More News To Be Swept Under The Rug: Housing Inventory Jumps From 8.3 Months To 8.9 Months, Highest Since August 2009

Tyler Durden's picture

One of the most conveniently ignored data points from today's NAR report, is that the inventory of existing homes available for sale rose to 3.99 million, representing an 8.9 month supply at the current sales pace. This is up from 8.3 months in May, and is the worst number since August 2009, when it was at 9.2 months. Of course, if one adds the shadow housing inventory estimated by Morgan Stanely at around 5 million, and we get shadow inventory of just under two years. Obviously this is deflationary as it kills the pricing power of any household trying to sell their home. And in other news, the market now spikes on deflation concerns.

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Ivanovich's picture

All this negative news is irrelevant.  Go long, make money.

Robslob's picture

Ben and the Beanstalk market...

Who owns the golden goose though?

Edna R. Rider's picture

Ah.  CAT equipment used to bulldoze it.  Now I see the way the market works.

jimijon's picture

LOL - Where is CAT selling besides to demolition companies?

London Dude Trader's picture

The bond market has noticed. Note 10-year yields have peaked for the day and are now  falling, even as stocks are rising. I bet the the 10-year ends the day unchanged or lower. 

lizzy36's picture

Just a little pin prick.
There'll be no more aaaaaaaaah!
But you may feel a little sick.
Can you stand up?
I do believe it's working, good.
That'll keep you going through the show

Cognitive Dissonance's picture

Like the walking wounded who play professional football on Sundays, near the end of a long season, nearly everyone on the team is visiting the trainer for a shot or pill to make it through the 3 hours of the game.

That's where we are in this century long economic cycle. The end of the game.

aaaaaah, thanks doc. You're a life saver.

The Franchise's picture

Meanwhile, 200 miles Northeast of Dutch Harbor, Captain Ben Bernanke finds himself in an unusually uncertain environment.

JR's picture

You want to know how bad it is?  Even garbage is down.

Another Recession Ill: Too Little Garbage | The Carmel (CA) Pine Cone | July 16-22

It’s no secret that because of the recession, people are buying less stuff. Not surprisingly, that means people also aren’t throwing as much stuff away.

While some may believe less waste is a good thing, that’s not what landfill operators think.  A decline in trash translates into less revenue and fewer jobs.

The Marina landfill is no different.

Since 2006, the Monterey Regional Waste Management District has seen a more than 30 percent decline in the amount of commercial and residential waste—a drop off in business that’s forced a hiring freeze and other spending cutbacks at the landfill, said Jeff Lindenthal of MRWMD.  “However, I think this recent recession disproved that myth.” …

At the end of the 2009/2010 fiscal year,  the landfill had taken in 197,000 tons. That’s compared to a peak of 279,904 tons of trash in 2005.

Ripped Chunk's picture

Not including all the units that are "non-performing" but not yet in foreclosure or on the market yet.

No Mas's picture

You still don't get it.  You shouldn't focus on what "news" should be reported.  It doesn't matter anymore.

Everyone alredy knows:

1. Unemployment is high, very high and going higher.

2. Housing is very bad and is going to get much worse.

3. Data indicates a slow and slowing economy.

None of that matters to someone who wants to make money because NOBODY CARES!! NOT NOBODY, NOT NO HOW!!! (A little Wizard of Oz reference in respect of the great one Helicopter Ben)

You may as well post the daily activities of the current world chess champion, whoever that is, because it has about the relevance to the future of our country or even the world.

Take a dep breath.  Look at earnings; look at the damn market.  What did I say in my first post?  TO THE MOON!!!! Look at the Q's and the SPY.  Come on people, get with it.  You think UPS and CAT are going gangbusters (and will continue to do so) in a sour economy??  I think not.

Life is good; very, very good.  Let's see, up 215 as I speak.  Think I'll go buy another IPad.

wiskeyrunner's picture

Were still below the falling 50 day moving average, relax, how many time have we seen these one day wonders on light volume. Everything gapped open, then rose a tad, wow!

the grateful unemployed's picture

yes except resistance is crushed at 50ma, and another 100 or so DOW points and the 200ma will be crushed, and we will head higher, all done in the first few days, before the public gets on, these moves have little gas left after liftoff, but it gives the talking heads something to talk about all the way to Xmas. (its a matter of restoring the publics confidence, everyone plays their role) call it propaganda, but propaganda is completely einvironmental, understand the propaganda, understand your environment

the grateful unemployed's picture

the stock market is a market, like a super market, and BB has figured out how to make investors hungry. Call it financial bulimia, all that existing housing inventory has been taken off the market, by the banks which cannot afford to value it properly, by the bankruptcy courts, who can't figure out who owns the title.

Don't worry this isn't disaster, this is opportunity. Housing is where the auto industry was several years ago. The auto industry figured out a way to sell three cars, to someone who only needs one. First they sold you that old car, uses too much gas, so you can't afford to drive it, then they leased you a new car, but when you get too many miles on the lease car, you have to go rent a car. And when you travel, likewise, you fly someplace and rent another car.

Three cars, and in the housing future I see everyone with their own house, (and baby makes three) and they will all be owned on the time share system. (A different house for every part of your life, an apartment close to work, where you stay during the week, your home in the suburbs where your wife and family live, several vacation homes. An extra Ipad is nothiing.

There is one caveat, a product eventually loses all its intrinsic value, when the cost of servicing and maintaining the product is greater than the initial investment. Which costs more, the Iphone, or the Iphone service, the big screen TV or the monthly cable bill? at some point the numbers cross, and the manufacturers try to figure out ways to get some of the revenue stream, and give away the product to keep you hooked.


The house is free, but the security, the domestic help, the yard man the pool man, the taxes and upkeep, that's what you are paying for. In the end this bloated housing inventory guarantees jobs for everyone. (who is going to pay?) bad news for factory workers, good news for oversexed latin pool boys.

Malaespina's picture

Please stop your 1cent propaganda, we have enough already vomited out of the public networks.

Cynical Esquire's picture

Dude, I love your act. The great thing about your act is there is plenty of truth in it. Right now very few people, if any, give a damn about anyone or anything other than their immediate short-term needs and satisfaction of the same. You are soooo correct in your assertions that NOBODY gives a damn how many peeps are hurting in this country nor how busted we are as a nation. Our masters have trained us well to not give a damn about our neighbors and to not give a damn about tomorrow. All we care about is what is in it for me and when.. Under this backdrop anything is possible with the equity market, especially from a short-term perspective. If the Dow ramped to 12,000 or faded to 9,000 i would not be the least bit surprised. It is total bullshit either way... I am very happy to have long ago gotten out of the stock casino. i do not have the time nor patience nor connections to play the game.

No Mas's picture

"If the Dow ramped to 12,000 or faded to 9,000 i would not be the least bit surprised. It is total bullshit either way..."

Truer words were never spoken.  We have become a culture (maybe a world) where reality and the welfare of others mean nothing.  The market and its valuation have become a daily proxy for this sentiment.

Homo Sapien; what a speicies huh? 

Oops, gotta go.  I hear Mr. Liesman speaking on CNBC.  Wouldn't want to miss a word of his economic wisdom.  TO INFINITY AND BEYOND!!!!

HEHEHE's picture

"Home sales data was great. On an absolute basis, it's (bad), but, man, it is in the right direction and certainly crunched consensus, and that is great news," said Burt White, managing director and chief investment officer at LPL Financial in Boston."

Burt White does not agree with your assessment. 

carbonmutant's picture

Sounds like the EU is following the Chinese real estate model of manufacturing products without buyers.

wiskeyrunner's picture

I think if you hang out here to much you will miss any upside. One can become brainwashed here. I find it best to remain neutral.

Malaespina's picture

keep the glass full with your cheapo whiskey, you have not grasped one single concept of what is presented here, too much knowledge for too little instruction. Go back to jail.

HarryWanger's picture

I agree to an extent, however, there are some realistic comments making their way through these days. Yes, there are some poor economic numbers that have been coming out but not disastrous by any stretch. And really, you cannot look past some strong earnings and outlooks from major players like 3M, Cat and UPS. 

So while the economy remains weak, it's not falling off a cliff - not even close. Factor in remarks from some of the biggest bellwethers out there and it's tough to make the case that the market isn't fairly valued here.

Cynical Esquire's picture

HW.. what the hell difference does it make whether the economy is falling off a cliff or not? what the hell is the economy anyways? is it 41 million hurting peeps buying their groceries with food stamps at WalMart. is not this activity considered a part of GDP as well as retail sales. is millions of jagoffs bailing on mortgages but still going out to eat a part of the economy. Nobody ever tells me what the hell the effing economy is nowadays. i could give a rats ass what some jagoff company is declaring regarding earnings and guidance. are they selling more stuff or are they laying more people off to meet numbers? is UPS moving more boxes cause economic activity is up or because more peeps are buying on-line instead of at the malls and strip malls? i am doing fine economically but i know a fistful of peeps taking it right in the poopshoot as we speak.

Malaespina's picture

If there is something true these days, this is everything coming out from CNBC, the Fed the ECB, etc are all lies, fabricated with little expertise. Bad bad bad.

LeBalance's picture

Let's be strict for a sec and see where going xXx Austrian (sort of) gets us.

(1) Inflation is an increase in the money supply.  Overall this has been going up rapidly with the bail-outs of everybody and their mommy.  It is sloshing all over the various markets looking for something to buy.  Slosh. Groceries UP. Slosh, This and That UP.

(2) Deflation is a decrease in the money supply.  Not been seen for a long time.  Very long time.  How long, LB?  Well remember before time was invented?  ok, enough joking.

So someone paid $500,000 for a house.  And now its worth $350,000.  That is a price decrease, it has **** to do with the money supply.  The money supply is going UP.  But what does that mean?  It means that there are various markets and they do not all react the same to an increase in money supply.  It means party A made money ($500,000) paid to seller (which DID NOT go away) and party B lost money (bank or owner).  NO money "went away spontaneously" STOP with that "deflate" this and that logic.  The money was transfered into other hands. /#345 pet peeve/

In the present time this is especially true of housing, which was used and abused so badly by the co-caine financial sector that it will be a quarter century before it recovers.  If the FED EVER gets the radioactive MBS off its books.

To read ZH and see people doing this DEFLATION / INFLATION debate when they are taking about the "price market" is ************ and *********.  Dogs barking!

When the price of a watermelon goes up is that INFLATION? No, its a price increase.  It has something to do with inflation, but it also has a lot more to do with markets.

/enough, its lunch time/

trav7777's picture

Some are reporting neighborhoods with more vacancies than houses for sale or rent.

As long as the gov't allows them to hide the losses and not take the marks, they'll hold supply off.  The Fed has their cashflow covered.

the grateful unemployed's picture

do you know about section 8? go to wikipedia..

tahoebumsmith's picture

And lets not forget that the shadow inventory has nearly doubled! Throw in all the people that are either in the foreclosure process " record high" or just squatting and waiting to start the process, the housing supply jumps up to 18 months +. Just like everything else, they are just kicking the can further down the road. When this next wave comes a shore there will be no tools left in the box and we will have to live our lost decade just like that of Japan! Americans have a serious wake up call coming and the only question I have is will it be civil or uncivil? My guess it will get pretty ugly.

curbyourrisk's picture



NO, NO NO.....







juno9604's picture

NAR Chief Economist Lawrence Yun said that month's supply will be over the July data.. and may remain over 10 months for "several months".  The longer the supply remains over 10 months, the lower house prices go.  He also mentioned that if the supply remains over 10 months for more than 3 months.......prices will drop "more precipitously".  Mr. Yun regularly laments the state of U.S. employment and was asked..2 months ago..'if there is not a "surge" in sales in April, May and June, would the U.S. fall into a double dip recession?'  Mr Yun said that was highly possible.....but he did not believe it would happen.   Btw....the Q1 average of Existing Home Sales was 5.14mln; Q2 is at less than a 10% gain Q on Q a "surge"?

ghostfaceinvestah's picture

When Lawrence Yun is negative on the housing market, it is time to be very, very worried.

BigSkyBear's picture

I.F.O = It's Fugging Over!


Bitchezzzzzzzzzz!! ;-D