans and lights and moved in (it was very decent). We paid 22% of the total foreclosure amount of the 2006 sale price at the auction. I expect to see those prices become the norm before too long. The one good thing about it, our taxes are dirt cheap now. In 2006 the taxes for the new home owner were 3 times as much.
I can say for sure. Ignore the buyers credit carrot. That 6500 will seem like a pittance compadres to the 70% savings coming when home prices drop.
Currently in this predicament... Thinking about giving back the $8k (22 months left), taking the equity (got in cheap) and running. Currently at 1.5x annual income... thinking of buying next house at 1.0x annual income... paying it off in a couple years.
They can throw the credit back out there but underwriting standards are super tight now. Opens the market up to the same risk-taking that melted it in the first place. Expect new market participants in mortgages to show up shortly.
They ramped the dollar up until the housing news was released. When the market fell so did the dollar, or it would have been end-game. Go Bitchez!
most of the mo guys have the intelligence of a 5 grader. They follow and never lead, just sit back and watch as they all jump out of the pool at the same time.
Once again, "let the market clear"
hahahha is all I got to say
If no one want to buy houses, just make them FREE, to go along will all of that FUnemployment! Wheeeeeee !!!! McMansions for everyone!
Your suggestion may not be as outlandish and it seems. With real estate taxes going ever higher, it's in certain municipalities' best interest to have someone living in that house as long as they can pay the taxes. I believe that, before this is all over, you'll be calculating what kind of house you can 'afford' based on the tax liability first and the mortgage will be a secondary concern.
1-800-1-WhyOwn
Time to switch all those option ARM's to let to own and rework that paper to follow the upcoming re-fi wave and give the fed/fnm/fre a couple of trillion to leverage...
Look at D.R Horton & Pulte and the other builders... All up after numbers came out at 10:00, I guess this is the bottom....
Perfect! I like that one.
just sit back and wait for another 20% drop.. then I may buy.
prices still need to come down to match minimum wage levels..
Shiller thinks 20%, and I think he's being conservative since he sits in the public eye.
Bone crushing number
When you consider the impact to household 'wealth' notwithstanding the need for tax re-assessment the equation is UGLY - plain & simple - Collateral/Debt Deflation - and for ANYONE who believes the US will not double-dip I have the following question - which sector(s) will compensate for housing in order to lift the US GDP? (Alex, I will take Bennie Boy & Timmie as the modern day Thelma & Louise for $100....or is it $1,000 or $10??)
If we want to get out of this mess long term ( I know long term thinking is still passe in the western world) - the money supply will have to divorce itself from mortgages and consumer credit.
Therefore even honest small business owners who rely on unsustainable private consumption will have to suffer.
Looking at it simply capital formation is not building houses - it is energy development.
The reason why we are in this mess is that every time there is a "recovery" - resources get diverted to houses and other consumer fluff therefore no sustainable capital formation is developed.
The link needs to be broken.
deleted
DRV only up .29 on this housing sector news? What's up wit dat?
Since May 1st, an existing homeowner who is unemployed has lost 33% of the potential opportunity to sell his/her house to move to a new locale to find new employment.
Market labor mobility of the "homeowner" sub-sector of the workforce is at the lowest point in the history of the country.
It's OK, the Realtors say it was "expected."
Updated S&P500 chart showing head and shoulders with target.
http://stockmarket618.wordpress.com
How does that song go, head and shoulders knees and toes, knees and toes.
I'm pulling up some mortgage quotes for a client right now - anyone want a (my cost) quote? This is for informational purposes only and is NOT a solicitation to handle your financing - I don't want to. Just trying to keep 'em honest.
Give me a hypothetical ("it's for a friend") and approximate -
value, loan amount, credit score, property type, and occupancy status (primary, 2nd home, etc.)
Better have:
25% to 30% LTV or better
full doc displaying no more than 40% DTI
720 or better, no liens, judgements or charge offs.
Or you will get nothing and like it
Actually, you can get almost all of the pricing specials with a profile like this.
up to 80% LTV
45% DTI
720 mid score
SFR
The client I quoted this morning, who profiled about the same, wanted a zero point loan. I quoted 4.125% with 0 points - the investor was paying a little over 1% rebate (after a .5% deduction for my company).
So if you profile as above, or better, you should be hearing 4.125% with no points. And things will probably be a little better tomorrow, depending. If you're not, tell your loan officer you want to hear the sound of a pencil sharpening.
Anybody that works for a living is about to get poorer than shit; you basically work for the squid and keep your mouth shut your allowed to exist another day.
I have 3 degrees and worked for corporations until I was 32, then became a land surveyor and worked for consulting firms. I'm starting my 13th job next month; all I can say is we're in a war zone so keep your head down.
Twian said about Hucklberry that "he came and went as he pleased", that's been my basic philosophy and it's too late now to change.
I now have investments in organic gardening and knowlege of how this ponzi scheme is going down, not much to hang my hat on after 30 years but WTF
I now have investments in organic gardening and knowlege of how this ponzi scheme is going down, not much to hang my hat on after 30 years but WTF
I would say that you are way ahead of the game.
PS: Had a big short position in May 2005 on homebuiders, the position was a little too big for me and I got squeezed out, but it would have been a kill shot by September that year
Is there available a chart or a way to easily generate on-line a chart that shows the projected, reported and revised US GDP figures? If it shows an obvious bias towards too-high projections and reportings with too-often downward revisions, I believe that this would indicate an intentional bias. The same could be done for housing related stats.
Honestly, this is not surprising giving the Pending Home Sales figure a while back that showed a decline of 30%. I was fully expecting a collapse and said as much on here. Amazingly the proffessionals didn't.
The bansksters who started this whole mess are continuing to ass fuck everyone...and now they are doing it to themselves. Without the benefit of large volumes of macro info and based on my observations of a smaller market I predict we will see the 34% decline in home values continue to move downward after the short recess of declines in value is over, which is now! What is most troubling to me is the sector of larger homes with the jumbo style loans and how their decline will affect the overall market. I have observed a tremendous slowdown of these type of sales and now, for the first time, I am seeing short sales for these type of properties with asking prices 60% off from original asking prices. Per square foot prices are now a fraction of replacement. The entire market will move downward as a result of pressure from the top. I think we may be getting to a point where banks will choose not to foreclose and will start doing principal writedowns...there would be no difference in today's losses to the banks and one less property would be listed for sale for each writedown, which, hopefully would tighten supply and stop the freefall, limiting future losses. Only time will tell.
One more thing, if people with underwater deals want to get banks to start negotiating realistic loan mod terms, they ought to let the banks know that prior to any foreclosure they plan to start remodeling the home and that the first phase of remodeling, as we all know, is demo. If the greedy banks had to worry that their losses had the potential of doubling, they might become more willing to to the right thing.
It's obvious the RE market is in the shitter and agents (vultures) are not helping. 6% for WHAT??
Here's a test. Call an agent as a buyer and ask how the market is looking. Then call the same agent and this time as a potential short seller, put on a voice, and ask about the market again.
I did this using two different phones and 1 hour in between and was not suprised by the answers. Whores.
Thanks for such a great post and the review, I am totally impressed! Keep stuff like this coming!...
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