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Where The Housing "Recovery" Is, In One Chart

Tyler Durden's picture




 

Janet, we have a problem. The Fed's main policy transmission channel, since stock ownership is not widespread enough to affect the real economy's expectations, is via home equity wealth creation and animal spirit exuberance-based borrowing and leverage. As the following chart shows, the much-touted "housing recovery" pillar of the economy - that is set to take off and lift growth to escape velocity - is only evident in one place...

 

 

As Janet herself opined recently, the poor better hurry and get rich so they can buy the $1 million homes and see price appreciation...

And move to The West!!

 

And, while everyone assumes it is the "rich" who are flipping homes and transacting like drunken sailors at a hooker convention, the fact is that the bulk of transactions in America are in the $100k to $500k range...

Which as is clear above, are losing 'value' this year.

*  *  *

Obama, Yellen - we are going to need a bigger stimulus plan - cash-for-clunker-houses?

 

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Mon, 09/22/2014 - 10:35 | 5242884 IronShield
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And you must speak Mandarin to apply!

Mon, 09/22/2014 - 10:48 | 5242922 Haus-Targaryen
Haus-Targaryen's picture

I am just waiting for a "Cash for Clunkers" real estate style to comes out.  

It'll be advertised like birth control is -- some cute blonde chick rollerblading with a poodle, and talking about how the government will give you a $150,000* refundable tax credit if you purchase a new "energy efficient" house, and tear down your old one.  

That'll definitely get the economy going.   

 

*Must spend at least $400,000 on the home to receive the full credit, for every $1000 cheaper than $400k the credit reduces itself by $250.  So if you spend $200k on a home, you could look at it as either buy house get it for half price, OR, in the alternative, buy one get one free, that you cannot sell for 30 years at a minimum.  However, if you are considered an underrepresented minority** then you receive the full tax credit, no reduction clause***.  

**Only Non-Cuban Hispanics, and Blacks need apply  

***If you are an underrepresented minority, after closing on your new Obamahome, you are eligible to cash-out refi and use the money for a vacation to Detroit or new Cadillac**** -- only. 

****Only the ELR qualifies 

Mon, 09/22/2014 - 10:59 | 5242959 Dr Strangemember
Dr Strangemember's picture

For the good of the country and economy, THIS NEEDS TO HAPPEN!  

Mon, 09/22/2014 - 11:04 | 5242974 Haus-Targaryen
Haus-Targaryen's picture

Can you imagine all the wealth that would be created for such an event.  To maximize its use, lets make the minimum age for home ownership 14 for Under Represented Minorites, and 18 for everyone else.  

If every URM child or about 5% of the American populion purchases a $100,000 Green Obamahome, then they can still receive the benefit of the remaining $150,000 refundable tax refund and then cash out refi the $100 used for the house.  

Then you have their parents, who have a job or something, and then they can afford a nicer $200,000 home, and still get $50k in the bank, then they could cash out refi and buy TWO ELRs.  

I mean we are talking about trillions upon trillions of new wealth creation here, plus we would solve homelessness, and with the ELR's NFC equipment, it could be tied directly into the EBT system, and people could just driver their ELR through the McDonalds drive through and get all their meals without ever having to leave the comfort of the car.  Solves hunger too.  

Maybe we need to import more poors to really increase the wealth creating effects this might have.  What about a ton of brand new teenages from south of the border?  

Mon, 09/22/2014 - 11:06 | 5242977 lordylord
lordylord's picture

What gets me is that people still vehemently argue on message boards that Obama has "saved" the economy.  They are in for a surprise when the curtain comes down. 

Mon, 09/22/2014 - 13:40 | 5243714 Ying-Yang
Ying-Yang's picture

The poor can apply for work at Alibaba... /s

Mon, 09/22/2014 - 11:59 | 5243222 Hobbleknee
Hobbleknee's picture

I thought they already solved homelessness by making it illegal to be homeless.

Mon, 09/22/2014 - 12:14 | 5243297 Cortez
Cortez's picture

I'm sure outlawing homelessness will work exactly as well as outlawing drugs in America.

Tue, 09/23/2014 - 13:50 | 5248236 Hobbleknee
Hobbleknee's picture

So invade Syria?

Mon, 09/22/2014 - 11:54 | 5243191 BeanusCountus
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Great program!!!  Barney?  Is that you?

Mon, 09/22/2014 - 13:49 | 5243762 EBT excepted
EBT excepted's picture

hey...dis' border on raciss...if'n I get a BOGO 'bama-house, I got's lots 'a EBT to put in it...plus, I 'ca have 'ma peeples ova', fo' a raise-da-rent...sides, wut choo makin' fun my El Dorado fo'...dat's a cold El Dorado...got some prollem wid De-troit?  All ma' peeples lives ova'-dere...

 

 

arm yourself, the time may come when holding your hand over your anus is not sufficient...

Mon, 09/22/2014 - 10:36 | 5242885 X-defiler
X-defiler's picture

We are is a depression. We are on barrowed times.

Mon, 09/22/2014 - 11:10 | 5242984 lordylord
lordylord's picture

Don't tell that to people who voted for Obama.  They think the economy is saved...until their EBT runs out. 

Mon, 09/22/2014 - 10:37 | 5242886 q99x2
q99x2's picture

I'd wait to buy.

Mon, 09/22/2014 - 10:37 | 5242887 papaswamp
papaswamp's picture

Rates stay low fo'evea bitchez!

Mon, 09/22/2014 - 10:37 | 5242888 l8apex
l8apex's picture

'MURICA !!!1!!!!111!!

Mon, 09/22/2014 - 10:37 | 5242889 Dazman
Dazman's picture

Bullish

Mon, 09/22/2014 - 10:38 | 5242890 Bumbu Sauce
Bumbu Sauce's picture

Thanks to the flipper fad starter homes are near impossible to find.  Everyone seems to think their $20,000 flip on a $30,000 house is worth $140.000.  I just don't get it.  If interest rates were higher and there were logical loan standards, this shit wouldn't be happening.  Property rates will be affordable in Ferguson.

Mon, 09/22/2014 - 10:44 | 5242916 geekz_rule
geekz_rule's picture

yep.. 20+ years of late night info mercials, pimpin thier books on how to flip...celebrated as murican #1 make money easy man... has also contributed to our fucked status. much like wal mart selling cheap chinese gizmos.. was great for a few years, but now we have zero manufacturing, and we are fucked yet again..just another piece of the big puzzle!

Mon, 09/22/2014 - 11:13 | 5242996 dizzyfingers
dizzyfingers's picture

"now we have zero manufacturing, and we are fucked yet again..just another piece of the big puzzle!"

 

Another piece of that puzzle is 1960s and 1970s when green boomers drove manufacturing offshore via government lawsuits against US manufacturers of major goods and jobs that supported families and college educations for kids. Effed themselves and their kids good. Must have clean air! Welcome to Utopia.

Mon, 09/22/2014 - 11:59 | 5243223 GeezerGeek
GeezerGeek's picture

Don't knock clean air. It's important if you're living under a bridge or in a cardboard box, neither of which are equipped with HEPA filters.

Mon, 09/22/2014 - 10:58 | 5242954 Dr Strangemember
Dr Strangemember's picture

Give it time... the reality is incomes can't compete with those higher prices and the "true" value of those homes is closer to the prices the non-improved / non-flipped home in the same hood.  Private Equity is no longer buying because prices are too high... won't take long for invetories to rise and prices to drop like lead.  

Mon, 09/22/2014 - 16:01 | 5244314 AGuy
AGuy's picture

"Private Equity is no longer buying because prices are too high... won't take long for invetories to rise and prices to drop like lead."

The Fed will never let home prices collapse. As soon as they start dropping, the Fed will start buying mortgages and underwater assets again. hedge Funds will flip their assets to the Fed with over market assemtments and make billions from Fed printing. The Fed won't care if the assets rot, all that matters is they keep the bubble inflated. The Fed has been keeping the bubble inflated for about 30 years now, everytime it begins to pop, they patch and start ejecting liquidity.

The only think the Fed can't print is more Oil, we are very close to global peak production. Once we are on the other side the global economy will begin to crumble. At worst, gov't will go to war to secure the remaining oil left, and probably triggler WW3.

 

 

Mon, 09/22/2014 - 10:39 | 5242894 Cangaroo.TNT
Cangaroo.TNT's picture

Is sales distribution by number of units or total dollars transacted?  Serious question.

Mon, 09/22/2014 - 10:38 | 5242895 Al Huxley
Al Huxley's picture

At least the important people are making money.  Janet, any hints on how we can get +$1million homes, so we can also participate?  Your suggestion to 'get assets' was a little vague.

Mon, 09/22/2014 - 10:42 | 5242908 Spastica Rex
Spastica Rex's picture

Start small: buy an Escalade.

Mon, 09/22/2014 - 10:45 | 5242919 Dr. Engali
Dr. Engali's picture

Too bad they stopped making Hummers. I'd like to buy one for a mobile home.

Mon, 09/22/2014 - 13:30 | 5243671 PhysicalRealm
Mon, 09/22/2014 - 10:55 | 5242943 Took Red Pill
Took Red Pill's picture

buy a scanner/printer and print your own money

Mon, 09/22/2014 - 10:51 | 5242932 NotApplicable
NotApplicable's picture

Just let her print a few more years, and the whole country will be like Silly Con Valley, with dumps priced in the stratosphere.

My biggest fear is accompanying tax increases. Since I'm not "in the club," the assessor might take a liking to my place. Which is why I have an old car rotting in the driveway, as well as a shed/barn that needs repaired and moved closer to the garden.

Mon, 09/22/2014 - 10:40 | 5242897 jmcadg
jmcadg's picture

This may be true Tylers, but what percentage of the +$1m houses does the 2.3% of overall equate to - you'll probably find the rich are flipper like fuckers.

Mon, 09/22/2014 - 11:05 | 5242973 Winston Churchill
Winston Churchill's picture

Not flipping, but they are selling.Cashing out I'm thinking.

 Two of my oligarchs clients have just sold their mansions up North(Ma and NJ).

Two of the smarter ones I might add.

Mon, 09/22/2014 - 10:39 | 5242900 lanchende
lanchende's picture

Cash - for Bunkers?

Dwellins from Yellen?

Mon, 09/22/2014 - 11:15 | 5243011 Cortez
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Yellen - FHRITP?

Mon, 09/22/2014 - 10:41 | 5242902 geekz_rule
geekz_rule's picture

I love sharing this stuff, ya know, facts, on FB etc... really quickly provides the evidence of who the biggest suckers are in my audience, the ones that want to argue with .. well.. evidence. usually real estate selles, of course.

 

Mon, 09/22/2014 - 10:46 | 5242903 Dr. Engali
Dr. Engali's picture

Nobody has any fucking money, but they do have the latest iCrap with zero money down and financed over the next 18 month, which is just long enough for them to finance the latest iCrap which will have big improvements like the ability to make phone calls.

Mon, 09/22/2014 - 10:47 | 5242927 drchris
drchris's picture

And they can afford to spend days in line to get it. 

Mon, 09/22/2014 - 10:53 | 5242938 tawdzilla
tawdzilla's picture

Does Apple accept EBT cards?  If so, the peeps could upgrade from the Obamaphone to the iCrap 

Mon, 09/22/2014 - 13:56 | 5243797 EBT excepted
EBT excepted's picture

yeah, dey except da EBT in da back, wid dee 'bamaphones...

Mon, 09/22/2014 - 10:57 | 5242955 nobodysfool
nobodysfool's picture

Agree....iphone6 buyers are the quintessential definition of sheeple!  No limit to how gullible (stupid) people can be. iphone technology close to 2yrs behind Android in most cases...

http://www.businessinsider.com/graphic-iphone-6-v-nexus-4-2014-9

 

 

 

Mon, 09/22/2014 - 10:41 | 5242904 youngman
youngman's picture

affordable is not where you want to live...trust me

Mon, 09/22/2014 - 10:44 | 5242913 giggler321
giggler321's picture

You're right, I'm priced out now those 1$ homes in Detroit have trippled in value.

Mon, 09/22/2014 - 10:41 | 5242907 disabledvet
disabledvet's picture

Saw it first hand here in Upstate New York. "Houses for a dollar." Of course the assessed value wasn't a dollar...but that was the value of the house once the Federal Government and Senator Bradley from New Jersey wiped Rome, NY off the face of the earth.

Would appear the war effort didn't work either. Got a lot of nice motels going up everywhere though. Do those count as "housing starts"?

Mon, 09/22/2014 - 10:41 | 5242909 youngman
youngman's picture

Commercial real estate seems to still be going strong...dont know why..but it is..

Mon, 09/22/2014 - 10:49 | 5242930 tawdzilla
tawdzilla's picture

because of ZIRP...yield reach

Mon, 09/22/2014 - 10:44 | 5242914 RaceToTheBottom
RaceToTheBottom's picture

Obamahouse?

Mon, 09/22/2014 - 14:08 | 5243854 EBT excepted
EBT excepted's picture

dats da good idea, 'bamahouse plus da 'bamaphone plus da EBT...he gon' pay my house payment...

Mon, 09/22/2014 - 10:59 | 5242918 Cortez
Cortez's picture

The low end out west was down -32% yoy.  So it only pays to be a millionaire out that way.  Otherwise your home is experiencing an equity crush.

Mon, 09/22/2014 - 10:46 | 5242920 NoWayJose
NoWayJose's picture

The owners of these homes are the ONLY ones included in all those 'consumer sentiment' surveys!

Mon, 09/22/2014 - 10:47 | 5242924 toady
toady's picture

The title said there would be only one chart.

Mon, 09/22/2014 - 10:48 | 5242925 StupidEarthlings
StupidEarthlings's picture

Ho li phuk.. "cash for clunker houses".. why didnt I think of that.

Well Just tear down your ol pos shack..and build a newer bigger better fancier one... with zero interes (for the first ahem couple years..ahem).

 

Friggin jumpstart this economy like a mutha.

:/

Mon, 09/22/2014 - 14:12 | 5243869 EBT excepted
EBT excepted's picture

yeah, dat da bee mo'fo'...da wef affect, makin' me want a bee mac...dem mu'fuggas fill you up...ma peeples works down dere...

Mon, 09/22/2014 - 10:49 | 5242931 NOZZLE
NOZZLE's picture

Yeah, I know.  

Mon, 09/22/2014 - 10:59 | 5242961 dizzyfingers
dizzyfingers's picture

Town newspaper said the other day (quoting, I guess, the folks at our always-popular county assessor's office) that real home "values" may be down (they are WAY down, double digits) but taxes will be up. Road construction in our area is booming. Who's going to use these new 6-lane roads? Same in the state just north of us.

Mon, 09/22/2014 - 11:13 | 5243004 Dr Strangemember
Dr Strangemember's picture

Dude, you're really ax'in who???  Well, it's the illegal Mexicans, that's who.  Now open your wallet and stop being so "ray-sis"!!!!

Mon, 09/22/2014 - 11:43 | 5243139 Ckierst1
Ckierst1's picture

No, man, it's for the MRAPs.  Do they get a freebie at the new toll booths on the Interstates?

Mon, 09/22/2014 - 11:19 | 5243019 toady
toady's picture

And so it begins...

Values down, taxes up, make-work "jobs" for the unemployed.

In a quickly increasing spiral...

Mon, 09/22/2014 - 11:27 | 5243061 CrazyCatLady
CrazyCatLady's picture

I have also seen a curious increase in road construction/bridge repair where i live, which is deep south. 

Mon, 09/22/2014 - 11:19 | 5243017 Johnny_is_alrea...
Johnny_is_already_taken's picture

Dont worrie when the next crisis hits the helicopter will take off again

 

chong chong chong chong

Mon, 09/22/2014 - 11:32 | 5243077 starman
starman's picture

Long on RV sales! Mobile banking mobile communication in a mobile society! 

Mon, 09/22/2014 - 12:02 | 5243231 Ckierst1
Ckierst1's picture

For the 95 (or is it 99?) percenters it seems nuts to own a house (that you don't really own anyway), when you have little confidence that your job(s) will be there to float the mortgage or that you'll be able to easily sell it to move to the new job(s) (jobsite?-yeah, they do that shit too!).  When everything is manipulated you need a script and a witch doctor to get the timing right.

Mon, 09/22/2014 - 11:30 | 5243080 kchrisc
kchrisc's picture

That looks healthy and sustainable.

An American, not US subject.

Mon, 09/22/2014 - 11:34 | 5243100 orangegeek
orangegeek's picture

philly housing index bounced late last week to 203

 

http://bullandbearmash.com/chart/philly-housing-daily-index-bounce-wave-...

 

but once again, it doesn't hold and we are at 195 - incidently, the all time high was 290 in 2005 - here we are 9 years later and we've merely retraced

 

what does this indicate?  it indicates that there has never been a housing recovery and that we are likely to get below March 2009 lows over the next two years

Mon, 09/22/2014 - 11:53 | 5243188 SethDealer
SethDealer's picture

these fags on TV make flippin look cool. million dollar listing!

Mon, 09/22/2014 - 12:25 | 5243357 PoliticalRefuge...
PoliticalRefugeefromCalif.'s picture

Idiot 'flippinginvestor'/school bus driver across the street has been trying to unload one of his 'investments' for about six months now, haha.. I tried to tell him about chasing cars.

..also the braindead Realtor next door to him seems to have a lot of free time lately..

yo- dem chickens are starting to come home.

Mon, 09/22/2014 - 12:58 | 5243515 Bunga Bunga
Bunga Bunga's picture

I would never have guessed it: the American Dream means socialism.

Mon, 09/22/2014 - 13:49 | 5243761 hooligan2009
hooligan2009's picture

cash for clunkers...hmmm..dont tell krugman.. he will say build 5 million x$1 million houses to fit the upsurge in income brackets just around the corner.

i guess he would put up all the displaced millions in hotels and have them all full (+ve for GDP) on a drip fed basis so that GDP would have a nice upward trajectory as well

Mon, 09/22/2014 - 21:27 | 5244723 honestann
honestann's picture

+10

A new meaning for "hotel California".

Of course, in actual fact, what the economy really needs is... an absolute, complete, utter wipeout of the entire real-estate market, where prices fall 80% or 90%.  Then young folks could then actually afford to buy, and have some money left over after paying their mortgage payments... if they had payments at all.

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