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Starts Plunge 9.8% As Housing Permits Miss By Most In 7 Months
Last month's record-breaking surge in housing starts has rapidly reversed and fell 9.8% MoM - the biggest drop since April 2013. Despite a plethora of revisions, single unit housing starts tumbled to 610k - the lowest since July. However, permits were dismal (which is what we should be caring about if we are looking ahead at how the 'recovery' will play out). Building Permits dropped 3% MoM, far more than expected, missing by the largest gap since June. This was the 3rd biggest monthly drop in total starts since Lehman. However, year-over-year, the data is abysmal - Starts rose at the slowest pace since Aug 2011, and Permits at the slowest pace since April 2011.
Permits missed notably...
With Total Housing Starts dropping by 108K, or the 3rd most since Lehman.
Non-Seasonally adjusted Starts tumbled notably more than in previous years...
And single-family starts - with the benefit of a health seasonal adjustment - are back near pre-Lehman levels... but worryingly... NSA single family of 42.4K is the lowest since January's 39.4K
Finally, permits Seasonally adjusted vs Non-seasonally adjusted:
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Friday is humor day!
Yesterday at about 3 PM CDT ... Lowes was nearly empty. It was strange. Workers came up and asked if I needed help at every aisle. It wasn't the weather.
It was the Obamacaare premiums equalling their house payment. No more budgets for home improvement.
How about this for MSM ignorance/spin:
http://www.newsday.com/business/housing-starts-fall-but-less-than-expected-1.6819864
Unreal....
Every sector goes through cycles and takes a breather from time to time.
This is only one more ZH article in a series of thousands going back several yeras stating how bad things are or of an imminent collapse.
Alas, those who stayed away from the markets or worse still - shorted the markets are the only ones bruising and licking their financial wounds.
There is no Collapse around the corner and no repeat of 2008-2009. The Central Banks are well coordinated and on top of things and will not allow any repeat of the drops we saw 5-6 years ago.
Stay with the trend because the markets ARE going higher in 2014. Take into account also the fact that this is an Election year - the Gov will not tolerate anything more than a 3-5% pullbck in stocks.
NO ONE on ZH can even propose a serious scenario for another economical collapse playing out for real. It's all empty speculations and insinuations.
Million Dollar Bonus? is that you? the funny thing about Black Swans like "housing prices have never fallen nationally at the same time" is that you don't see them until they're right on top of you. what you don't seem to get about ZH is Tyler et al.'s 'end of the world charts' is their attempt to highlight those events that might portend a black swan. If you want someone to keep telling you everything is rainbows and unicorns why don't you head over to CNBC or The Street instead of trolling here?
Wait...wait.....I've got this one. Don't tell me, I'm thinking. It was the (unexpected) winter weather....right?
<What did I win?>
Tell, Cog Dis, what he won, Johnny!
Well, Cog, will be styling around the ranch with a brand new snowblower! <cut to picture of a soda straw>
Whoa, hold on a minute there Tyler. Didn't you guys read the Beige Book report from the Fed yesterday? Real estate business is improving!!!!!!! Here's a direct quote from the Fed release yesterday.
"Real estate markets generally continued to improve, according to District reports. Although a few Districts indicated home sales or residential construction in some areas had slowed or declined in recent months, most cited increased residential sales activity and construction as well as rising home prices. Reports on commercial real estate were also positive, with commercial construction generally increasing."
http://www.federalreserve.gov/monetarypolicy/beigebook/beigebook201401.htm
Wait.....wait.....I've got this one. So I'm supposed to suck on the straw....right?
You're supposed to insulfate the straw.... it's loaded with hopium.
beige report thru the rearview mirrror. which way are you going?
no no no, you insert the straw up your ass and melt the snow away with hot gasses !!!
Polar Vortex or "it's bush's fault" are my top two picks.
You know what they say, "If you build it, they (Blackstone) will buy it (with your debt/money that they got counterfeited from the Fed)"
and if it don't work out, well there is whole new class of bond(bag) holder buying the underlying asset.
amazing shit-blackrock has got all bases covered. they are about to turn out the lights and leave the room with there briefcases full of the cash plus. seriously. bonds being sold to underwrite this whole fucking scam...
It was too cold for architects and engineers to walk from their cars to city hall to apply for building permits. Maybe the whitehouse should build obamapermits.com so we can file blueprints online.
You mean to say they didn't adjust them to make them all rosy?
BULLISH!
Report will be a distant memory in 2-3 hours.
What report? What were we talking about?
This is more than just bullish; this is face meltingly, mind numbingly, uber bullish! Yellen should be printing one trillion per month by mid supper at this pace!
Surprise!
I for one am looking forward to the long winter (vacation) that is to come...
if you're talking about a "recovery" 5.5 years after the "recovery" started, is it really a recovery???
We are entitled to this: A hipster nuage meta eco-recovery; accept nothing less!
My brother in law is in recovery from alcohol addiction, but don't let him near an open bottle. Our economic recovery is just a fragile. Its OK on a good day and not so much on all the rest. The new normal of credit addiction.
"It's a recovery if I say it's a recovery." - Obama discussing the NSA domestic spying program.
cog, do yourself a favor-turn it off.
It doesn't seem to be affecting the market in the popular Florida areas. I'm shopping for a new project and since I haven't been able to find anything mini-farm viable at any kind of a reasonable price on the Central West Florida coast I moved my search to St. Petersburg, a city I love to hate. Prices on most of the Homepath repos are above where they were at the 2005/2006 peak.
It makes it hard to jump in. Is the market permanently inflated with devalued dollars? Is another crash coming? I don't think they'll let RE deflate again, no matter how many dollars it takes creating, but it is hard to throw in with this insane lot. I feel the same way about the stock market. Damned if you do, damned if you don't.
And just the opposite with the metals. I don't think they are going to let the metals get off the carpet, no matter what. I wouldn't buy here and I won't sell here. Tough spot.
The game is the same as ever when thinking in terms of inflation. Buy now and hope you pay it off in inflated dollars. Its a game of chance that fewer people feel safe in every day, especially since we now KNOW that real estate prices can go down! The stock market is SO much safer! I think it is because obviously we have seen prices spiraling upward but also there s the belief that you can get out quick, or at least quicker than real estate. We will see. The problem is that people won't get out. They have been lulled into believing it can't go down, just like real estate. Every drop is a buying opportunity until it is just going down, down, down. As stocks are just pieces of paper they can truly go to zero in value where real estate will always have value (unless they become a lead tax weight around your neck).
Obviously you don't own any HL, AG, SVM, ect., as they have been getting off the carpet in the past month to the tune of 10-20% each.
>> Obviously you don't own any HL, AG, SVM, ect.,
I thought "the metals" were "the metals", like, you know, Au and Ag. You are correct, I don't own any stocks.
g beard-in same boat and have a serious heart failure when i get close to pulling trigger.
found a log cabin with 5 acres that could become reality very some. need to meet septic guy and water test. 1650 sq ft, built 2003 5 acres, remote, but close to a casino town...
gse owned...
wish me some luck, others interested too.
>> need to meet septic guy and water test.
I do wish you luck. You are much more cautious than I am. I factor in some unknowns and pull the trigger. I don't test or check nothing and deal with he results later. So far, so good, but I'm not dealing in areas that might have some unsolvable contamination issues. Heavens, if it's five years old the septic must be fine. I bought an abandoned 1968 trailer that I renovated and used the same septic for two years with no issue. A five year old septic is newer than new IMO. And unless you're concerned about possible chemical contamination, well problems are solvable. Don't miss out on a good piece of land over solvable issues.
Anyway, just passing along opinions. Obviously, do what makes you comfortable. I'm seriously astounded at the rebound in prices over the last 1.5 years since I bought this place. I could have bought most of what I'm currently looking at at half of what they are asking now. They are doing a fine job of masking inflation by trashing the metals but it's showing everywhere else.
good thing you got that soil dialed in already for your garden.
makes the waiting game a helluva lot easier ;~)
>> you got that soil dialed in already
Working on it. A boron deficiency greater that what 10-10-10 with trace elements can rectify played hell with my turnips and rutabagas. Absolutely beautiful plants with dry brown interiors. What a bummer. Apparently it also affects broccoli so I'll just have to wait and see how that crop comes out. I'm trying now to get some peppers and tomatoes in the bio-dome so I've got product before the June/July monsoons.
All in all a delightful pastime that tastes damn good.
http://www.20muleteamlaundry.com/
looks like 6-7 tsp per 1000 s.f.
http://homeguides.sfgate.com/borax-uses-vegetable-gardening-27721.html
don't do too much unless you wanna kill your plants!
Yeah, I'm on it bro. Thanks for the tip. It is a precise kind of thing that you have to be careful with.
Fuck housing starts and UPS' dismal earnings, they mean nothing.
?GOT POMO?
Today, yes. Monday, no.
Hedge accordingly.
POMO support will drop by at least another 13% in less than two weeks when the next taper installment hits.
It would be truly amazing if the market went up when it's closed for MLK.
This will only cause the market to go up---there is an initial drop based on this news but every drop results in a springboard at the bottom to higher valuations on the indices. Truly insane.
Dead cats have become boincier.
The best part will be when it dawns on builders that there is no one to buy the houses they built.
So all those construction jobs reported by ADP last week are bullshit.
Housing starts and permits became a useless measure once the publicly traded builders figured out that they didn't need to finish homes or sell them to see thier stocks rocket higher, just say they started more and bought more permits.
Homebuilder equities should be up today as this report will be spun as seasonal!
Who knew cheap credit would draw in the addicts. You have to live in a 500k House and 98% mortgaged according to the Guvment. There is no other wy to live. And Buy a New GM why you are at it . A Silverado for you?
I noticed the three condo projects in my area are all still in limbo.
They've all had pads poured, with those pipes sticking up out of the ground, but all activity ceased back in 07-08.
Someone told me these still count as starts.
In the Fall of 2007, when we had an UnManipulated Mkt, this would have been a clear sign of a Recession coming.
Sept. 2007 Housing Starts had just turned down and the Bond Mkt had just become inverted. That coupled with the fact that the Real Estate Mkt. was in a Bubble Screamed that, at minimum, we were going into Recession in 2008.
But now an Outside Event like the Thai Baht Collapse of 1997 has to happen to bring this thing down. Eventually the Thai Baht Collapse led to the Asian Contagion.
The Emerging Mkts are Collapsing as we speak.
permits should be up as summer season started today. inventory homes it is called. hmmm, HB's a little concerned that mortgage rates up 1 percent from a year ago? recovery? echo fading...
ps. they can subsidize the rates to teaser level with in house financing rates-against the law, bull shit all they have to include is a toothpick with the signed docs-value added ya know. lawyers found a way around the law of conflict of interest.
suprised a tad from my perspective of faux recov.
sold this shit for 20 plus years...
I sold my house. Took eight months and only got one offer, $115k cash. Representing a value loss of only $20k and total loss of $10k in value adding improvements like a new bathroom and HVAC.
I bought my home at the supposed bottom in 2009. The media kept reporting for four years that home values in my town increased, even reporting that values increased 12% last year. All I saw was that the value of my home kept falling as each new home for sale used for comparables sold for less.
My home is being bought for use as a rental property. I wouldn't have sold it for that if I didn't have to. There were no buyers. A young couple was interested at one point but they told my realtor they could only afford $100k.
Sure sounds like a booming economy and fantastic real estate market doesn't it?
And the Abester says that the yen is going to 115 in 2014.
Japan needsd to ship all their crap before somebody puts a gieger counter up close.
Footnote ... Our local community college had a 6% decrease in enrollment --- must be they all got jobs
liquidated both homes last summer and rentg nice 2 br town home for now. playing for a 2nd first home with utility such as a place to make first home if the mrs is game for the woods and all the boogies that come with that-lol.
so if no buyers at my price after fix up, i enjoy...
Well, according to the BLS and its labor calculations, if you are not in the education system, you can't be counted as uneducated anymore, right? BULLISH!
put this in perspective. single family home starts are on a 332000/year unit pace. in the old world one million single family home starts/year was the key metric to watch when analyzing home builders for a trade. that was a SLOWDOWN to one million starts. the business is 650000 starts behind the normal recession performance.
Money will flow from overpriced markets to undervalued sectors now:
CITI Goes Bullish On Miners For The First Time In Three Years
Now CITI joins our small crowd with its bullish call on miners - it is very important development as now these news will go mainstream with the new money being allocated to the sector. Gold is particularly interesting now with the record high Leverage at COMEX of 112 owners for each ounce of Gold and record low level of Registered Stocks. Copper will be gaining attention as well with Chinese biding for huge Las Bambas Copper in Peru making the headlines again. http://sufiy.blogspot.co.uk/2014/01/citi-goes-bullish-on-miners-for-firs...
Oh but didn't you see the newpropaganda this morning- foreclosures are down 53%!!! Woo hoo! Things are really going well! How many homes are still being withheld? How many are sitting empty with no heat that had pipes burst during the artic cold? How many of these houses are going to "flood" the market in a couple of months? Good times ahead!!
Can't we just securitize housing starts and stop using up resources?
JPM BOFA WELLS And GS just posted a 60% that is sixty percent decline in loan originations in 2013!
Recover that!
Try to keep up. In the new Obomber recovery, we are all so infused with the 'wealth effect' that we sell our stawks and buy our houses with cash.
Compare the ZH headline to USA Today's...it's all about perspective...and rose colored glasses.
"December housing starts finish strong in 2013"
"With a strong finish in December, 2013 housing starts reached their highest level since 2007."
http://www.usatoday.com/story/money/business/2014/01/17/housing-starts-d...
Just received my monthly/quarterly Citibank refinance junkmail letter and it was delivered by Fed Ex instead of the post office this time (Citi holds my mortgage).
Cannot decide if this a sign of desperation for Citibank and their mortgage division, or is it a sign of the demise of the USPS?
If this is a recovery , what does the recession feel like?
Philly Housing Index hit 205 last week and closed today at 199.
http://bullandbearmash.com/chart/philly-housing-index-daily-remains-bull...
2005 high was 292 - a far cry from today's 199 - and with record highs in the indexes, what happened to real estate? that's right - there's no recovery and has never been one - just a delay of more economic stress.