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Cash And Tarry: Mortgage Applications Plunge At Fastest Rate Since 2009
In the 'old normal' a spike in interest rates would have sparked an avalanche of 'rational' home-buyers and refinancers to apply for mortgages for 'fear' of the 'never-to-be-seen-again' rates disappearing. It seems, however, courtesy of a Bernanke-trained market, that this surge in rates has pushed many to the sidelines (mortgage applications slipped 8.8% WoW and -23% in the last 3 weeks), we presume waiting for the omnipotent-one to save the day yet again. The year-to-date shift in mortgage applications is now the worst since 2009 and the divergence between home sales and application for a mortgage is growing wider every week (reminding us of another euphoria and exuberance-driven unreality divergence).
Worst YTD drop in mortgage applications since 2009...
which appears to be indicating all is not well in the cash-pumped housing market
Clearly not predicated on anything but an easy money grab for a fast buck. It seems the argument that if the fast-money buys it, the slow-money will follow is not working out - instead it is just making it less and less affordable for the average person (again)...
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I'll say it again..
http://www.youtube.com/watch?v=Roayx-79cAs
All about the benjis, bitchez.
I saw that movie at a drive in when it came out in 1972. I don't remember the special effects being that great. Shelley Winters was really fat.
Cause that one is the re-make
I think it was because she ate too much.
And how many movies is Gene Hackman the lead in? One of Ernest Borgnine's best roles.
Agreed. I remember watching The Poseidon Adventure with my mom. I thought Ernest did a great job in that movie.
Hoosiers is one.
This follows up what I was saying yesterday. Expensive new homes costs are probably up (plenty of "wealthy" buyers, but not average joes). Or at least that the number of new homes reflect more of houses paid with cash rather than with mortgages. I think the assumption is that all the charts in a normal state should be together. At a minimum I'd conclude this is anything but an ordinary new housing costs.
So is this bullish or bearish on the home construction sector?
The steady drop in lumber prices says new homes growth ain't gonna happen. Some observers claim that foreclosure workouts are being surpressed to inflate existing home sales, the so called inventory shortage. Banks are sitting on foreclosures rather than take a real beating on the price. The number of qualified buyers who can get a mortgage is greatly reduced because 20% of all homeowners are still underwater.
The housing boomlet now is just a wrinkle in the slowly folding fabric of real estate value.
Shadow inventory is being kept off the market to artificially suppress available inventory for sale thereby increasing sales prices. This is a FACT that directly helps the banks' bottom line as their REO values are inflated. Neat trick, huh?
The thing about an empty house is how it deteriorates as it sits there...rotting wood, termites, rats/squirrels in the attic....bugs, insects...and just plain old decay.
Traditionally, insurance for a vacant house is about 500% of an occupied one since more prone to damage, vagrants, decay, and so on.
The unmowed lawn and broken fences and cracked windows do wonders for surrounding house values and community spirit.
Thing is, none of those losses have to be accounted for presently.
Could be why the TBTF banks stopped foreclosing...No buyers market....
Goddamnit Headbanger, that clip sent me on a 2 hour YouTube Spree...
It wasn't Ben Bernanke who did this but Wall Street. They really believed all that "free money" was "for them at the expense of everyone else." Nay...the have engaged in the greatest deception of all...the one where you deceive yourself. Sorry Wall Street but this is the biggest...if not only sin down there. Government money is just that...Government money. It gets recycled...but VERY slowly.
So when can I take more money out of my home because prices only go up, so that I can contribute to this GDP thingy?
I thought the first housing bubble was pretty nuts but this one is completely batshit crazy.
The Bizarro World has arrived.
Yes I'm sure that there are millions of 65+ year olds planning on buying a house in their neighborhood to rent out. Hey it's housing what could go wrong?
Mortgage applications go way down, but sales continue to go up? These are cash deals? Joe main street is left out?
How much of this is due to investors looking for places to put their money b/c the other investment options are seriously FED-Fucked?
I'm getting daily cold calls from telemarketers wanting me to refinance...
I can only answer the imaginary phone in my cardboard box but they are calling to annoy me there as well.
Does anybody really believe that the Bernank will proceed with any tapering? The whole system will crater if he does, and this is just an early sign.
"Taper" is just the latest buzzword being used much like "green shoots" and "austerity" were thrown around for awhile.
No, they cannot and will not taper without the whole thing collapsing.
Philly Housing Index has stalled after nothing but up since 2011.
http://bullandbearmash.com/chart/weekly-philly-housing-index-hovering-re...
Right around the 62% retracement. Wave C down is next.
I don't care if people are bidding up home prices. I don't care if "investors" get crushed. I don't care who makes or loses money on it.
BUT DON'T ASK ME TO FUND ANOTHER FUCKING BAIL-OUT IF SOME BANK GETS IN TROUBLE OVER IT.
Hedge funds and flippers running wild.
Not fer nothin but they didn't ask the first time and this time will be no different; so just bend over and pay up...
I hear you....but you won't be asked....you will be told!
Hedge funds are buying houses en masse now.
Housing bubble 2 is being formed as I type this.
Exisiting home sales diverged due to foreign oligarcs coming in and buying up property with cash. Don't need no mortgage when one can drop cash on the table.
I guess the Chinese haven't learned how the U.S. refi merry-go-round works yet.
Great charts Tyler!
This guy has some additional data and charts that are good.
http://confoundedinterest.wordpress.com/2013/05/29/mortgage-applications...
clickbait
I'll be moving to where they filmed night of the living dead
I'll be moving to Pittsburgh near the bald crook David Tepper.
I'll be moving where the mesquitos grow as big as bobos
I'm leaving for Pittsburgh in the summer
to a place where we know how to handle banksters and their Pomos.
I'll never buy a house until I get my student loan.
In gloomy muddy filthy fucking Pittsburgh
Artificially low rates have already pulled all the demand forward that exists....
See, credit for clunkers works!
I guess the 'housing recovery' is fuelled by those that don't need wood or mortgages.
We can only hope that Mrs. Green (wasn't it?) is filing her paperwork as efficiently as she did last time so that the FUBAR that we only got a taste of last time will be the real deal this time around and affect all those "investors" who dream of getting rich quick by flipping houses.
+1 for saying FUBAR.
The landlord decided to put my super-cool modern loft apartment up for sale @ $550,000. He paid $551,000 in 2005, and probably pumped another $15,000 into improvements. My rent is $2,000/mo. Let's see, with 20% down ($110,000), and an HOA of $245/mo, someone would have to get rent of $2334/mo just to pay the mortgage. With rental expenses, $2500 just to break even. Yeah, I think it's safe to say that I'll be month-to-month for as long as I want.
Unless. He hasn't paid the mortgage in 36 months.
'
'
'
My landlord sold my super-cool basement apartment in Toronto out from overneath me, selling the duplex of no special consideration in a crappy section of town, for 410K. The neighbour, the other schlub who owns the other half, his 40 x 25 half, he paid 280K 3 years ago! A 50% increase in 3 years.
Yikes! No bubble here!
If the people are lucky who bought this dump, they'll get a 3.5% rate, about $2350 a month. My basement was $950 all in. Everybody's a landlord now, to afford a home, with the cheap money, because the cheap money drove the prices up, which prompted people to put in basement apartments to afford the prices due to the cheap money bidding up the home prices, because, well, keep the circular logic going, everybody put in a basement apartment to afford the prices, due to the cheap money, that bid up the housing prices.
Repeat as necessary.
And the family that purchased it, let's just say I'm betting their taking advantage of our own Sub-Prime debacle, the CMHC, where the banks get to loan out money, and the govy backs the loans if you don't have enough to make it past the post with a downpayment.
Cool if you're a banker, not so much, if you’re the taxpayer and the bubble pops, eh?
And they can sell the mortgages, bundled up, too!? Where have we heard that before, eh?
http://www2.macleans.ca/2011/03/23/a-mortgage-monster/
And when "the taper" happens and interest rates go up by 2 points? That's nearly double so their MP will be… Um-mm… Nearly double?
I'll be buying in a few years… My old place back at about $225. Maybe. $180K?
Do I hear $120K?
•?•
V-V
Buying up homes and playing landlord seems to be an increasingly crowded practice. Crowded trades tend to end poorly when a catalyst rocks the boat and people start jumping ship. There are usually not enough life rafts to go around.
That $2,000/mo. rent seems low for a $550,000 apartment.
No mention of the PMI rule changes?? what happened to the reporting on this site?
http://www.city-data.com/forum/mortgages/1786406-fha-changes-coming-04-0...
"FHA will also require most FHA borrowers to continue paying annual premiums for the life of their mortgage loan."
Correct. FHA has removed itself from the business. Refis on pre-2009 mortgages still get a good FHA rate/PMI but new purchases and refis after 2009 aren't competetive anymore.
The PMI increased to bolster the reserve fund which was depleted from too many defaults. Whocouldathunkit? Next blowup: FHA. Don't worry though, USDA is ready to pick up slack in rural areas with 100% financing.
BOOM! Foreigners pay cash. Your taxes go up.
Here comes the dump part of the pump, dumping 4% cap rate house rental IPOs on Aunt Millie.
http://www.scoop.it/t/precious-metals-investing
Who needs a mortgage when their is a money printer! Thanks BEN!
I got it....THE FED IS BUYING HOUSES DIRECTLY NOW!