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Existing Home Sales Collapse Most Since July 2010, Downtick In Stock Market Blamed
Having exuberantly reached its highest level since September 2013 last month (despite the total collapse in mortgage applications), it appears the ugly reality of the housing market has peeked its head out once again. As prices rose, existing home sales plunged 6.1% - the most since July 2010 (against an expected 1.1% drop) to 4.93mm SAAR (the lowest in 6 months).

So what was it this time: the polar vortex, the crude collapse, the crude vortex? Neither: According to the NAR's endlessly amusing Larry Yun, this time it was the stock market:
“The stock market swings in October may have impacted some consumers’ psyche and therefore led to fewer November closings. Furthermore, rising home values are causing more investors to retreat from the market.”
Supposedly he is referring to the tumble, not the resulting Bullard "QE4" mega-explosion in stocks that pushed everyhting to new all time highs.
In other words, according to the NAR, even the tiniest downtick in stocks, and the housing market gets it.
Sure enough, it is time to boost confidence in a rigged, manipulated ponzi scheme:
- DROP IN NOVEMBER COULD BE ONE-MONTH ‘ABERRATION,” YUN SAYS
Unless, of course, stocks drop again, in which case all bets are off.
Meanwhile, it appears investors have left the building...
Every part of America saw a collapse:
November existing-home sales in the Northeast declined 4.2 percent to an annual rate of 680,000, but are still 4.6 percent above a year ago. The median price in the Northeast was $246,100, which is 1.3 percent above a year ago.
In the Midwest, existing-home sales fell 8.9 percent to an annual level of 1.13 million in November, and are now 1.7 percent below November 2013. The median price in the Midwest was $160,500, up 7.0 percent from a year ago.
Existing-home sales in the South decreased 3.2 percent to an annual rate of 2.09 million in November, but remain 5.0 percent above November 2013. The median price in the South was $176,500, up 5.2 percent from a year ago.
Existing-home sales in the West dropped 9.6 percent to an annual rate of 1.03 million in November, and remain 1.0 percent below a year ago. The median price in the West was $292,700, which is 3.5 percent above November 2013.
Some more amusing details from the report:
The median existing-home price2 for all housing types in November was $205,300, which is 5.0 percent above November 2013. This marks the 33rd consecutive month of year-over-year price gains.
Total housing inventory3 at the end of November fell 6.7 percent to 2.09 million existing homes available for sale, which represents a 5.1-month supply at the current sales pace – unchanged from last month. Despite the tightening in supply, unsold inventory remains 2.0 percent higher than a year ago, when there were 2.05 million existing homes available for sale.
“Lagging homebuilding activity continues to hamstring overall housing supply and is still too low in relation to this year’s promising job growth,” says Yun. “Much faster price and rent appreciation – easily exceeding wage growth – will occur next year unless new construction picks up measurably.”
All-cash sales were 25 percent of transactions in November, down from 27 percent in October and 32 percent in November of last year.
Individual investors, who account for many cash sales, purchased 15 percent of homes in November, unchanged from last month and below November 2013 (19 percent). Sixty-one percent of investors paid cash in November.
The percent share of first-time buyers in November climbed to 31 percent, up from October (29 percent) and is the highest share since October 2012 (also 31 percent). First-time buyers have represented an average of 29 percent of buyers through November of this year.
Distressed sales – foreclosures and short sales – were unchanged in November from October (9 percent) and remained in the single digits for the fourth month this year; they were 14 percent a year ago. Six percent of November sales were foreclosures and 3 percent were short sales. Foreclosures sold for an average discount of 17 percent below market value in November (15 percent in October), while short sales were discounted 13 percent (10 percent in October).
Properties typically stayed on the market in November longer (65 days) than last month (63 days) and a year ago (56 days). Short sales were on the market the longest at a median of 116 days in November, while foreclosures sold in 65 days and non-distressed homes took 63 days. Thirty-two percent of homes sold in November were on the market for less than a month.
But don't worry about all that: the NAR couldn't be happier that just like in the last housing bubble, so too now Fannie and Freddie's new 3% down payment initiative, means the bubble is about to get bigger than ever:
NAR President Chris Polychron, executive broker with 1st Choice Realty in Hot Springs, Ark., says Fannie Mae and Freddie Mac’s new low downpayment program should improve access to credit for responsible buyers. “NAR applauds Fannie and Freddie’s commitment to homeownership by serving creditworthy borrowers who lack the resources for substantial downpayments plus closing costs with its new downpayment program,” he said. “The new program mitigates risk with strong underwriting and ensures that responsible buyers have access to safe and affordable mortgage credit. Furthermore, NAR believes lenders must do their part to ensure loans are prudently underwritten and are made available to qualified borrowers.”
And since the taxpayers will be left to bail out the excesses of this latest incipient housing bubble, what's not to like?
But the punchline: the median price of existing homes dropped to $205,300...
... because, well, there is a "lack of supply."
Nov existing home sales fell 6.1% to 4.93M-the lowest level since last May (4.91M). Lack of supply continues to weigh on the #housing market
— Joseph A. LaVorgna (@Lavorgnanomics) December 22, 2014
yep - that must be it...
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I pooped today.
i have not yet pooped today.
Woke up with a stomach ache this morning (true story) and it all came racing out. Now I know why.
along with home sales. mine was plunged
Thanks to ZH I got the poop on real estate sales. In the dumps.
Never underestimate the importance of a good bowel movement. You young bucks go ahead and laugh all you want. It could be one of the top 10 best pieces of advice I ever got.
Yep! Dont trust a fart, dont waste a boner, and no matter what, dont buy a house!
Nothing better than a good shit first thing in the morning.....
Imagine one the size of a burrito. (Not mine.) Took two days to flush down.
In California the reason is the pricing, sellers are asking 20% more than 2 years ago. I figure they need the money.
High Pitched Whine: "But we always made money in real estate, Whaaaaa"
Seems that private equity and hedge funds are done buying up property and mortgages? What will support pricing (of any sort) now?????
Live with it.
Pretty much the same reason everywhere the market is tanking. Even sub-subprime ain't gonna save them.
I haven't pooped yet either, but since Monday morning is my Friday night these days, I am drinking already.
"Everyone Poops" is a great book.
There's Never Been A Better Time To Go Poop ™ - NAR
We pooped on some folks.
Well, this has certainly turned into a shitty thread!
I may, or may not have pooped today.
#hedging
The political promise poop?
So it wasn't crudenado?
I've got some property in Ferguson, MO I'd like to sell. Shouldn't be a problem. I hear real estate is ON FIRE there.
OHHHH! BAMM!
Thank you, thank you. I'll be here all week.
Brother in law sells properties in Branson, MO - says that market is just on fire too. Electrical fires are the most popular, but a kitchen fire is also a good way to get out from under property there. Try the veal, tip your waiters.
Said he used to do 5, 6 deals a day, may see that now in a good week. Vaguely remembers what a good week was.
I'll be taking my 7-year-old to Branson next week. We were there last summer; and I seem to remember the locals talking about how their economy was not doing so well. Several hotels have closed down in the past 2 years. Hell, Silver Dollar City (not to mention all the shows in town) charges such high admission fees that I can see how the tourism market will tank once disposable income dries up. Which, for a lot of us in the heartland, it has. Pity, I kinda like Branson.
RE around Pahoa, HI. is on fire too; especially commercial property.
http://www.techtimes.com/articles/22639/20141222/lava-flow-kilauea-volca...
Oh the irony.
all news is good news. i'm done fighiting it. went long today...first time in 3 years.
went long today...first time in 3 years.
damn your ass must be good and sore by now
Must be time to go short.
when they guys that write the propaganda start effing themselves we will be getting close. So i guess everyone is too busy shopping at stores in this recovery to buy a house.
We need a knive catcher. Is there a knive catcher in the room?
Got to love that 5% rise in prices vs the paltry rise in income ( due to dropping gas).
What a load of horseshit. Do you think Blake would put up with that whiney excuse-making in 'Glengarry Glen Ross'?
http://vimeo.com/64121060
"Put that coffee down. What? Put that coffee down. Coffee is for closers only."
What's my name? Fuck you! That's my name!
"You know why, mister? Because you drove here tonight in Hyundai. I drove here tonight in an $80,000 BMW. THAT'S my name."
Fun-Yun is a regular encyclopedia of real estate knownledge. He comes right out and publishes his deep thoughts!
Looks like we will need to import some additional buyers from China!
Come on in the waters fine! Never been a better time to mire yourself deeply in debt.
0% down
The wifes friends husband (realtor) been marketing to Chinese for three years now. Americans don't have much money anymore to buy a house.
*credit
Zero, zilch, nada is selling in my area and most of the used houses pulled their signs last week. I went to a few ‘open houses’ of those used places and was met by eager but very depressed realtors who offered me cookies, soda, and expensive bottled water with the French name but each in turn became pretty disgruntled when they found out I was only browsing for fun.
2015 will see the Great Housing Correction I’m afraid with a wicked reversion to the mean, esp as we head into the more severe depression of the private sector with total collapse of the O&G sector.
philly housing index shows "housing boom" is pending
http://bullandbearmash.com/chart/philly-housing-monthly-finds-year-high-...
we all know this is bullshit and yet another attempt by yellen /central banks to keep markets propped up to convince the masses that everything is fine
NAR's larry yun stupidhead comment - blame the markets - numbskull brilliance
housing needs to come way down, prices are a joke and unsustainable. Hope the fed lets them tumble next time rather than propping up this bullshit
QE4!! QE4!! QE4!!
Lack of supply. Oh yeah. So many people I know are living with their parents because they can't find a home. Not because they can't afford one. No, couldn't be that.
Hard to qualify for a mortgage at full doc. / 4 part time jobs.........
historically, a ratio of house cost to income of 2.6 was considered affordable.
Today, the average price is $205,000.... so, the average family income should be about 78,900...
but, average family income is only around $53,000... or, a Price to earnings ratio of nearly 3.9.
So, either prices fall to about 137,800, or incomes surge to 78,900.
I'm guessing house prices continue to fall, especially when all these baby boomers start reaching the age when they need to go into a nursing home and have to liquidate their multiple homes in order to pay for their care.
WINNING!
Exactly. All those millenials are living in apartments or their parents' basements while practically ever boomer I know lives in a gigantic house. It will be interesting when the boomers start to pass. Is their liquidation going to be peaceful and organized?
There is a GLUT of homes, and a large portion of the population will be passing away, and many of them have more than one home. So, you can expect more homes to come onto the market.
Not only are homes overpriced compared to income, but there are FAR too many to begin with. Overpriced, and an Overabundance? Seems to me the FED's attempt to support the current house prices in order to save their banking / mortgage buddies is not going to work.
Did they mention that 49% of working Americans are living paycheck-to-paycheck according to the latest Allianz data.
I expect the Great Hosuing Collpase any week now. Those $55 psf houses they are selling for $165 psf will painfully correct to come in line with private sector wages which have risen zero the last decade [or two].
real wages have fallen since the late 70's, early 80's. That was the peak.
"Lack of supply" is just doublespeak for artificially suppressed(mostly lower end) inventory by the banks driving up prices that most are unwilling or unable to pay.
I'm sorry, but this is complete doublespeak - "creditworthy borrowers who lack the resources"
A lot of people would call them non credit worthy, if you define such things by one's ability to pay for a loan. You'd want them to have the resources, but maybe I'm looking at this all skewed.
I basically said the same thing below. You beat me to it.
I believe Texas real estate will drive future numbers. So much of the past few years were driven by the "energy renaissance Imagine a Texas developer just about to make a bid on a hundred acre piece of raw land. With a $55 drop in the price of oil, do you think he is going to wait a little to see what is coming down the road, drop his bid 50% or what?
"creditworthy borrowers who lack the resources"
Under normal circumstances wouldn't that statement be kind of a wash?
And what kind of dumbass buys a house who doesn't have the resources?
If they lack the resources they are NOT credit worthy.
Fucking polar vortex.
Excluding the baked GDP numbers and the 3 for 1 part time from full time job Non Farm Payroll numbers,
Every other indicator says we are in a recession.
Has anyone tried to find a good used cardboard box behind grocery store lately? Unless you're there mid-morning when they bring the first ones out, you'll be hard pressed to get one period. Demand is through the roof. The shiney boxes with the coating on the outside are really getting scarce.....best for rainy weather, high winds and snow and are less likely to catch fire from that single candle heating system.
Go Long Cardboard Boxes!
Try gas stations. Worked well for me.
Under the bridge is getting packed....cannot find a good heat grate either anymore. Looks like it's the Manhole Hotel for me......
Maybe all the available housing is in the mark to fantasy pipeline of the debt collecting servicer fraudclosed houses for FANNIE Mae and Freddie Mac. .....but if they ever released them.....CATCH-22
3% down 30 year mortgages 0 down 0 interst 84 month auto loans
23% Citi card woth 30k credit limit, life is good for the average American!!!
"Hope and change" and "Recovery"
Thank you great muslim fuhrer!
So what you're saying is they really haven't gone up since 2012. Gotcha.
There's a 90% chance of QE 4 in late 2015, maybe even sooner.
James Rickards says the Fed starts a new QE program every 15 months from the end of the last one.
It's QE and zero interest rates forever.
Don't worry, the mortgage securitizing agencies are allowing smaller down payments and weaker credit scores to obtain sellable mortgages, in April of 2015. We never learn and I hope that those who buy a home because it's price will inflate, will find out homes are becoming more like cars and not an investment, but a necessary asset If you buy in SF or WDC where there is limmited land available near working sites you are going to pay a lot more right now but later when the FED boom is over, then get ready to cry as the inflation will be over. Google is already moving to more affordable places to do their R&D and the electric car (Tesla) maker is moving battery mfg to Nevada where property is cheap, as they learn they have to compete with the rest of the world. Only those of the financial or pill industries can afford to be in the SF area, since they don't manufactuer there but need the research available at nearby Stanford and Berkley, which has large government support.
I read somewhere, can't remember where though, that 70% of all new housing starts came from the state of texas and that was before the oil crash. Now, can anyone tell me the homebuilder who mainly builds in texas?
"NAR President Chris Polychron"...
'Polychron'...?
Thaose charts show 2013 being a complete disaster. Didn't Obama fix the economy?
Real Estate prices have only fallen about half way to the level at which they will eventually settle. The bear market rally of the last three years appears over. Prices should continue their decline into the housing abyss very shortly...
http://www.globaldeflationnews.com/inflation-vs-deflation-part-3how-the-...
I looked at that chart. It seems to greatly overstate the amount prices have fallen. People around here still want mid 200 to 300's for a "normal" home, and over 400 for a new home. We're talking 200 psf
I picked up one of those real estate booklets at the sandwich shop. The prices are still in la-la land. They want well over 200k for a ranch on a quarter of an acre.
Hey mr. realtor. Suck my dick. I ain't buying your overpriced fixer upper. Take 40% off and I may think about it. Until then, reap what you have sown, you greedy fuckers.
Dick-fuck Larry Yun... How does that incompetent ass-bite still have a job??
But then again every week since November 2008, I have been asking the same question about "some folks" aka Obama Bin Lyin'...
Downtick in the market? You've gotta be kidding me. It's not the weather again? For sure, greenhouse gasses have shot up this year, especially whenever the BLS opens their mouth. As Dirty Harry said, their mouthwash just ain't cutting it!