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Is Housing Set To Lift Off? (Spoiler Alert: No!)

Tyler Durden's picture


Submitted by Lance Roberts of STA Wealth Management,


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Tue, 02/18/2014 - 18:59 | 4450117 syntaxterror
syntaxterror's picture

Of course housing is getting ready to take off. Guess who's back in the market? All of the persons that were bankrupted the last go round. The 7 year waiting period is over. And they've been living for free for years, so they've got 20% for a downpayment.

Tue, 02/18/2014 - 19:00 | 4450128 johngaltfla
johngaltfla's picture

60+% of all existing home sales in Florida are cash sales to investors. Once again, the banksters are bankrolling ZERO DOWN or 1-3% down loans to "special" first time home buyers. Builders are going nuts putting up overpriced subdivisions again which start in the $400K range, far above the FHA's new conforming limits for Florida.

This bubble will pop just like the real estate bounce did in 1936-1938. And it will be FUGLIER.

Tue, 02/18/2014 - 19:11 | 4450153 666
666's picture

Builders in FL are going nuts building again because all the crap they built over the last 20 years is disintegrating due to incompetent construction methods and materials.

Tue, 02/18/2014 - 19:42 | 4450267 booboo
booboo's picture

"Builders in FL are going nuts building again because all the crap they built over the last 20 years is disintegrating due to incompetent construction methods and materials"

WRONG. So those home just melted into the earth? Someone owns them, rents them, lives in them

Unlike in the 60's and 70's where buyers of that era's homes are having a hard time getting insurance because of aluminum branch wiring, faulty Federal Pacific panels, shitty thin wall copper pipe, footers with no rebar, no hurricane strapping and the list goes on. Don't get me started on northern constuction methods (yea, they use the same material) cause I built up there too.  

Florida is refuge for northern slaves running from their tax plantations, the only problem is when they get down here they start whining about how they do it up north,  yea, no one gives a shit how they did it up north.

Tue, 02/18/2014 - 19:54 | 4450331 johngaltfla
johngaltfla's picture

Florida is refuge for northern slaves running from their tax plantations, the only problem is when they get down here they start whining about how they do it up north,  yea, no one gives a shit how they did it up north.

And worse, they are bringing their commielib retarded voting patterns with them. Florida and Texas will soon look like and be as corrupt as Commiefornia and New Barfyork.

Tue, 02/18/2014 - 21:15 | 4450748 OH10DESERTER
OH10DESERTER's picture

you can ad Zona to the list of states being infiltrated by commies.

Wed, 02/19/2014 - 10:50 | 4452342 Yes We Can. But...
Yes We Can. But Lets Not.'s picture

They've taken Virginia as well.

Tue, 02/18/2014 - 19:59 | 4450357 666
666's picture

I recently inherited a "luxury" condo in FL and am thoroughly enjoying the headaches thanks to plastic water pipes, aluminum wiring, tenting floors, buckling walls and a host of other problems in a unit that is about 12 years old and originally sold for $930K, and is now worth dookie. Although beautiful and in a great location, the quality is so bad that I thought contractors here from NJ built it!

Tue, 02/18/2014 - 19:13 | 4450155 kaiserhoff
kaiserhoff's picture

Call me crazy, but maybe its time to try something different.

How about a free market?  The housing market has not been allowed to clear normally since Greenspan peed his pants in 01.

No one has confidence in housing, because no one has a clue what the actual market price is.  My guess is lower..., a lot lower.

Tue, 02/18/2014 - 20:34 | 4450546 FieldingMellish
FieldingMellish's picture

No other markets are free, why should housing be the exception?

Tue, 02/18/2014 - 19:12 | 4450156 Rainman
Rainman's picture

CA foreclosure starts are up 57% year over year. Smells like something is burning.


Tue, 02/18/2014 - 19:15 | 4450169 new game
new game's picture

and all shit spreads from kali.


Tue, 02/18/2014 - 19:17 | 4450179 derek_vineyard
derek_vineyard's picture

bitcoin had to have been invented in kali.  or at least brainstormed there.  1200 to 250 and dropping

whooda thunk?

Tue, 02/18/2014 - 20:02 | 4450369 Dick Buttkiss
Dick Buttkiss's picture

Excuse me, but outside of Mt. Gox and all its internal troubles, Bitcoin is well over $600 on Bitstamp and BTCE.

Nice try, though.


Tue, 02/18/2014 - 20:30 | 4450527 satoshi411
satoshi411's picture

You can't  get out, of BTC and into CASH.

Nobody can any where on earth.

You can buy BTC all day, but you will never see your hard cash again, ... ever.

Tue, 02/18/2014 - 20:58 | 4450658 Mr. Magoo
Mr. Magoo's picture

Especially when they enact the internet kill switch or bring the grid down, then Bye Bye bitcoin

Wed, 02/19/2014 - 03:20 | 4451640 A Nanny Moose
A Nanny Moose's picture

Burning. Nah, not yet. Wait till summer.

Tue, 02/18/2014 - 19:13 | 4450159 midtowng
midtowng's picture

With this "recovery" being pushed by investors, people forget a basic premise:

investors eventually sell. Homeowners don't (except to buy another home).

Who is going to buy all those homes at inflated prices?

Tue, 02/18/2014 - 19:36 | 4450249 hangemhigh77
hangemhigh77's picture

They won't sell, they're IPO'ing them and bailing. Then all the pension fund managers buy up the rental co. garbage leaving the pensions and muppets holding the bag again.  Same story, wash rinse repeat.

Tue, 02/18/2014 - 19:59 | 4450355 thorgodofthunder
thorgodofthunder's picture

OJ is correct. 






P/E funds run the scam, Wall Street underwrites it, retail suckers get fleeced.  Again.

Tue, 02/18/2014 - 19:23 | 4450198 Lewshine
Lewshine's picture

Charts Farts - Doesn't matter if the world was in a complete housing depression / spiral...Hasn't meant a thing in last 6 years. Why? Because it is NOT what it is...It is what THEY say IT is. Problem solved!

The Fed, The BOE, The PBOC and the various other lords of the system can jawbone a 50% retracement in the world's reality - in seconds! Go back to bed!

Wed, 02/19/2014 - 03:06 | 4451625 Canoe Driver
Canoe Driver's picture

All more or less accurate, except mostly they do NOT have 20% for a down payment. If 20% were required to purchase a home, as it should be, then we would take yet another leg down in residential.

Tue, 02/18/2014 - 19:14 | 4450123 Cacete de Ouro
Cacete de Ouro's picture

"Applied Global Macro Research, an unusually rigorous and prescient group that expects 4% growth in economic output this year and next. The firm's three economists -- Jason Benderly of Vail, Colo., and Carsten Valgreen and Niels-Henrik Bjørn of Copenhagen"

"Yes 4%, we say 4%, why not", said Carsten and Niels-Henrik as the fits of giggles took over.

2 out of 3 economists, who expressed a preference (while thousands of miles away, smoking super skunk in Christiania, Copenhagen) can't be wrong

Tue, 02/18/2014 - 19:01 | 4450129 Colonel Walter ...
Colonel Walter E Kurtz's picture

With the ever growing list of regulations, its seems only the dishonest or politcally connected can get ahead.

Need a complete reset and start this system over again from scratch.



Tue, 02/18/2014 - 19:02 | 4450132 Saratoga
Saratoga's picture

Pent up demand.......Too bad people can't get a mortgage. It will get harder over the next few years due to Basel III.

Tue, 02/18/2014 - 19:02 | 4450134 AdvancingTime
AdvancingTime's picture

I have owned an apartment complex for many years and we are currently experiencing the largest number of vacancies we have ever had. Many houses in the area are empty or under leased. In 2005 and 2006 prior to the housing collapse many people were looking at second homes, for investments or as a vacation getaway.

Today many people have shed the extra home and have doubled up with family or friends reducing the need for housing. We are pushing on a string and calling it demand when someone who can barely pay the rent is encouraged by the government to buy a house they can neither afford or maintain. We have a shortage of "qualified" buyers and renters. More on the topic of housing in the article below,


Tue, 02/18/2014 - 19:41 | 4450260 hangemhigh77
hangemhigh77's picture

That's because all the money went for fleets of yachts owned by Warren Buffrat, Christmas extravaganzas for Jamie Dimon and his kleptocratic dysfunctional tyrannical family, etc.  Insstead of throwing those bums in jail or at least out on the street with nothing and closing the criminal banks down and giving the people their houses free and clear which is what SHOULD have happened, we enriched 400 people to trillionaires and they threw US out of our houses after WE made them whole again.  HANG THEM FOR TREASON!!  HANG THE POLITICIANS WHO COMMITTED TREASON AGAINST THE PEOPLE BY COLLUDING WITHY THE BANKS TO ENRICH THEMSELVES.  HANG THEM ALL!

Tue, 02/18/2014 - 20:42 | 4450593 FredFlintstone
FredFlintstone's picture

Everything made sense pretty much except "giving the people their houses free and clear".

Tue, 02/18/2014 - 19:06 | 4450143 Rising Sun
Rising Sun's picture

Just another day at the shit show.


More fucking bullshit that everything is fine.


Welcome to the land of "we're fukt".

Tue, 02/18/2014 - 19:06 | 4450145 new game
new game's picture

thanks for the update. demand is currently driven by the marginal cash buyer. which will change back to historical pattern.

that and interest rates determine demand...

nowhere to go but....

Tue, 02/18/2014 - 19:13 | 4450154 new game
new game's picture

i was in the market recently, but have decided to sit this out.

i would be one of those cash buyers as i have sold all my real estate-

I cashed out. prices are too high again! loosing 20 k(buying now) pays a lot of rent.

all be damned if my hard earned money will be fleeced by wall street again(cause/effect).

the bastards...

Tue, 02/18/2014 - 19:14 | 4450162 Yes We Can. But...
Yes We Can. But Lets Not.'s picture

Is housing set to lift off?

According to an article about the sharp drop in new-home builder sentiment, housing may not be able to 'lift-off' because there aren't enough laborers to get the product built: "Significant weather conditions across most of the country led to a decline in buyer traffic last month," said the association's chairman Kevin Kelly, a home builder and developer from Wilmington, Del. "Builders also have additional concerns about meeting ongoing and future demand due to a shortage of lots and labor."

WTF?  A shortage of labor in residential construction?!!!

Tue, 02/18/2014 - 19:21 | 4450191 new game
new game's picture

builders play every game in the book to create demand

fake foot steps, lobbyists, complicate shills-the media

also, home loans can be refi's where no sale occurs.

i strongly supect a conspiricy of sorts is underway with the big banks holding back inventory.

that trust appears to be breaking down as it is a mad rush to unload befor the wooosh.


there is no shortage of labor-that is an outright lie...

Tue, 02/18/2014 - 19:32 | 4450206 LaurentDeLyon
LaurentDeLyon's picture

reprise de merde !! mais c'est pareil en France ! putain ils vont bousiller la planète ces connards de banquiers/poloticos/patrons voyoux si on les pousse pas en marche, ils resteront, bon, à priori c'est impossible de changer quoi que ce soit sans couper quelques têtes..


shitty recovery !! but it is the same in France ! fuck, thay are going to wreck the planet those jerks , bankers/politicos/rogue executives if we don't push them off the train, they stay, well, at first glimpse, it is impossible to change anything without cutting a few heads..

Tue, 02/18/2014 - 19:58 | 4450345 Fredo Corleone
Fredo Corleone's picture

La solution est simple: tous les Français ont à faire est d'arrêter l'élection des socialistes.

Bonne chance.

Thu, 02/20/2014 - 05:00 | 4456456 LaurentDeLyon
LaurentDeLyon's picture

oui, on verra déjà les élections municipales dans 3 semaines , ensuite les européennes - j'espère que ça va charcler du socialeux, mais pour ça il faut que 1/ les personnes bien pensantes soient responsables et arrêtent ce délire de vouloir tout redistribuer 2/ pas gagné mais il faudra bien un jour que le système fractionnaire soit expliqué au grand publique !! 3/ stopper la libéralisation/déréglementation mais continuer à avoir des bonnes relations entre pays bon esprit - annexe : le vote musulman joue maintenant en France..

Tue, 02/18/2014 - 19:31 | 4450231 Mr. I-N-The Sky
Mr. I-N-The Sky's picture

Mortgage rates don't mean shit. Put the home mortgage rate at 1% and the fees and charges will just go up.

Go get a quote on a loan and don't only pay attention to your monthly payment but your total cost of the loan.

8 to 10 percent will be the real loan amount. That matters.

Tue, 02/18/2014 - 19:45 | 4450262 pursueliberty
pursueliberty's picture

My total cost on my refi was under $3,500, spread over the 30 year term it isn't bad, just kidding.  Those banks to a lot of work organizing the paper work and emailing me the documents.  It is a rip off.


The real and biggest rip off is realtors at 6%.  They make way more than the banks but do even less paper work.  I'd have honestly thought with technology and the internet this career would have died off for residential property.  Some of the wealthiest people I know are brokerage owners.  Aren't many ways to make 500k+ without a college degree.


I put the money to good use, business start up.  It was either borrow from a bank or borrow on the house.  I got the most bang for the buck out of the house..

Tue, 02/18/2014 - 19:46 | 4450281 skwid vacuous
skwid vacuous's picture

"Tiptoe Through the Tulips" - Tiny Tim, I believe 

Tue, 02/18/2014 - 20:32 | 4450329 itstippy
itstippy's picture

There's been a sea change in "Consumer Confidence" since the housing frenzy of 2000-2006.  

Middle-class people no longer think it's a good longterm financial strategy to borrow as much as possible to buy as much house as possible.  They've realized that houses don't always go up 8%-15% per year in value or that, "No matter what you pay today it'll seem like a bargain in three years." 

Too many people bought into Lawrence Yun's bullshit housing bullishness, and now they're stuck with too much house.  They were easy to sucker into the game because it sounded so perfect - make lots of money by living in a luxurious home!

They're more than a little concerned that their stock-based mutual fund 401K's ain't gonna deliver 8%-15% annual over time either.  

Tue, 02/18/2014 - 20:03 | 4450376 Ms.B.Haven
Ms.B.Haven's picture

I just hit 14 years with my job working for a home builder/developer in central Florida, minus the almost three years I was laid off.  We are a high-end, quality builder in the $400k + range up to over $1m.  There's only the two owners and myself.  All other work is contracted out (and yes, good skilled labor is hard to find - most of them are either too old, gone bankrupt or left the area/industry altogether).  Last winter/spring sales were rolling in, total of seven, good numbers for such a small company.  Four of the seven were cash buyers, one cash buyer from the UK.  Our primary selling season is during the winter months when the snow birds are here.  Foot traffic was good through the holidays and we just closed another contract.  Then, nothing.  Even the ones we thought were serious buyers never followed through.  What I'm saying is in almost nine months we've taken down one contract.  There's another in the pipe line that looks to go firm but that's it.  Something has buyers spooked.  The owners believed all the hype and up until a couple days ago were still spewing skittle farts.  Yesterday I heard the first hints of their worry.  I'm just the lowly office chick buy my radar has been up for months and have been wondering if it's time to start updating my resume, again.

Tue, 02/18/2014 - 20:27 | 4450476 Fredo Corleone
Fredo Corleone's picture

Sure - I know that tune. A particularly fine rendition...

Ruth Etting, 1929...


Tue, 02/18/2014 - 20:37 | 4450563 FredFlintstone
FredFlintstone's picture

Probably wouldn't hurt.

Tue, 02/18/2014 - 20:07 | 4450392 thorgodofthunder
thorgodofthunder's picture

Is American Homes 4 Rent a good short?  Anybody?

Tue, 02/18/2014 - 20:36 | 4450559 Navymugsy
Navymugsy's picture

Short with extreme prejudice!

Tue, 02/18/2014 - 20:16 | 4450444 swmnguy
swmnguy's picture

I bought my first home in 1996, mere seconds before everybody went freakin' nuts.  It wasn't that easy to qualify for a loan, but we did it.  The house was worth about 2 year's worth of our combined income.  Great deal for everyone involved.

Today I'm looking around my neighborhood and I see all these houses going on the market for about $250,000.  Nobody who makes less than $83,000/yr. has any business whatsoever putting in an offer on them.  That's significantly above the median household income.  Of course, if they happen to have a huge downpayment, or proceeds from a starter home they just sold, that's different (that's what I did; I cleared $100,000 from the sale of the first home, so my second home at $226,000 was really only a $126,000 loan; coincidentally or not, almost exactly what the 2nd home would have cost in 1996 when I bought the first home).

So, unless everybody's income in the broadest measures has more or less doubled in the past 18 years, no, Housing is Not Set To Lift Off.  You can tart it up with charts and learned analysis, but if people can't pay the fucking mortgage, the market isn't going to boom unless it's completed buggered up with fraud.  Unless our whole economic system has changed in the past 7 years since the last time we buggered up our entire financial system due to housing-related fraud.  In that case, and only in that case, this time will be different.

Tue, 02/18/2014 - 21:17 | 4450756 highwaytoserfdom
highwaytoserfdom's picture

ahhhhh  Price to income....       Here is the MBS purchases as of last Thursday the 13th

in Millions of dollars 1,532,240 http://www.federalreserve.gov/releases/h41/current/

let me remind you have repos and crony Maiden Lane LLC items that would not have even shown on the sheet unless we
pushed and had 304 congress men vote to audit the FED.... Also the media made everyone of us who loved the country
and demanded the TARP ( TBTF bail out) some kind of TEA bag criminal for defending savings and bond holders...


The only way this thing get solved is vote every DNC/RNC out... HEALTH CARE WAS NEVER THE ISSUE...... The MSM never
covered POTUS FLOTUS puppets making (300-600k) as a hospital community outreach position...

Bookmark the FED sheet and then think before you pull the lever for these kleptocrats. I mean the this balance sheet does not
count the http://www.occ.gov/topics/capital-markets/financial-markets/trading/deri...

These sycophants have put us in a position where the world is pushing for war repatriations for interventions against
a tactics. So this debt is set up for police state and insurance middlemen?

Now 500m from elderly paid for by young? You know Cuba has better health care in general than US and supplies doctors to
S.America.... Doctors are allowed to practice medicine not be an insurance billing asset.

I'm not particularly interested in left right false narrative but unless people vote out DNC/RNC cabal there is not much future
In fact the last 3 POTUS and many members of their administrations are war criminals for torture.

Believe it or not I am an optimistic being in an information revolution. This hegemony has to stop and don't let the war mongers
get there way... These propagandist don't tell you Rumsfeld sold nukes to N.Korea while head of ABB.. We won't even
touch the A&E firms working middle east or defense offense contractor ....... Vote these propagandist out, and start holding the 4th estate
feet to the fire. This is about decency.

"The Rothschilds, and that class of money-lenders of whom they are the representatives and agents -- men who never think of lending a shilling to their next-door neighbors, for purposes of honest industry, unless upon the most ample security, and at the highest rate of interest -- stand ready, at all times, to lend money in unlimited amounts to those robbers and murderers, who call themselves governments, to be expended in shooting down those who do not submit quietly to being robbed and enslaved." Lysander Spooner
(1808-1887) Political theorist, activist, abolitionist  No Treason #6" (1870 ")

$1,532,224,000,000 in mortgage-backed securities $1,532,224,000,000 in mortgage-backed securities. $1,532,224,000,000 in mortgage-backed securities.
Tue, 02/18/2014 - 22:03 | 4450971 pitz
pitz's picture

Time to jail all the bankers, and deport all their H-1B lackeys (including those in the tech sector) who have destroyed enormous amounts of purchasing power for US domestic STEM talent by glutting the labour market.  Nevermind sidelining America's best and brightest by the tens of thousands. 

Wed, 02/19/2014 - 00:09 | 4451397 Ewtman
Ewtman's picture

Case/Shiller data seems to indicate the bubble is only half deflated if you buy this argument. A lot more downside left.



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