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Chart Of The Day: Crushed US Consumer + All Time High New Home Prices = Record Housing Bubble
We must have discovered a new bug in excel, because when we took median new home prices (which a week ago hit an all time high) which we then divided by the average American's purchasing power expressed through real disposable income per capita, we got this chart...
... which is impossible, as it would imply that not only are homes the most unaffordable they have ever been, but that the cheap credit propping up the housing market is bigger than it has ever been in history.
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"MISSION ACCOMPLISHED"
Allow me to interject if I may. Does CONgress know who is going to continue to fund the deficit spending?
http://www.marketwatch.com/investing/bond/10_year
Boom, motherfuckers...
OT - no articles about liberty reserve on here? When are folks going to learn money laundering is only supported by the US .gov when it's through an approved TBTF?
I was just reading about that as a matter of fact...
"In addition to the criminal charges, five domain names were seized, including the one used by Liberty Reserve, and officials seized or restricted the activity of 45 bank accounts.
The charges outlined how the money transfer system operated, offering a glimpse into the murky world of online financial transactions that bounces money between far-flung accounts from Cyprus to New York in the blink of an eye."
Note the way that was phrased...lol...and yes, the article mentions bitcoin in comparison.
"The business operated with even more anonymity, law enforcement officials say, than Bitcoin, a payment network started in 2009 to offer a decentralized way to create and transfer electronic cash around the world. Bitcoin transactions are stored in a public ledger, making it possible to trace Bitcoin transactions even years after the fact."
http://www.nytimes.com/2013/05/29/nyregion/liberty-reserve-operators-accused-of-money-laundering.html?pagewanted=all
Lets be careful out there boppers.
////////////////
What?
I was pointing out how MSM is beginning to frame bitcoin as a nefarious enterprise...or was it the Warriors reference? ;-)
Was very interesting how that article was phrased... particularly the emphasis on child pornography off the top.
I guess HSBC, Wells Fargo etc., have higher standards / quality control to make sure their money laundering operations have nothing to do with child porn and identity theft.
The TBTF money-laundering checklist: Mexican drug gangs a-ok, identity theft - gawd forbid! Standards people, standards!!
lol...good point.
Anything they can't control or see they deem as a threat, both government & the credit system.
I noted Cyprus was also used, continuing with the original "hot money" theme implanted in the publics brain. As if, simply desiring a private (no outside eyes) transaction has become criminal intent or activity.
If you wanna launder money in this town but don't have discount window status, fuggedaboutit!
Or trade on inside information...ala senator & reps trading accounts.
The CIA probably got its funds out before the seizures took place. (See the story of BCCI for the historical analogue.)
In the Soviet Union all dissenters were "insane," but in the "land of the free, home of the brave," they're all connoisseurs of "child porn."
And my bet is that soon ZH, LRC, Mises.org and several more will also be tarred with that brush and then "seized" for the protection of the children I am sure.
What an epic train wreck.
Nassem Talib - things are fine until they're not - break out the turkey story.
When this goes 'BOOM' there will be 'great sorrow and gnashing of teeth.'
Flat mortgage purchase applications. It is an INVESTOR housiNg bubble. See here:
http://confoundedinterest.wordpress.com/2013/05/28/double-double-toil-an...
The Fed! That's who. Load em up and then blow em up!
What the fuck happened to the 30 year today?
Home prices are nowhere near what they were in 2007. Rising yes but not even close to the madness of the RE bubble years.
Median home prices just hit an ALL TIME high.
That is not the statistic. Its NEW home prices hit an all time high. Thats very different than Median Home Prices. Arguably this could say that the market for new houses is being pushed out of lower income affordability.
... or more likely the houses that are being built are concentrated on the high end (income & house price) since only they have the money to afford new.
rest are buying "used" - both reo and other- which have whole different price point which i think is much lower than 2007
so this statistic is misleading of "general" trends in affordability
...and Porsche sales are up as well as Tiffany's.....it just points yet once again to the elites vs the normies....
Words have many meanings.
“In the beginning was the Word and the Word was with God and the Word was God” (New Jerusalem Bible, John. 1.1).
Communication as a form of validating existence.reigns supreme.
The stock market (ongoing QE equity purchases and ZIRP) was planned as a raid on the general economy to force Americans into a stockade controlled by the banking cartel. The money from savings accounts and money lost by retail investors in high risk equity mistakes goes directly into equity buying by the Fed and its bank partners.
U.S. Census:
Period Median Average
Median and Average Sales Prices of New Homes Sold in United States
Jan 2000 $163,500 $200,300
Apr 2000 $162,600 $207,300
May 2000 $164,700 $200,000
Jan 2001 $171,300 $209,000
Apr 2001 $175,200 $205,500
May 2001 $175,300 $211,400
Jan 2002 $187,100 $226,900
Apr 2002 $187,100 $228,100
May 2002 $181,000 $226,500
Jan 2003 $181,700 $230,200
Apr 2003 $189,500 $237,200
May 2003 $195,500 $243,700
Jan 2004 $209,500 $262,100
Apr 2004 $222,300 $269,300
May 2004 $211,700 $260,400
Jan 2005 $223,100 $283,000
Apr 2005 $236,300 $289,100
May 2005 $228,300 $287,400
Jan 2006 $244,900 $301,000
Apr 2006 $257,000 $310,300
May 2006 $238,200 $293,900
Jan 2007 $254,400 $314,600
Apr 2007 $242,500 $311,700
May 2007 $245,000 $309,700
Jan 2008 $232,400 $284,600
Apr 2008 $246,400 $314,300
May 2008 $229,300 $298,200
Jan 2009 $208,600 $245,200
Apr 2009 $219,200 $269,800
May 2009 $222,300 $274,600
Jan 2010 $218,200 $283,400
Apr 2010 $208,300 $270,500
May 2010 $230,500 $281,100
Jan 2011 $240,100 $275,700
Apr 2011 $224,700 $268,900
May 2011 $222,000 $262,700
Jan 2012 $221,700 $265,700
Apr 2012 $236,400 $287,900
May 2012 $239,200 $280,900
Jan 2013 $251,500 $306,900
Apr 2013 $271,600 $330,800
Note: The sales price includes the land
http://www.census.gov/construction/nrs/pdf/uspricemon.pdf
Mortgage News Daily: New Homes Hit Record Median Price in April, Sales Rise - May 23 2013
The median price of a new house sold in April was a record $271,000 compared to a median of $236,400 one year earlier. The average price in the two periods was $330,800 and $287,900. Of the estimated 45,000 homes sold in April 2013, 12,000 sold for less than $200,000 and another 14,000 sold between $200,000 and $300,000. Six thousand homes (6,000) sold nationwide for more than $500,000.
http://www.mortgagenewsdaily.com/05232013_new_home_sales.asp
Big difference between NEW home median prices and OVERALL median prices. Per Calculated Risk Real and Nominal home prices are at 2000
http://www.calculatedriskblog.com/2013/05/real-house-prices-price-to-rent-ratio.html
The only way 'they' prop up the prices are by leivation with zero interest rates, moar zero-down mortgages and tons of incentives by builders. For those who don;t beleive those 'no-money-down' loans don't exist, merely google it or turn on your radio. Hard to believe but true. These are some reasons, among others, I don't see a stable housing price market for years to come.
"Median home prices just hit an ALL TIME high."
So was Zimbabwe stock market as the currency was collapsing in value.
These "all time highs" are smoke & mirrors hiding very healthy inflation in America now. This "all time high" is in dollars debased 50% since 2007, so you can take this "all time high", cut it in half, and that's your true comparison to 2007.
Same with S&P, Dow, etc. Cut those numbers in half and there's your true comparison to 2007 highs ...and it doesn't look good. Dow would have to be 28,000 today to match 2007's 14,000 high.
Inflation (currency debasement) is a wonderful deception, fooling all the sheeple out there, even some here on ZH, distracted by rising charts, thinking they're getting ahead, not seeing the devalued dollars, not realizing they're breaking even or losing.
Oh, the government got it wrong then...
thou shalt not contradict the Tylers...
"thou shalt not contradict the Tylers..."
What? I didn't know they were infallible. I guess I better start praying to them before bed every night.
Not infallible, but a little sensitive perhaps, they've kicked people off this site for less.
If you adjust for inflation, then yes, its waaaaay down from '07.
<deleted>
Technically this could just indicate that the only "new" homes that are being purchased are EXPENSIVE houses. Means that us po foke can't afford a NEW house, just the used ones.
I could correlate the amount of shits I took last week with the number of MBS bought by the fed and conclude that every time I crap Bernanke buys a 10 billion worthless mortgages. If only I ate less the economy could rebalance itself. Unfortunately my exrement doesn't prove causation or correlation, they're just 2 numbers next to each other. This chart does show that while median disposable income dropped, home prices went up, but it doesn't take in a massive amount of factors like foreign invesment and geographic considerations just to name two.
Agreed. As far as I know, where I live there are no Chinese outbidding each other in cash sale of homes.
First, this is median home price, as in the middle number in a set your points are the reason average price wasn't used.
Second, the ratio speaks of the affordability of a new home to an average person. The reason for the disconnect is in no way analyzed in this article.
So to summarize, that's not your shit, that's you're brain, so pull it out of the toilet and shove it up your nose.
You nailed it. The primary people driving the new home market are the top earners. They are doing quite well in this economy. Housing tracts for the great unwashed are no longer being made because there is more than enough recycled homes for them to buy or at least rent. I'd love to see the stats how the market has changed (if it has) in the percentge of new homes commissioned to be built versus those built on spec. Also of interest would be changes in square footage and other measures of the quality of the new home. Only the elites need apply.
There are no "elites" in the US, only the middle class. If you can't afford to buy a new house, you're not middle class. The economy is doing great for the middle class.
A rose by any other name may still smell as sweet but an elite by any other name is still a vampire squid. I really don't mean that. It's hard for me to judge many of the ones prospering today but the ones on the lower rungs are much worse off today than the last time the chart spiked like this.
Spot on... just imagine the magnitude of the hedonic adjustment factors that could be applied to housing prices if it suited the government to suggest that real estate prices weren't increasing.
yeah no shit. impeccable in both presentation and simplicity. also goes a long way towards explaining the explosion in disability payments. "keeps the housing market alive." paying down debt, keep working on that camp as prices start falling for building materials...keep that zero interest rate regime going as well. here's your first suburb Planet Earth: http://en.wikipedia.org/wiki/Levittown,_New_York so while you're on your way to the Hamptons this weekend this is place you need to ponder. amazingly..."they didn't even come close to building it big enough." here's the place that got it right: http://www.trulia.com/real_estate/Washington-District_Of_Columbia/ that was the first real estate boom i actually witnessed first hand as massive amounts of perfectly good farmland got turned into McMansions...everywhere. the second was "the entire West Coast from Seattle to Olympia Washington" from 1994-1998. the "affordability index" wasn't any better there either. this is PURE mania stuff...there has to be a reason for such price action (almost always involving Government action...and i ain't talking interest rates...the new sports complex/public transportation hub in Brooklyn is a good one) and simply put...we just have too much debt that we're paying down here plus almost nothing to show for the hundreds of billions "already spent" at the DOT.
Average is not the same as median. Median is the price where half the homes for sale are more expensive and half are less expensive. Average means the total value of homes for sale divided by the number of homes for sale. The value for average could be skewed by a small number of very expensive properties. Be careful with statistics!
our insurance co jumped the cost to rebuild about a third. there is of course little or no market at that price. this is the 2007 bubble without any buyers. remember how government propped up farm prices in the 30's, farmers couldn't sell their produce, so they plowed it back into the soil, then they were evicted for taxes. substitute farm prices for home prices.
No F'ing way! I better buy now before I am priced out of this red hot market...
This is probably the best piece of advice I have seen in some time. Get em while you can folks, they are not making any more land you know. In fact, I would buy three or four if you can swing it. This bubble is just getting started, plenty of room to run.
Land reclaimation is going to be all the rage in the next few years especially properties of 'value' for the few that can afford new single family homes after the old properties are demolished. The rest of the people well fuck em they can go live in the new apartment complexes, like they used to do in certain other centrally planned countries like the USSR.
It is already standard practice in booming metros, they call them tear downs.
Catherine Austin Fitts says that this is how it's done, they run things down in order to kick folks out so that they can buy up properties on the cheap.
I got so fucking tired of hearing all the clowns in my old (small) city talk year after year about "rebuilding the downtown core." Many parts of the city were treated like unwanted step-children while these "leaders" (pols and bankers) talked about making "everything" wonderful.
But let's be honest here, WAY too much is unsustainable. That's the reality. Many people are unable to maintain things (the "System" doesn't want you to really think of these things up-front lest it discourages you from spending MORE than you should be for a property), in which case it would pretty much be inevitable that the property end up in significant disrepair.
Flippers paradise!
Oh, it's just Happy fuckin' Days all over again now.
http://www.youtube.com/watch?v=3F82EiIByqY
Chart addiction
big time
That's BULLISH, right???????
Well...the 10yr is at 2.15% right now.
what to do what to do what to do....
Wait 6 months and punt.
A PnF chart on the 10Y UST tells me that 2.25 is heavy resistance. So, technically thats a reason to buy around there which would be consistent with borrowing costs effectively doubling on US Treasury debt. This is not an option for the government, for any government right now. Borrowing costs have to be kept to a minimum. So, I say the 2.25% holds and back down the hole we go.
http://stockcharts.com/def/servlet/SharpChartv05.ServletDriver?chart=$ust10y,pltad[pa][da][f!3!!]&pref=G&pnf=y
It's the too big to fail mentaility: If the last bubble scared them, this larger one will have them eating out of our butt cracks.
Bubble times are here again!
Oh, bubble times are here again...
Bubble times are here again...
Bubble times are here agaaaaain!
Sing it with me!
...
Well Commander J in Vegas is reporting in. I have some free time on my lunch break so I thought I would toss my .02 in. I was going to post this in the "TIIIMMMBBBERRRR! lumber post, but this one will do.
I can see the housing sector starting to spring into life after the great recession around town. Homes sprouting up like weeds again. And whats crazy, is they are building more homes while there is soooo many foreclosures and short-sells on the market. Its insane. I'm happy that this time they are not building all the C-2 building as there is still a massive glut of those in town too. I talked to a owner of a couple C-2 commercial properties, and the vacancies run about 30% right now. Alot of wheelin' and dealin' to keep tentants in them.
Myself, I would love to see the Las Vegas market get Bubblicious again, so I can unload my rental and make 100k. People don't learn and I will gain while others lose. About the article, I have seen more higher end homes being built here in Las vegas. Alot of 2500-4000+ sq. feet homes; McMasions or some shit like that. I think its for foreign buyers, or people cashing out from richer areas/states moving here. The weather is nice for 10 months of the year, and the tax atmosphere is pretty cheap. No state tax, low property taxes. Did I memtion no SNOW? Also some crazy number, like 10,000 people retire each day in the U.S. (boomers),......they are going to go to warm climates, i.e. Arizona, Nevada, Florida. And hummm...... isn't that where the next boom is? ( Minus San Fran and the next dot com boom/bust).
I have been looking into a new area to move, vacation home, and retire. Looking into low tax areas and a area which I can farm. I think I'm ready to live a more rural lifestyle. My mom is willing to go too. Just need to work on the wife. We are planning to do it in about 10 years. I've narrowed it down to a few states, based on state tax rates, property tax rates, and farm land. Its Nevada, Washington(state not evil DC), Colorado, Wyoming. Any sugestions? Comments? I want 20-100 acres, water source, trees would be nice, secluded. Zone 5-9 for growing food. My urban garden is making me want to grow more. And have some livestock.
Thanks in Advance
J in Vegas
Wow, I can't even believe this is possible:
"I can see the housing sector starting to spring into life after the great recession around town. Homes sprouting up like weeds again. And whats crazy, is they are building more homes while there is soooo many foreclosures and short-sells on the market."
Last time I was out there, I visited recently built ghost towns, entire developments, which were empty. It was VERY creepy! I remember one outside Henderson, some around Red Rock, a bunch on that highway up towards Parump (sp?), WTF? Did people move into those places now? Are they building even with the existance of those ghost towns? Crazy!
"I want 20-100 acres, water source, trees would be nice, secluded. Zone 5-9 for growing food. My urban garden is making me want to grow more. And have some livestock."
I'm on that path. It's not easy, but then again life ain't going to be getting easier.
Focus on: Food, Shelter and Water.
Ensure you have a good water supply. And be prepared to be your own water-treatment scientist and operator: I've been learning via rehabbing an existing well [on my own].
I always had trees on my "required" list (though I'm up north I'd still figure this to be good advice).
Unless you have a LOT of money be prepared to have to do a LOT of work to make things workable. Buying ready-made farms (if they aren't trashed- soil shot) will be tough without a lot of money: as someone who didn't have a lot of money I can appreciate the true value in developed farmland.
I'm toward the middle range of your acreage range- 40 acres. Without a tractor I'd find life nearly impossible (for what I have to do [refer to my preceding sentence]). Tractor, chainsaws, diesel truck... advice is to be mechanically able (I've been this was since my youth, though I tended to pay for others to do much for a good portion of years between then and now).
Every area has its good points and bad points. I did some looking around in Eastern Tennessee- I really liked it there, but it didn't work out. And rural is rural because it's not highly populated; meaning, there's generally a reason why it isn't highly populated- those who don't understand this can be in for a shock through experiencing it (reasons are plenty).
I'd say that 10 years is too far out. I don't think that things are going to wait for you. Further, it would be good to be somewhat established/settled in a rural community BEFORE TSHTF.
My last wife wasn't on-board. She left: and, ironically she gets it (we still communicate). My current wife kicks ass. Without a great partner that is on the same page with you (and you with her, or him) then a hard life can become a huge struggle.
Oh yeah, get a good dog or two. It's always nice to get an advance notice for when you might have to take up further security actions.
This looks bubblish to me!
Surprise surprise, but everything is sunshine and lolipops. The man in the dirty green van offering free money said so.
The data is skewed. The only homes moving are the real high end or low end slums. The stuff houses in the middle are just sitting.
@Dr. Engali
That and geography. Tyler pointed out earlier that Phoenix, California and Nevada are hotspots (just like 2007) and Detroit is not hot.
Second geography. FL is nowhere near the old prices and associated manias/bidding wars.
But was that for new homes only, or both?
Also, I'd thought that it was mentioned that Detroit was up (though "only" 18%- when it's near the bottom anything can look like UP).
Average sale in the city has gone from 11,200 to 13,200 (+18%)
Yup, read all about the reflation of the SoCal bubble by following Dr. Housing Bubble:
http://www.doctorhousingbubble.com/
Interesting analyses, I watched the bubble reflate by following the blog over the last two years.
Don't forget the Balt.-Wash corridor fed by gov't money, fed and state.
I am very interested in seeing the JBG market tonight. If treasuries are falling apart Japan has no chance at stability.
It will be interesting to see if the USD/Yen holds above 103 or if they intervene there again.
This market is making a total asshole out of me. now the div payers are selling off. only hot dogshit is up today. Brutality
Dividend payers selling off makes sense with the ten year creeping up. Anything making sense in this bastardized market is a rarity.
it does make sense. the problem i am having is i don't own many shitbag stocks which are the only things working.
the question is, if money keeps flying out of treasuries, where does it go.
Another question....many of the bond funds now own stocks...so who the f owns any treasuries anyway?
33 Liberty Street.
Creeping up? The ten year is up 20% in the past month!!!! That's the stability of the most liquid market in the world for ya!
Something's up, hey congress, you better start buying bonds;
http://www.marketwatch.com/investing/bond/10_year
Tapering.
Kuroda is speaking @ 8:00 p.m. est. Today Fonz. That's always good for some disruption. He's the Mervyn King of Asia.
i don't see how he gets the toothpaste back in.
He doesn't, neither does the fed without hitting equity markets. This shit is about to get midevil.
Might as well buy a house now if you need a place to live. When the SHTF soon, do you really think you're going to be evicted? Wells, Citi and BOA just stopped foreclosures again, so no.....
But if your house is paid for, then watch out that you don't miss paying your property taxes by even a penny, oterwise you will be sure to unleash the local tax goons who will be looking for a nice unencumbered house /money pit to auction off to raise revenue to feed their fat fucking faces.
Or better yet, now that you have seen the foreclosure BS for one complete cycle, get into a big house and forget about paying anything. The town tax collectors won't be as eager to foreclose if there is no money in it.
cursive - you might actually have a point there. myself - i have too much cash in banks to pull that off - they'd take my money first and then the house, because i hope to continue to have income. it's really only the people with no income - there's nothing but the snap cards to garnish - so why bother?
What a f'king joke this country has become. What a bunch of turds running it to the ground.
So simple to get back on track, just close the 5 largest banks. 95% of all their derivatives are against each other anyway, it all nets out. Put them in receivership, liquidate assets in 5 years, immediate liquidity to deposits of less than $100K, vesting schedule for larger deposits. If you are dumb enough to have money with those crooks, you deserve it.
With BO in charge (well, with Rubin and Summers in charge, BO as the puppet) and Holder as "justice", never going to happen.
Crooks.
The implcations are deeper.. this is crazy. Perhaps it speaks volumes on the degregation of the haves and have nots..too many have nots not able to afford a new home.
please source. otherwise Kirchner's army of unscrupulous data scrubbers could be behind the post. thanks TD.
Neighborhoods owned by hedgefunds, good luck collecting rent bitches!
agreud. rents are insane. section 8 must pay really good because omg rent has got to hurt if one pays for it out of pocket.
Just keep reciting the mantras, over and over. Do not think, do not take into account the constantly changing landscape. Any information that does not agree with the construct must be ignored. There is nothing to learn, we already know it all as well as knowing the future.
Nothing can change, the static model will tell you what's coming, and nothing can change it.
(sarc)
No wonder only 3% of the population is financially independent at retirement time.
(not sarc)
This chart goes up, that's good...right?
Don't get your knickers in a twist on this.
No one is buying their own homes, they are renting from Blackstone et al.
oversee investors perhaps?
Banks are making out on this ride. Lets see, Origination with the asset, sold the mortgage to 15 different investors and kept the asset, TARP, kept the asset, QE forevah, loaned the paper to the FED but kept the asset, finally pumped up the market and sold the asset. I know I am missing a few links in the chain rape but you get the point. Now, wash, rinse repeat in 2015. What a country.
You forget where they collected CDS on those fifteen sales, when the RMBS trusts were
downgraded.Apart from that, pretty accurate.
Honestly, where do you think that $30tn in the Caymans came from ?
in Florida, yes. In California and the West Coast in general...yes. "but do they take delivery" i ask. i say "no." as such this is just hot money...pure speculation. if the Fed busts a move...or worse...the market just tops out..."look out below."
Where's the chart that shows all the shadow inventory that banks are holding back to give the perception of demand and tight supply?
I wouldn't buy any real estate right now. Lean and mean is my motto. Gotta be adaptable and liquid in this giant 'time bomb', getting ready to explode.
I've got to sell some property for an estate and would like for you to hold that chart until I've got the property sold. Thank you!
lol ;-)
Numerator in nominal terms, denominator in real terms--nominal disposable up from $34.6k to $38.2k... distribution of those dollars aside, the chart is useless if the accounting conventions are apples and oranges.
Perhaps, but I think the trend is what matters. so long as the numerator and denominator remain the same items, the trend shows a bad pattern.
It's sort of like any government stat. you can't believe the real number, but you can discern something from the trend.
Correct, I'm glad someone else noticed.
BULLISH, BABY!!! I see green people.
it all remains to be seen if the banks will accomodate the Feds bubble, by opening up equity lines of credit, because there is no way that new home buyers will see this as good news.unless maybe the government gives tax rebates, or loans which pay interest (i took out a loan and i get 2% a year so i can buy this overpriced home) and who pays that 2%, the buyers of treasury bonds who buy negative yields. again no change needed, just keep fed policy on its present course.
The price may be higher but the mortgage payments are not. House prices are a direct reflection of interest rates and the payments required. As interest rates go down the ratio is bound to go up. measure it in monthly outlay vs. purchase price and you have a different story.
I disagree. The mortgage payments haven't gone down. As interest rates rise, home prices fall. Inversely, as interest rates fall, home prices rise. You're close though. Do monthly payment (including interest and principle) vs. real income, and you'll see what true picture is. I still say house prices need to fall another 20%.
Close to the lows according to the Economist:
http://www.economist.com/blogs/dailychart/2011/11/global-house-prices
Come on guys throw away excel or at least use it to chart fantasy island
Anything is possible in the land of Oz
Don't forget to have Banzai7 create an image for the post to include Mr Roarke (Bernanke) and his midget sidekick Tattoo (Geitner)
I think this is a bit bias... don't think the Real inome in 2005 dollars compared to nominal house prices is rational.
People have been using their meager savings and investment returns to put food on the table.
So what is wrong with using bubble returns from stocks and your 401(k) to fund your bubble home?
Oh.
There is a house up the street from me that sold in the low $70k range just three years ago, that is now priced to sale at $95k. I can only assume that gold-plated toilets have been installed in the house to justify such an increase over a short period of time.
The house next door to mine - which is identical to mine - has seen its price drop from $87k to $47k since it was put on the market a year and a half ago. The asking price is now $10k below what I paid for my house in early 2010.
Peak stupidity and/or greed.
Yikes,under 100k for house? In my parts he lot starts at 250k and up from there!
Helped along by GSEs like Fannie Mae...
http://www.latimes.com/business/la-fi-fannie-mae-kickbacks-20130525,0,6280041.story
that guy is in handcuffs meanwhile franklin raines is laughing his ass off.
With lowlife WalMart being the biggest U.S. employer,I don't imagine the demand is coming from folks forced to work for less than 10 bucks an hour.Must be all the corrupt commie money fleeing China.
Then again, it might be China dumping all their unwanted FRNs.
This chart doesn't mean much besides the gap between rich and poor is ever-growing, which we already knew anyway. The volume of sales is WAY down since the bubble, and only upper-middle and upper class people are buying new right now. Low supply and increased demand from the 5-10% of people whose incomes are actually rising results in the spike shown in the chart. Versus in the old bubble when EVERYONE'S nominal income was rising, and there were all kinds of housing (new, existing, low, middle, high, etc.) spiking in price.
If sales volume was getting back to 2005-2006 levels, and existing home sales prices were hitting records, then this would definitely indicate a new (and bigger) bubble. This doesn't mean that it won't happen soon...
In South Florida, for the first time in years, property, yes even low-end property, is starting to move. Many low-end properties in my area that have been un-occupied for years have now been sold, and, a few higher-end propertities in the area that had been occupied, are now un-occupied and languishing. I am also having some problems renting some of my units down here.
Something is going on in the market for sure, to me it looks like a recent uptick in sub-prime lending again down here, to the point that it's actiually affecting the ability to rent units.
Your milage may vary of course, I am just speaking from my personal experience in the current market.
Of course, with overcapacity in RE, rents will trend towards zero. Do you really think the laws of economics were repealed?
maos dog - what is happening is this. the 'private equity firms' - blackstone, fortress, cerebus are borrowing from the fed for basically nothing, buying this stuff up - creating front 'rental management firms' - promising great profits - this will be securitized and sold to you pension fund at a 'nice' yield and then the whole thing will blow up. and it's all from front to back funded by taxpayers - because 1 - they borrow for nothing from the fed. 2 - the majority of the renters are planned to be 'section 8' - welfare. so the tax payers are paying the rent. and then - when the 'bonds' that your pension fund bought that aren't worth anything need to be bailed out - guess what? they will bail out your 'savings' (that pension fund) with your current and future earnings. it's nice to be a private equity firm.
Looks like as always the plan is to make Rents go up to the level that all renters will be frustrated and will end up buying and as soon as builders start building new units the sellers market will convert back to buyers market - and boom - 2007-08 crash all over again -
What kind of nonsense recovery is this ? The quality of life in an owned home is no better than rented home unless you are having kids. With fewer new family starts - I dont see any increased US demand for housing - the reversion to mean in 07-08 has been erased by Uncle Ben and the superleverage a$$hattery is going to take down the economy again - I would bet the next crash will be around the time of the next Olympic games.
It all depends on the location. I'm planning on buying a few rentals in a small town that is getting a new factory next year. 3 bed rents are a solid $800 monthly - the house I want to buy is $33K. So why don't more lower income people buy the houses that are under $50K you ask? Because they all need about 5K in work and have the electric shut off - which means you can't get the inspections required by 99% of the lenders. I would love to do a rent to own where it's a win -win between me and the renter.
So for an average family, with two incomes a house can be paid off in 8 years. Not too bad.
when's the coup ?
Since there is no inflation, says Uncle Benny, housing prices can rise another 20-30% because the market is not saturated with buyers. It is a rather thin market compared to 2005-2007. Buy everything in sight!
Housing bubble 2.0? = Housing Crash 2.0?
If you are buying a house believing there is a recovery and you are planing to hold it you are going to get DESTROYED!
If you are buying and flipping hopefully you can flip before this mother blows up - because it IS going to blow up
Charades sont rugueuses sur les consommateurs.
"44% of Homeowners With a
Mortgage Can't Sell"
Shanthi Bharatwaj, Zillow, 5/24/2013
http://www.thestreet.com/story/11933280/1/44-of-homeowners-with-a-mortgage-cant-sell-zillow.html?cm_ven=RSSFeed
"Underwater homeowners
find they've become
accidental landlords"
Diana Olick cnbc.com, May 24, 2013
http://www.nbcnews.com/business/underwater-homeowners-find-theyve-become-accidental-landlords-6C10064290
http://pages.citebite.com/c1e7w0g5t0rar
http://www.truthdig.com/eartotheground/item/the_housing_shell_game_20130503/
http://www.zerohedge.com/news/2013-05-21/goldman-confirms-recovery-hopes-have-gone-slowdown-deepens
http://www.businessinsider.com/keith-jurow-us-housing-recovery-mirage-2013-4?page=1
http://pages.citebite.com/v1i5c9f0h7akf
http://finance.yahoo.com/blogs/daily-ticker/housing-bubble-2-0-david-stockman-133026817.html
http://www.cnbc.com/id/100435276
http://www.banks.com/articles/foreclosure-starts-surge-32-states
(I think this and the mortgage release program
http://goo.gl/kb1XL
will actually start to hammer on the r.e. market.)
Though, Tyler himself now shows why the charade is still on.
http://www.zerohedge.com/news/2013-05-28/keeping-recovery-dream-alive-3-big-banks-halt-foreclosures-may
http://www.zerohedge.com/news/2013-04-10/housing-recovery-shifts-contraction#comment-3433151
http://www.rickackerman.com/2013/03/real-estate-bounce-setting-up-a-second-crash/
http://www.zerohedge.com/news/2013-05-22/mortgage-applications-have-biggest-may-collapse-financial-crisis
http://www.zerohedge.com/news/2013-05-21/housing-unrecovery-here-lumber-enters-bear-market
If you are a foriegner holding a ton of unwanted FRNs, what else do you buy but capital goods and property with it.
you also have to take this chart into consideration: http://research.stlouisfed.org/fred2/graph/?graph_id=122350&category_id=0
Humanity is fucked.
Out of every possible economic delusion that it is possible to have, the most destructive and pernicious is the idea of infinitely rising housing prices. It impacts everybody and leaves no section of society unscathed. And like a bad joke it just keeps getting repeated and repeated.
And people just can't seem to realize that their wish, for their home to keep rising in value, is the road to complete serfdom.
Getting people to overpay for a roof over their head is the ultimate coup d'etat on the part of the financiers. It turns everybody into either speculators or renters and makes a mockery of property ownership. It distorts all economic activity and destroys all family and social bonds.
It is basically a corrosive acid that, once unleashed, has the potential to bring entire nations and civilizations to ruin.