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Pending Home Sales Tumble From Recovery Highs, Biggest Miss In 2014

Tyler Durden's picture


Following last week's collapse in new home sales (and last month's massive beat and surge in pending home sales), it was likely not a total surprise that pending home sales would slow, but the -1.1% MoM print is the worst in 2014 (and the biggest miss in 2014). The median existing home price continues to rise (up 4.3% year-over-year) but this is the slowest rate of gain since March 2012. NAR is quick with the excuses and this time.. no weather is to blame.

From biggest beat to biggest miss in 2014...


And the excuse train is here...

Lawrence Yun, NAR chief economist, says the housing market is stabilizing, but ongoing challenges are impeding full sales potential. “Activity is notably higher than earlier this year as prices have moderated and inventory levels have improved,” he said. “However, supply shortages still exist in parts of the country, wages are flat, and tight credit conditions are deterring a higher number of potential buyers from fully taking advantage of lower interest rates.

Yun forecasts existing-homes sales to be down 2.8 percent this year to 4.95 million, compared to 5.1 million sales of existing homes in 2013. The national median existing-home price is projected to grow between 5 and 6 percent this year and in 2015.

Some context...

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Mon, 07/28/2014 - 10:10 | 5012399 firstdivision
firstdivision's picture

Don't worry, I believe the Fed gets its new 3-D printers installed, so Janet can now printe dollar, houses, and dildos.

Mon, 07/28/2014 - 10:12 | 5012406 espirit
espirit's picture

Meh, negative numbers will be the new normal.

Get ready Bitchez.

Mon, 07/28/2014 - 10:34 | 5012484 Doña K
Doña K's picture

Wait a minute! Isn't hot weather too hot for house hunting?

Mon, 07/28/2014 - 10:48 | 5012538 Liberal
Liberal's picture

As a staunch liberal, I'm here to tell you that the truth is we're just not taxing people enough. Housing would pick up greatly if we threatened to tax people 95% of their income UNLESS they buy a house. That would really boost our housing sector.

More homeownership = Bigger Property Taxes = A big raise for meeee!!!

Mon, 07/28/2014 - 10:51 | 5012553 The Most Intere...
The Most Interesting Frog in the World's picture

I've oft suggested attaching electrodes to genitals and applying increasing shock to said parts until desired purchase is made (to clarify, government desired, not necessarily desired by the consumer).  This would solve a lot of problems.

Tue, 07/29/2014 - 11:10 | 5017763 papaclop
papaclop's picture

You're wrong about deflation. All the central bankers know is print,print, then print some more. You can't have deflation with trillions of dollars swirling about. Get some gold, bitchez.

Mon, 07/28/2014 - 10:22 | 5012448 Soul Glow
Soul Glow's picture

Does anyone own MBS other than the Fed?

Mon, 07/28/2014 - 10:50 | 5012547 Liberal
Liberal's picture

Yes. After getting a big raise from President Obama, I plan on getting a new Mercedes Benz S-class soon.

Mon, 07/28/2014 - 19:01 | 5015015 dryam
dryam's picture

Doesn't this concern anyone else?  As people default the Fed will steadily become the largest owner of houses in the U.S.  Am I missing something?  A made up entity that started with zero dollars is progressing the being the largest owner of tangible assets in the U.S.

Mon, 07/28/2014 - 10:49 | 5012541 The Most Intere...
The Most Interesting Frog in the World's picture

A female blow up maybe, but not a dildo.

Mon, 07/28/2014 - 15:20 | 5013947 Eireann go Brach
Eireann go Brach's picture

Retarded 2nd mortgage lending is back!!!! TCF bank is now offering 2nd mortgages to 90% of a homes value here in CA! Not hard to figure out these 2nds will go bust once the next housing down turn hits.

Tyler I think this deserves it's own post!

TCF Bullet Points Info -



TCF DOES NOT OFFER FIRST LIEN HELOCs – HELOC must be in second position behind new first mortgage (purchase or refinance) processed and originated by your firm. 


OWNER OCCUPIED ONLYno second homes or non- owner (investment) properties 


No non-occupant co borrowers 


Single family homes, condos and O/O duplexes OK.  No triplexes or fourplexes.


No I/O’s –OK behind amortized  ARMS –TCF qualifies at First Lender’s Qualifying Rate.


Cannot have more than 6 “non subject” properties – financed or free and clear



Max 89.99% CLTV*-  for Combined liens of $750,000 or less


Max 85.00% CLTV- for Combined liens to $1,275,000.   Max HELOC $350,000


*Condo guideline change!  Max 89.99% CLTV OK for Condo  Purchase or Refinance!!



TCF Pricing

80.00% CLTV or below     Prime + 1.49% = 4.74% (start rate based on Prime@3.25%)

80.01% CLTV to 89.99%   Prime + 1.99% = 5.24% (start rate based on Prime@3.25%)



HELOC Terms-10 year draw period  with min I/O payments; 20 yr repay period;

18% Life cap $75.00 annual maintenance fee.  Early Termination fee has been eliminated.


Borrower can have full draw, partial draw or zero draw at closing!



TCF will use your appraisal, subject to a TCF ordered Desk Review.

Appraisal cannot be > 90 days old at time the AMC performs the Desk Review.

Desk Reviews ordered on all loans regardless of CLTV; turn time is 5 business days.

Property purchased less than 12 months ago –use lesser of acquisition/current value.



No Title Insurance required for Simultaneous Close HELOCs with line of $250,000 or less.  If HELOC >$250K, TCF requires a Jr.Lien or Flag Policy covering full HELOC.



Minimum mid Credit Score- 700 for Combined liens of $750,000 or less-primary wage earner only!  720 for Combined liens > $750K:  No min score for Co-Borrower.   Arizona transactions – 720 minimum mid score required.



Max Ratios of 38.00/45.00    Cannot exceed either of these max ratios!


How we Qualify: 30 year P & I@HELOC Start Rate (4.74% or 5.24%) plus

Payment Shock Factor of .0018 x the line amount ($180 on a $100K HELOC)

We look forward to working with you in 2014!!


Joanne Fabiano            or         Jhonda Stamper (my Inside Partner in Minnesota)

jfabiano@tcfbank.com            jstamper@tcfbank.com

(707) 666-1102                        (612) 661- 6734


For TCF forms, Submission Instructions or for help with a file in process, please contact:    Jhonda Stamper    jstamper@tcfbank.com  (612) 661-6734


Scenario assistance, Bret Knettel  bknettel@tcfbank.com  (612) 661-8917




Mon, 07/28/2014 - 10:11 | 5012403 Quinvarius
Quinvarius's picture

We have borrowed home sales well into the future using zirp.  How many homes can one family live in?

Mon, 07/28/2014 - 10:13 | 5012412 wonderatitall
wonderatitall's picture

regular amurikans otherwise know as slaves, cant and dont want to get a mortgage. the end

Mon, 07/28/2014 - 10:19 | 5012437 Cortez
Cortez's picture

Can't get a mortgage is the real issue.  There always have been those who don't want to get a mortgage.

Mon, 07/28/2014 - 10:22 | 5012449 Everybodys All ...
Everybodys All American's picture

The question to ask is how many families live in one home now.

Mon, 07/28/2014 - 10:12 | 5012410 foodstampbarry
foodstampbarry's picture

Print Mr. Yellin! Print!

Mon, 07/28/2014 - 10:15 | 5012418 SheepDog-One
SheepDog-One's picture

All time highs right back to all time misses....death spasms of the Ebola terminal patient.

Mon, 07/28/2014 - 10:18 | 5012433 Quinvarius
Quinvarius's picture

Don't buy until explosive diarrhea.

Mon, 07/28/2014 - 10:53 | 5012558 gatorengineer
gatorengineer's picture

This thing will come back from the dead a few times... if it opens down tomorrow, then buy with both hands and feet....

Mon, 07/28/2014 - 10:15 | 5012420 yogibear
yogibear's picture

Negative numbers turned positive eventually with the numerous adjustments.

Elections are coming up. Can't have bad numbers.

Mon, 07/28/2014 - 10:17 | 5012428 SheepDog-One
SheepDog-One's picture

The politicians are pretty much just hoping they're not killed by mobs.

Mon, 07/28/2014 - 10:17 | 5012429 Never One Roach
Never One Roach's picture

We need moar zero-down, no interest for 10 years, never-pay-back loans.

That's the New Stimulus Package these days.

Mon, 07/28/2014 - 10:17 | 5012430 Cortez
Cortez's picture

Hard to get qualified for a mortgage when there are less good jobs, people working for shittier pay and barely making enough to keep up with a car payment on a 72 or 84 month auto loan.

Mon, 07/28/2014 - 10:45 | 5012530 Postal
Postal's picture

Well, you know what would solve that: More immigrants!


Mon, 07/28/2014 - 10:18 | 5012432 foodstampbarry
foodstampbarry's picture

It's hurricane season in Florida, so this was expected.

Just ask LIESman.

Mon, 07/28/2014 - 10:43 | 5012522 Wahooo
Wahooo's picture

In the Era of Climate Change, the problem is always the weather.

Mon, 07/28/2014 - 10:54 | 5012565 1stepcloser
1stepcloser's picture

it was expected to be a slow storm season...Liesman needs another strawman

Mon, 07/28/2014 - 10:18 | 5012434 dontgoforit
dontgoforit's picture

Buy a house without a job.  Good trick if you can swing it.  Does $10/hr at McDonalds count?

Mon, 07/28/2014 - 10:19 | 5012438 novictim
novictim's picture

Home sales fell and prices went up?  No.

Home prices are not actually rising.  This is a statistical slight of hand being pushed by NAR.

What is happening is that the market is collapsing from the bottom up. Low and median priced homes are not selling as people think prices are too high or the buyers simply cannot qualify for a loan. 

So that leaves higher priced homes being disproportionately high as a percentage of home sales.  Voila!  "Rising" home prices! 

Your realtor didn't mention this to you, did they?  LOL

And what fuels this continued buying of overpriced homes?  Scared oligarchs from China trying to launder their money ("their" being a euphemism, of course) into something tangible like LA real estate.  They are fleeing China with wealth that in a short while will no longer exist.

Wealth inequality in China is driving these high end home sales.

Mon, 07/28/2014 - 12:19 | 5013087 CheapBastard
CheapBastard's picture

I don't really listen to the tiny realtor, former-first-grade-teacher, down the block. I just enjoy watching her tiny butt wiggle in that mini she wears to help sell houses...or when she climbs in to her Brand New BMW that most realtors seem to enjoy these days.

Mon, 07/28/2014 - 15:16 | 5013931 corporatewhore
corporatewhore's picture

Does she have bleach blonde hair and chiclet teeth? Is her soft porn picture featured at the grocery store with every shopping cart?  Does she wear her fuck me pump shoes? 


Mon, 07/28/2014 - 12:24 | 5013109 Vegas_Sirk
Vegas_Sirk's picture

I agree that maybe statistically this is the cause but it't not like that everywhere. For example here in Las Vegas, houses under $300K are not available. We have so much investor & foreign money being poured in to real estate here that the average Las Vegen can't buy a house. Anything under $300K is being bought cash and has multiple bids on it, as thats the magic number where in the even that you need to rent the property you can still make positive cash flow (if you decide to get a loan and get your money back out). This in its self is a real problem as its forcing familes to rent and not buy as they can't afford anything more with the low wages that area is seeing since the crash. 

Mon, 07/28/2014 - 15:40 | 5014084 novictim
novictim's picture

Yes, Lost Wages (Las Vegas) has a lot of Chinese investors. Chinese in China and Canada are hankering for some solid possessions before their phony money takes a dive.

But best to rent for now.  Those folks are apparently running afoul of the Chinese Authorities as well and this money laundering in real estate is supposed to be stopping.  Keep watching the trends.  These crashes in value occur very abruptly.

And with investor money so big in the market I expect the "abruptness" to be even more jarring.  Once the drop is apparent these guys will be the first to the exits.

Mon, 07/28/2014 - 18:56 | 5014996 dryam
dryam's picture

I live in the Charlotte area, and watch home prices very closely.  In various areas in the city and surrounding area houses between $130-$200k sell very well with many all cash offers within 2-3 days of hitting the market.  The market between $400k-$1mil+ is very stagnant.

Mon, 07/28/2014 - 12:25 | 5013110 Vegas_Sirk
Vegas_Sirk's picture

double post

Mon, 07/28/2014 - 10:21 | 5012442 drchris
drchris's picture

The median price increase is driven by a collapse in sales at the low end.

Mon, 07/28/2014 - 10:21 | 5012444 apberusdisvet
apberusdisvet's picture

As always, Propaganda cannot defeat the reality of Math.  Someone should do an analysis,  ex-cash and foreign buyers, of the real demand out there for the median home price in excesss of $230K with the declining median family income at less than $47k.

Mon, 07/28/2014 - 10:36 | 5012488 Skip
Skip's picture

IN all seriousness go long on housing, it is eventually going to skyrocket. Why? Well back in 1999 the US Census Bureau released a study that projected, based on then current immigration levels and non-traditional er American birthrates that the population at the end of the 21st century in the US would be ONE BILLION. I would think with the GOP crafting an amazing increase in the various alphabet work visas AND green cards for ALL foreign STEM students, and the Senate bill crafted by Rubio, McCain, Schumer, the Gang of Eight, increased LEGAL immigration by 3x. The fastest growing race, according to current Census reports, is ASIAN, in the US, so you look at these facts and the influx of New Americans at UNPRECEDENTED LEVELS and they all have to live SOMEWHERE so BULLISH on housing, SHORT on WHITEY, that is my financial advice at this time.


Resolve all over again that any amount of effort on "our" part at this point in history, "beats the alternatives". The only conceivable "alternative" is, of course to simply submit (it has been "planned that way") to a course of inaction that will culminate in your butchery and the butchery of your loved ones, at the hands of the bolshevik beast.

Richard Cotten, June 1966, Conservative Viewpoint

Mon, 07/28/2014 - 12:45 | 5013198 Omen IV
Omen IV's picture

so what - pray tell  - would a Billion People do for a job?

Mon, 07/28/2014 - 10:40 | 5012513 Seasmoke
Seasmoke's picture

All u see is more and more houses for sale here in NJ. In the $400,000-500,000 range and hardly a single one has moved since spring. 

Mon, 07/28/2014 - 10:45 | 5012527 The Most Intere...
The Most Interesting Frog in the World's picture

Same thing I am in the same corridor and sales have ground to a halt.  A bunch of new homes built that remain on the market - high 6 figures.  

Mon, 07/28/2014 - 10:57 | 5012578 corporatewhore
corporatewhore's picture

Same here in fly over country.

Are people actually getting smart and realizing how much income it takes to buy one of those at those prices?  And if you loose your job, which you will.....

Mon, 07/28/2014 - 11:05 | 5012626 Iriestx
Iriestx's picture

On the flip side, you could have bought some distressed properties around the greater Denver area before marijuana legalization for $100k.  Some very light fix-ups and you could have sold them for $500k+ after marijuana legalization.  They would have sold in minutes after putting them on the market, no less.


Location, location, location.  Nobody wants to live in NJ.

Mon, 07/28/2014 - 11:15 | 5012682 novictim
novictim's picture

"$400,000-500,000 range"

These homes are for upper middleclass Americans.  And those folks don't exist anymore.

Expect prices to remain flat and then precipitously fall.

Home prices follow a saw-toothed pattern of slow rise and then quick fall.  The rise occurs over several years and then the majority of price collapse occurs with in a 7-12 month period.

Mon, 07/28/2014 - 13:04 | 5013275 Dead Man Walking
Dead Man Walking's picture

I am in NJ also, and we have a street with 6 or 7 homes for sale in the 700k range, they just sit there. My opinion is if it's above the 430 or whatever "conforming" is these days, it's not going to sell.

Mon, 07/28/2014 - 15:31 | 5014012 novictim
novictim's picture

Ahhh...the "staring game". It is so pointless.  Seller keeps staring out the window at the backs of potential buyers who won't take the bait.  It can go on for several months before the reality of the current market sets in.

Behind those stares are a real estate broker and salesperson who keep whispering "real estate never drops in value!" into the ear of the seller.  But after a time, they capitulate too and settle for "Volume" rather than a higher commision.  So much ego involved. 

Sad and pathetic to start believing your own lies.

Wait them out, Dead.  The "deal of a lifetime" happens every 5 minutes.

Mon, 07/28/2014 - 10:43 | 5012520 The Most Intere...
The Most Interesting Frog in the World's picture

Pending and new home sales are down, and there is "a supply shortage".  Then build a bunch of brand new fucking spec homes dumbass!  Come on, start fucking building.  Hire a bunch of mother fuckers and go build some more fucking inventory.  


Fucking NAR moron.  You know why they are not building?  NO DEMAND ASSHOLE!

Mon, 07/28/2014 - 10:49 | 5012542 disabledvet
disabledvet's picture

No problem with demand for the debt tho.

Hm. Go figure.

Mon, 07/28/2014 - 11:27 | 5012718 novictim
novictim's picture

Oh, there is demand.  It is just not hungry for a millstone mortgage in the $400k+ range. 

And the builders are not building because they don't want to be caught in the pending collapse in house prices. 

Think about it.  Who has more at stake in the real-estate game  than a builder/developer?  Putting all the spin and NAR propaganda aside, the builders NOT building tells you everything you need to know.

They see the shadow inventory, the broke would-be buyers, the pending retirement avalanche of baby boomer homes/downsizing and the tenuous nature of the international investors and they are running is the opposite direction.

And they see the banks slow-walking the Notices of Default process and the huge number of delinquent mortgage payments.  Builders have too much on the line to ignore the facts.

Builders will take a fair gamble but this market is guaranteed  to collapse anytime now.

Mon, 07/28/2014 - 12:57 | 5013226 Omen IV
Omen IV's picture

This current market cannot be compared to any other period in real estate history - unprecedented foreclosure games by banks and judges with rulings that make no sense based on the facts presented coupled with cash purchases by other than final user of the property - all says there is another step to this windup process from 2009

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