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What Housing Recovery? Existing Home Sales Miss By Most In 2 Years
While it seems like everyone 'wants' the housing recovery to be real and organic (and not simply a reflection of limited supply and P.E. investor interest in scraping up the lowest fruit - they have to earn their commish after all), even the NAR couldn't put lipstick on this morning's pig of an existing home sales number. The biggest drop MoM in 16 months and the largest miss to expectations in 24 months is hardly the stuff of a solid foundation for the renaissance of the American Dream. CNBC's Diana Olick speaks the truth on the distressed supply drying up (despite Liesman's efforts to ignore it).
CNBC's Diana Olick explains the reality...
Once again it seems CNBC's embed team just can't get it together so here is the direct link.
Charts: Bloomberg
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Close though.....right?
Horseshoes, hand grenades......and housing.
Many people still couldn't sell their existing home even if they wanted to, they are too far underwater. Prices would need to rise more before it even becomes a possibility.
With such good news I see 13000 just over the horizon.
I'll get the bowl. You get the shotglass.
If we had a drinking game for every time CNBS said "housing bottom" over the last 3 years, this country would have run out of booze long ago.
and then Steve Liesman said, "Let me jump in with some economics here, Diana"
Such a fucking piece of shit this LIESman, such a doucher
And then they have to figure out who the real owner is.
Wait until all those title defects start popping up and the former seller turns up wanting his house back since he "never sold it to you" from what the defective papers show. You are looking at a hefty legal bill...it's expensive.
And those who can afford to put 20% down know better to wait.
wait until what?? both deflation and hyperinflation imply real estate massacres... and after "the great reset", does anyone think that property rights will be the basis of the post-reset "new normal"??
it will be 'agenda 21' meets 'venus project'...
That's exactly right. The uknown is also a good reason to wait as well as lower prices and better understanding of what is happening to America.
If Obame wins and you buy a new house, you have to take in LaTeshia and Keneshia and their six welfare babies because it's not "fair" you have a new house and they don't.
Yeah, that and the ratings pretty much sums up where so much of this board is coming from.....KKK Redux.
I'm waiting. But I'm worried the sharp down in prices might be more than offset by the sharp up in interest rates. Both deflation and inflation are coming but which wins, what the timing is a lot of unknown. Real estate outside of zombieland is a good investment IMHO.
... that means buyers/investors will pay cash... what else will they have to invest in? Anyway, the new CFPB rules in play will effectively kill all mortgage lending, at least to low/med inc borrowers.
Well they need to tighten lending standards, because currently a lot of people are still buying homes they can't afford. The lenders will give smaller loans and the sellers will have to adjust their prices accordingly. Until the home prices fall in line with incomes the Bernanke will have to keep fighting fundamentals with his zirp and twist. One should pay a MAXIMUM of 3 times one's income for a home. Ignoring this rule of affordability led to the housing debacle.
20%? For what? I'd not risk one thin dime of my own in a rigged game like this.
That's what Title Insurance is for.
Title insurance? Good luck with that.
Like the FDIC, when the wheels finally come off, there won't be anyone to answer the phones at the title insurance co. The windows will be boarded up.
Title insurers are simply skimming their vig when times are relatively normal. Sure, once in a while, they pay on a policy. When things really go bad and it's determined that 50%+ of all titles are clouded, they're closing their doors and walking away. Same goes for ALTA (American Land Title Association,) the umbrella organization or trade association. When TSHTF, the whole mess will be nationalized. I'm sure that will sort things out quickly! sarc/.
"July 18--The Oregon Court of Appeals struck a blow to the mortgage industry in Oregon today, ruling that its controversial document-registry system could not be used to skirt state recording law in out-of-court foreclosures.
In a decision with implications beyond the Mortgage Electronic Registration Systems Inc., the state's second-highest court also held today that a lender must ensure a complete ownership history of the mortgage is filed in county records before it can foreclose outside a courtroom."
MERS cy me!
++1,000
Fucking unbeliveable Liesman ! What a douche wag water carrying punk.
You could see Olick wanted to beat the fucking crap out of Liesman, that condescending prick
Median price is up +7.9% YoY
Sssshhhhh, there is no inflation, anywhere, Krugman and the Bernanke say so.
Just don't go to Walmart.
Can I just look it up on-line. I always feel sullied when I go there.
I don't believe any numbers any more.
Zackly.. Was looking through local houses for sale.. Unreal deals out there.. Down about 30-50% from 2006.. Gonna be even better next year.. Housing prices are not up.. Don't believe it.. Had a friend tell me a few years ago his hous appraised for 265k.. I told him BS.. He looked into selling it last year.. Agent said if he didn't list at 175, he would even get a single bite.. Lots of lies being told out there.. The market is a disaster for sellers..
You must not be in the Chicago area. The houses in a decent area that are big enough to warrant a move from a two bedroom apartment are still WAY out of line with incomes. Sifting through the new mortgages on the homes that do sell, it is apparent that the lending standards still aren't that high. There are some pretty big mortgages on those overpriced crap boxes.
So what? Median has nothing to do with appreciation or inflation... it is just a statistic of the homes sold- meaning higher end homes are being sold and lower end are languishing.... and the number of those homes are at 30 year lows, even with the increase in population over the last 30 years- DISMAL is the only word that comes to mind.
The banks put some high end REOs for sale at a bargain price ... and voila!
If there are fewer existing homes being sold overall, because fewer at the foreclosure/short sale end (cheaper priced homes), that shifts the median price upwards, even if the average home is static in price.
Also, the median would rise if the same number of homes are for sale, but a larger percentage of them are higher-priced homes. This isn't necessarily good news, since it may indicate higher-income households are entering the default/foreclosure/short sale pool. It just means the pain is spreading to upper middle class families.
Or, everything is peachy and its totally obvious that buying a home today and flipping it in a year or two will make you filthy rich.
Markets broken.....period
An essential component in believing the American Dream is...you must be asleep.
But this morning's front page lead story banner in my paper says "HOME SALES GO THROUGH THE ROOF"
Perhaps they forgot to mention the house was upside down?
upside down and under water
Four houses went up for sale on my street this month. I live in one of he nicer areas too. My wife says the new listings are starting to overwhelm the office.
The Mortgage Forgiveness Dept Relief act of 2007 expires at the end of the year and most likely will not be renewed by our dis-functional fed government. So if you are under water and are going to try and short sale you need to get it done before Dec 31 or you will get a visit from the tax man next year. Expect many more for sale signs to show up, thinking of doing it myself as I'm 100k underwater currently.
Maybe someone versed in tax law can answer this one. I was told since you don't have to pay tax on gains from your principle residence after living there two years, that the "gain" from default/deficiency would not be taxable either. Is the deficiency treated as income or a capital gain? That would be the difference.
Deficiencies are treated as debt cancellation (and therefore income), and are also non-taxable according to the Mortgage Relief Act (so long as requirements are met). This is stated on many financial websites. What is unclear to me is whether the timing matters. It seems that after the foreclosure goes through, is when many banks come after the seller for the deficiency amount. (I don't know if the deficiency forgiveness must occur as part of the foreclosure process in order to be covered, or if it is also covered if it occurs later)
I am not a tax professional, but this is how I understand the language.
"If the outstanding loan balance was more than the FMV of the property and the lender cancels all or part of the remaining loan balance, you also may realize ordinary income from the cancellation of debt. You must report this income on your return unless certain excep- tions or exclusions apply."
The definitions given elsewhere in the doc imply that forgiven amounts are "debt cancelation" and therefore "income" rather than capital gain.
http://www.irs.gov/pub/irs-pdf/p4681.pdf
http://www.irs.gov/individuals/article/0,,id=179414,00.html/
The reason for it being income instead of cap gain is that at the time you took out the loan, the funds borrowed were not income, because you owed them to the lender.
Once they are no longer owed to the lender, that relationshiop changes and it is now income. (as opposed to gain on the value of the house).
So the origin of that money is the LOAN not an increase in value (cap gain). And a loan that doesn't have to be paid back is classified as income.
As I understand it anyway.
Yep there is really pent up demand on the sell side. I know personally of 4 people on my street that are just waiting for a slight uptick to go on the market, all boomers
try pent up supply.
i bought my condo in a chicago suburb for 227k in 2002 and now im trying to sell it for 175k..had some showings but no offer its 3 bed 2 bath 1700 sq feet on the 3rd (top) floor with a elevator and 1 parking spot in the garage..at least im not under water (owe 165 on the mortgage..)
my buddy bought a place in Cali outside LA for $1.2 ... now it's $725,000......and he has to move back to NC.
Ouch!
friend of mine bought at $1.35 in Cali and sold at $875K and moved to Texas
Not to offend you but you are underwater if you add all the money for maintenance and condo fees you have spent.
Does it come with a washer and dryer and what are association dues like?
Right now Im associated to death...
1400 here we come! All news is great news looking through our new Bernanke glasses.
Philly Fed blows too. -12.9 on estimates of -10.
global warming causing it...I am sure of it.....
I know this is beating a dead horse, but how frustrating is it to watch the equity markets trade like this? THE DATA THIS MORNING IS AWFUL! You can't paint it any other way and this is bullish because the Bernank is assumed to have is finger on the button. I am in the camp of no QE in August (maybe not even September). It is a sad state of affairs for our market economy to be so dependant on what a group of talking heads says or does. Keep stacking, continue having an opinion, and continue to tell the story. We are watching the world change.
TT
He's got the QE carrot on a stick and the jackasses are following it. The FED does nothing but blow bubbles and then deny their existance. You may be right on the timing, I think he dangles the carrot it as long as he can and tries to avoid the heroin before the election.
The market is all that's left holding up the house of cards. When it crashes, it's lights out right?
The Vapor Volume Bulls on a rampage.
Good news, bad news, no news, don't matter.
Fundamentals, technicals, charts, don't matter.
Free money from the Fed. Pump up the stinking corpse of the market and party on.
Cash for Casas!
This is the "good" season for home sales too. Get the family moved in time to start the new school year, before winter starts, and all of that...
There was a time when waterfront up in my area would sell within days. Residents in this one area would have people coming to their doors every so often and they'd offer wild sums. One family was offered a riduculous sum for a basic home - with a bonus if they'd move within 30 days. They took it.
Now? In-law's home on the water has been for sale for quite some time. A few showings but not a single nibble. Other properties in the area have since gone up for sale -- but no movement at all.
So, people here who thought their real estate would never be hit by the economy have been forced to see things differently. Now formerly multi-million dollar second homes of executives, et. al. have just hit the market in droves. None selling. Real estate agents still spewing their b.s. however to make people think otherwise but the ongoing listings tell the real story.
The ONLY thing happening in the US market is apartment rents are increasing and more apartments are being built.
And a 30,000 page Dodd-Frank will REALLY help housing. NOT!!!!!!1
http://confoundedinterest.wordpress.com/2012/07/18/apartment-starts-increase-single-units-remain-in-a-slumber/
rents are dropping in my area...too many houses and apartments...they now give 6 months free rent.... oversupplied with apartments and vacant houses turned into rentals. Another Bubble in rental properties.
Sort of a "Double Bubble" you might say.
that's what I call Michelle Carbrusa Cabrerra
What part of the country might you be from? Just curious. Many are complaining about the lack of rentals. Goodness, if it is a warm locale, I might have to check it out.
Love the smell of napalm in the morning.
Think Cramer's on fire.
you cant blame obama for this. he didnt build this economy , he was on vacation.
The "stock market is NOT the economy". Weird, but true.
Stop the marxist now
well skynet seems fine with all of it thus far as everything is still green.
I wonder, have the humans become so uninvolved that they have forgotten where the exits are?
now just might be a good time to become reacquainted with one...
How do they blame the weather this time? El Nino? Tornadoes? Earthquakes? Solar flares? Floods? Biblical catastrophes? Aliens?
Never, ever blame politicians and banksters.
The banks are WITHHOLDING VACANT REOs (1.5 mil) to prop prices and not mark to a loss. That's the CRIME.
I will be on Fox Business at 1pm EST with Melissa Francis and Lori Rothman discussing this exact topic. WHAT RECOVERY?
I will show the MBA mortgage purchase applications from yesterday. PURGATORY!!!!!!
http://confoundedinterest.wordpress.com/2012/07/18/mortgage-refinancing-rise-21-63-harp-producing-in-underwater-sand-states/
talk about this !!!!
http://montclair.patch.com/articles/new-tax-bills-frustrate-taxpayers
this is exactly why it doesnt matter what fucking lies they tell about housing !!!!!!!!
http://montclair.patch.com/articles/new-tax-bills-frustrate-taxpayers
Diana Olick is the only person on CNBS worth listening to beside Santelli. Thankfully we get to listen to Liesman interrupt a dozen times with his "economic" input. Liesman "Housing's been probably the single bright spot in this economy..." LOL Lies-man living up to his name.
It's simple; the banks are holding on to REO properties to stablize the markets. This approach is being driven by Geithner and Bernake. Others with adequate equity (e.g., old people) are putting their properties on the market but getting less.
I think stabilizing the market is one component of the story but it is not the whole picture. Everyone seems to forget about all the seconds and HELOCS issued against these properties. Dodd-Frank changed the rules for appraisals and allowed the banks to hide the sausage even better when it comes to first mortgages on primary residences, but it did not address seconds. My guess is the banks have a large asset on their books in the form of seconds that would be wiped out if they intiated a foreclosure.
Ding Dong.
Give that man the banana.
Delay and pray it is.
Further preparation for the QE3 launch.....now we just need a controlled 'crash' in the stock market.
So what would one start at in todays market, if they were entertaining the idea of buying a house? I have heard 25% right off the bat. Thoughts?
"more demand than supply" .... ROFLMFAOLOLÈÃØýýýýý
10 million houses in "shadow inventory." Banks are trying to hyperinflate their way out of it but it isn't happening. There are millions of houses damaged, destroyed and being squatted in as I type this. All "shadow inventory." High finance in America is the biggest slumlord in world history.
10 million houses are worth less than the mortgage. A lot of these are owned by people 50 and up...
Which brings me to point number 3...
Old people don't want houses anymore. They want apartments, condos and nursing homes. They want to sell their houses badly. Out of the remaining 80 million houses out of 20 million total, how many are old people who want to downgrade?
So...There's the rub. 25+ million out of 100 million houses are on the market and nobody wants to buy. The young can't buy. They've got too much credit card, car and student loan debt. A college grad averages about 35 grand in debt and their job (if they have one!) certainly doesn't put them in the position to be putting tens of thousands down on a 20 to 25 percent down purchase on a mortgage. Car, credit card, college. They've already got their mortgage.
Right now we are in the midst of a multi-trillion, multi-generational game of chicken. 25 million houses are waiting for the market to "go up" and all the young people can't buy so they are waiting for the "bottom" and nobody's doing much of anything. It is like the Phony Mortgage War.
The spectacular kicker? People are still building houses and apartments. The Hot Thing right now is a "luxury condo." Home developer and REIT stock goes up if they lose less money than they were projected to. The market is a complete malinvestment madhouse.