As predicted, the brain dead and worthless MSM lead with the change versus last month, down a shocking 8.4%, and go with The Corrupt David Lereah's excuse that it was "bad weather" and that he expected the drop. Yeah, right.
Some days folks, you just gotta marvel at the incompetence and laziness of the MSM... At the same time you have to marvel at the swiftness of this American housing crash that's now gathering steam.
Here's the real headline, care of HP:
USED HOME SALES CRASH 13% VERSUS PRIOR YEAR, MEDIAN PRICE NOW DOWN AT LEAST $13,200 OR 6% FROM PEAK ACCORDING TO FLAWED NAR STUDY. UNWANTED HOME INVENTORY UP AT LEAST 17% VERSUS PRIOR YEAR TO 7.3 MONTH SUPPLY. NAR MOUTHPIECE DAVID LEREAH HILARIOUSLY BLAMES HOUSING CRASH ON WEATHER.
NAR Data: Sales: March 2007 482,000 vs. March 2006 554,000. Median Price: March 2007 $217,000 vs. $230,200 July 2006 peak
And here's the one of many MSM reports using the NAR spin:
Sales of existing homes plunged in March by the largest amount in nearly two decades, reflecting bad weather and increasing problems in the subprime mortgage market, a real estate trade group reported Tuesday.
The National Association of Realtors reported that sales of existing homes fell by 8.4 percent in March, compared to February. It was the biggest one-month decline since a 12.6 percent drop in January 1989, another period of recession conditions in housing. The drop left sales in March at a seasonally adjusted annual rate of 6.12 million units, the slowest pace since June 2003.
David Lereah, chief economist at the Realtors, attributed the big drop in part to bad weather in February, which discouraged shoppers and meant that sales that closed in March would be lower.
100 comments:
"David Lereah, chief economist at the Realtors, attributed the big drop in part to bad weather in February."
You heard - it was weather now go home everything is fine
Remember the NAR pending sales report a few weeks ago that said sales were rising that made the stock market rally?
http://www.courierpostonline.com/apps/pbcs.dll/article?AID=/20070410/BUSINESS01/704100327/1003/BUSINESS
David Lereah's must know something he's chief something right?
The silent spring has sprung and now the emperor has no cloths.
Can anyone remember the significance of 1989? That was the first year of last DECLINE in the RE sector. Prices did not recover in all areas of the conry until 00-01 when we were in the wram-up stage of the current bubble.
But Suzanne and Greg Swan said!
It's all over now except for the shouting
OK, so if Davey predicts 1-3% decline in house prices in 2007, and we meekly believe even that, then why the hell would anyone buy a house in 2007?
Like GM saying, "We predict our stock price will decline 3% (due to the weather), but now is a great time to buy our stock because margin rates are at historic lows!"
You people worry too much. The spring buying season is going to kick ass. What? Oh, this is spring. I meant spring of 2011.
Most sincerely yours,
David Lereah
The Winter 2007 buying season is going to kick ass !!!
WOW. I remember NAR's statement that a 5% drop in median price would represent an absolute disaster in the housing market. Now we are looking at at least a 6% drop, and probably much more this summer. Goodbye Denial, Hello Fear!!!
Well the SH*T will eally hit the fan in June/July. Housing prices peaked in June of last year to $230k versus $220 in March of 2006.
As prices continue to trend down over the next several months, to say $210, we'll be looking at almost a 10% decline in prices versus the previous year.
The, my friends, denial will only be a river in Egypt. Fear will start ruling the housing market.
Then the fun begins.
Or the NAR spins it so that the compare prices to the previous month so it doesn't look that bad. But so called "Economic Writers" and the MSM can't be that stupid?
Can they?
To the Anonymous troll who calls renters "losers"... this is just another big piece of evidence to prove you have your head firmly parked up your ass. I hope you lose everything you own.
Classic article from the folks at Minyanville about the housing market being contained (made me laugh):
http://tinyurl.com/2kuns5
America has placed itself into the greatest con game..and I would like to meet the genius who came up with it. Today Americians are "leasing" homes. First the genius says we need to find a way for homeowners to accept this game and want it so 1% teasers were created with heavy commission payments made for mortgage brokers to give them the incentive to push these finance options. Now America has bought homes that they could not have afforded as fixed rates and will never be able to afford at fixed rates. Ok..in 2 years..these homeowners need to now be bailed out..so now "THE BANKS" are comming to the rescue by offering to refinance your mortgage(notice how much Chase and Washingtion Mutual are advertising)..after they have made money on the subsidiary companies that they created that got you into the teaser mortgages have been closed down(the banks created these companies that made huge profits and now have just ceased operations..Visit www.ml-implode.com ) So they help the homeowner by putting them into what..ANOTHER ARM..why? because they could not afford the payments as fixed..So you are in effect LEASING your home..so every 2 years until you sell..you will have to return to the refinance game...It goes on and on....
yup it was cold in Feb, therefore fewer homes were sold than last Feb since usually Feb is hot and this year is some wierd El Nino thing that is making winter cold
I buy that explanation.
"Sales of existing homes plunged in March by the largest amount in nearly two decades, reflecting bad weather "
How many times are we going to hear the lame "bad weather" excuse?
Still, Lereah said low mortgage rates and reduced prices from sellers wary of the soft market should help sales to gradually improve during the second half of this year. He said weak sales are "masking improved fundamentals in the housing market."
man you people are clueless.
Houses are still way expensive. Big deal they go down a few thousand dollars, you still can't afford one.
face it you missed out, now go back to renting your apartment from me. If I can't make the mortgage I will just charge you more so I can. Dopes!
How long until Lereah blames it all on global warming?
"David Lereah, chief economist at the Realtors, attributed the big drop in part to bad weather in February..."
-----
Uh....Phoenix, where the inventory has skyrocketed, had FANTASTIC weather in February, as it does every year, so what the f***?
This guy must think people are incredibly dumb.
Well...he's right about that.
B..B..Bu..But..zillow says my house value has gone up sincle last year??!!??
...face it you missed out, now go back to renting your apartment from me.
_____
If things were that ducky for you, you wouldn't bother posting on this blog...
"If I can't make the mortgage I will just charge you more so I can. Dopes!"
LOL!!! I truly believe that you are stupid enough to believe you can really do that. You are so stupid!. I will be celebrating the day you are foreclosed up, you scum bag!
You can't increase my rent. You have no pricing power and I would be happy to move. You're competing against FBs who can't sell and have decided to become landlords like yourself. Enjoy mowing the lawn.
I am moving today, yes sold my home and everything....thank god I got out in time.
I got to chatting with the movers, and boy they are hurting. The driver told me he is seriously thinking of quitting and finding a new line of work since business is so down. He said a friend of his runs a truck lot in Florida and the lot is full of reposessed trucks, so much so that the lot is at full capacity.
But the thing they also get is that this isn't some temporary dip. They get the fact that the market is tanking due to the fact that people making $30K a year bought $600K homes. They get that everyone is spending more than they're making and the economy can't go on like that. Not to be an elitist prick, but these guys are movers. Blue collar guys, probably not the most edumacated guys out there, at least formal education. But they get it, crystal clear.
I read a lot on HP about how the sheeple all think everything is A-OK because the DOW is up. You greatly underestimate how much Joe 6 Pack "gets" these days.
I wish i could find a house for 217,000 i'd buy it. 517,000 where i live gets you a crap house in a crap area. where do they get 217,000. salt lake city 217,000 does not buy something you want to live in. The house price drop has just started. They keep talking about the bottom. It has just started. Wait until rates go up, there still cheap and thing are getting bad. Housing is to expensive bottom line. 100,000 salary should only get you a 250,000 loan max. How many people make 100,000. not many.
face it you missed out, now go back to renting your apartment from me. If I can't make the mortgage I will just charge you more so I can. Dopes!
By making this statement, it is obvious that you don't own any rental property.
Also, a lot of us did real well by selling at the peak and renting by the way.
Like I said yesterday:
At some point, YOY and MOM are both going to turn negative...
Keith, it's time for Munch's Scream to make another appearance.
A few things...
Is there ANYTHING, ANYONE can do to PUBLICLY humiliate Mr. Lereah?
I'm currently renting here in Columbus, OH, having sold my home late last year. Unwanted home (God, I love that phrase!) inventory is at record levels, but lots of "Price Reduced" signs are popping up.
The major home builders here in Columbus reported 25-50% drop in sales from last quarter.
A Realtor called me yesterday, basically begging me to buy one of her many homes - she knows I'm sitting on cash. One particular seller is really desperate - moved out of state, carrying 2 mortgages now + taxes + utilities + maintenance.
Yeah, we're FINALLY seeing the meltdown happening here in Columbus.
NOTE TO COLUMBUS REALTORS AND HOME SELLERS, PARTICULARLY IN DUBLIN AND NEW ALBANY: I DON'T GIVE A RAT'S ASS WHAT YOU PAID FOR YOUR HOUSE 3 YEARS AGO, OR WHAT YOU "THINK" IT'S "WORTH." DROP YOUR ASKING PRICE BY 30% *NOW* AND *MAYBE* I'LL COME TO YOUR OPEN HOUSE - AND YOU BETTER DAMN WELL HAVE SOME DELICIOUS, WARM CHOCOLATE CHIP COOKIES WAITING FOR ME!
Finally, does anyone here think that if I were to stand outside one of my local developments with a sign that says "HOMES HERE ARE OVERPRICED! DON'T BUY UNTIL A 30% PRICE DROP" that I I might be putting myself in physical danger by angry homeowners?
socal was about as mild a winter as i have seen in 36 years. Not much rain at all.
Keith, you're posting the anon troll comments for for humour's sake right? There's just no other explanation.
It is so nice to be away from the housing mess for a few weeks and be enjoying the warmest April on record in Switzerland (global warming?) According to local San Diego blogs, about every third house for sale seems to be in foreclosure, the NAR can't hide the facts anymore, Phoenix probably hit 60K, and a reporter for the SF Chronicle said he got 90 emails from angry people who are AGAINST a bailout (yea!!!). . .so, except for the dollar which is in the toilet (a CHF used to cost me 75 cents - now 83 cents) things are great - I should be able to buy that million dollar condo in SF next year for 500K!
batman, I'm not smart enough to pretend to be dumb enough to be posting what the anonytrolls are putting up lately
but it sure is enjoyable. in a watching-a-train-wreck sort of way
I wish they had user names though so we can continue to mock them for years to come.
The Harvard MBA class of 2020, when studying the housing crash, will read these comments and laugh and laugh and laugh at how dumb some people were, even in the face of the obvious
HP loves its trolls. I hope they never leave (or shoot themselves)
I don't get the "blame the weather" thing. It's a SEASONALLY ADJUSTED report.
Someone needs to tell David that means it's already adjusted for the seasons.
mark in zurich - I never got my board out this year. global warming sucks for european skiing
how the housing prices in zurich? and is the US housing crash being reported there?
Can someone with a clue explain to me how the stock market is even up today with dismal housing nymbers and weak consumer confidence????...I just dont get it.. I have been reading this blog since the inception and finally the writing is in print..
Anonymous said...
man you people are clueless.
Houses are still way expensive. Big deal they go down a few thousand dollars, you still can't afford one.
face it you missed out, now go back to renting your apartment from me. If I can't make the mortgage I will just charge you more so I can. Dopes!
April 24, 2007 4:28 PM
---------
I SAY AGAIN "SPRING HAS SPRUNG"
and the "FOR SALE" signs/flowers have all matured into "FOR RENT" signs/flowers. Feel free to jack up the rent & watch your tenant move in across the street for less leaving you with a vacant home. Any FB/homedebtor should thank his lucky stars if he is able to cover all his or her carrying costs AFTER all tax deductions/depreciation is taken in this market. I have several friends who've been suffering the slow bleed of losing several hundred dollars a month for over the last 10-20 years because they bought at the height of when the last RE bubble burst. The new bubble price would let them walk away with a little bit of money, but most opted not to because of all the REPAIR costs they deferred for so many years tipped now added up to the point the scales tipped to a loss!!
Good luck I sold my condo in the fall of 04 for a 200% tax free profit & I now rent the same space for less that the cost it would take to own & carry it. WHY? Fundamentals are completely out of wack & they will continue to be out of wack for at least the next 4-5 years. Anyone who puts 20% down now will have it wiped out in the next few years, wait, rent & let the FB/homedebtor carry the ball-n-chain as an indentured landlord. Rent a place you'd like to own & when they are at their breaking point, toss in a lowball for the then prevailing market conditions & justify it because you've been sucha good/loyal tenant. They will be so relieved to just dump the whole thing that they will thank you. Only caveate: make sure the FB/homedebtor is solvent & does not have a toxic loan. Ironically you need to check the LL's credit just as much as the LL needs to check yours!!
Here's some intelligence on the collapse that addresses not only the bubble bursting in housing itself but also the effects on illegal immigration and remittances sent by the slave labor back to their host nations.
Global consequences of US housing collapse
April 23, (EIRNS)--One of the unspoken, but predictable, consequences of collapse of the US housing bubble is being felt by the nation's immigrant community, and by their relatives back at home, in the form of collapsing remittances from workers to Mexico and other Central and South American countries. As reported in Monday's Wall Street Journal, remittances to Mexico have dropped from a peak of $2.6 billion/mo in May of '06, to a level of $1.7 billion/mo in Feb '07. Similarily, for the month of Febrauary, Brazil received $330 million, down 25% from $446 million in the same month last year, and Guatemala has dropped from a peak of $361 million last May, to $271 million this February. This is now coinciding with a slowing of the Mexican economy, which normally would lead to an increase in remittances as workers flowed toward the wages in the US. Now both are dropping. This has even led to a decrease in border crossings, as judged from the number of apprehensions by border patrol, which are down 10% for the first quarter of this year.
There goes another election issue for the Republicans.
Geee Mr. Lereah, I thought we hit bottom last month? Or was it January that you said we hit bottom?
I do recall Greenspan saying the we hit bottom a month or two ago as well. His sentiment was echoed by Bernanke and many of the regeional oracles at the Fed.
It would be interesting getting these schmucks drunk and actuallly hearing the truth for once.
...face it you missed out, now go back to renting your apartment from me.
++++++++
I see lots of great responses to this idiot's post.
If he tries to raise his rent, the renters (if he really has any) will simply move out and rent NEW HOUSES for probably less money, and more square feet. It will be a house-renter's paradise for years to come, I'm sure.
What a 'tard.
Oh no prices dropped 0.3%!! So my $800K home lost $2400 in value. I bought it for less than 1/2 that. Boo hoo for me.
Maybe it will drop another 0.3% or holy shit, maybe even 3%. Hell if it drops 30% I'll still be better off than having rented all along.
Let me put in a way the average HP renter can understand. Suppose I bought gold for $400 and it went up to $800 then came down to $790. That's where we are right now. You snicker and high five each other about a $10 loss yet ignore the $400 gain.
Whatever makes you happy I guess.
I am rubbing my hands with glee, we are near the end of the spring buying season when almost half of all homes are sold, and it has been a total FLOP. This summer is going to be a slaughter!
For more on the housing bubble and other breaking news of a strategic nature www.larouchepac.com
Federal Reserve: It's finished! LTCM-Type Emergency Bail-Out of Entire Mortgage Market.
April 22 (EIRNS)--Stepping back and reflecting on the pattern of the past week, it is clear that the Federal Reserve Board of Governors, in coordination with the Plunge Protection Team, is attempting to whip together and coordinate a huge bail-out of the subprime mortgage market, in order to save the entire $16.7 trillion U.S. mortgage bubble. Such a bailout will end in disaster. Lyndon LaRouche stated April 22, "The only thing to do is to freeze all the problem mortgages and to stop the foreclosures, as I've already said. We have to prevent massive evictions. If what I propose is not done, we are entering a phase in which what is occurring will blow out the entire financial system."
There has been an intense two weeks of panicked private and public meetings. On Monday April 16, a 7 hour meeting was held behind closed doors, at the Washington, DC headquarters of the Federal Deposit Insurance Coporation, involving the heads of the FDIC, Fannie Mae, Freddie Mac, very likely officials from the Fed, as well as leaders of banks, lending institutions and consumer groups. According to statements released afterward, those at the meeting "agreed on a goal of keeping deserving borrowers with high-risk mortgages in their homes."
The next day, April 17, the Federal Reserve Board of Governors released a joint statement, entitled "Statement on Working with Mortgage Borrowers," which had been drawn up in coordination with, and signed by the Federal Reserve; the U.S. Department of Housing and Urban Development (HUD); the FDIC; the National Credit Union Administration; the Office of the Comptroller of the Currency; and the Office of Thrift Supervision. The statement read in part:
"The federal financial institutions regulatory agencies encourage financial institutions to work constructively with residential borrowers who are financially unable to make their contractual payment obligations on their home loans. Prudent workout arrangements that are consistent with safe and sound lending practices are generally in the long-term best interest of both the financial institution and the borrower.
"Many residential borrowers may face significant payment increases when their adjustable rate mortgage (ARM) loans reset in the coming months. These borrowers may not have sufficient financial capacity to service a higher debt load, especially if they were qualified based on a low introductory payment....
"The [supervisory] agencies will continue to examine and supervise financial institutions according to existing standards. The agencies will not penalize financial institutions that pursue reasonable workout arrangements with borrowers who have encountered financial problems. Further, existing supervisory guidance and applicable accounting standards do not require institutions to immediately foreclose on the collateral underlying a loan when the borrower exhibits repayment difficulties. Institutions should identify and report credit risk, maintain an adequate allowance for loan losses, and recognize credit losses in a timely manner." (emphasis added)
The highlighted sentence will be remembered from the 1989-92 period, when in 1991, the Federal Reserve and other regulatory agencies issued a directive to bank examiners that urged "leniency" and "wide discretion" in deciding what a bad loan is. An emergency meeting was held Nov. 7, 1991 in Baltimore, Maryland to emphasize that point. At that moment, Citibank, America's largest bank, and other banks, had their books full of bad loans, and were hanging by a thread. The Fed feared a strict interpretation would push Citibank et al over the edge.
- Bringing in the Wall of Money Bailout -
On April 17, 2007, in accordance with the Federal Reserve's and other supervisory agencies' statement of the same day, "Statement on Working with Mortgage Borrowers," a wall of money policy was launched. Daniel H. Mudd, the chief executive officer of Fannie Mae, testified before the House Financial Services Committee, that Fannie Mae was altering its lending standards so that it "could help the subprime market through this turmoil," adding, "We are concerned about a liquidity crunch in the subprime segment." Mudd announced that Fannie Mae, the giant secondary housing market agency, was starting a new program, "Operation Home Stay," that would funnel funds into the subprime market. While he did not give a dollar funding figure, press reports have placed the funding level at between $5 and $20 billion.
On April 18, Freddie Mac, the other giant secondary housing market agency, announced that it will commit $20 billion to buy fixed-rate and adjustable rate mortgage (ARM) products, in an effort to provide mortgage-lending institutions with more "choices" to offer subprime lenders. Also on April 18, the Seattle-based Washington Mutual, one of the nation's largest mortgage lenders, announced a $2 billion program to help subprime borrowers. As well, on April 18-19, Citigroup Inc. and Bank of America Corp., announced that they would provide $1 billion in mortgage refinancing to the nonprofit, Boston-based Neighborhood Assistance Corporation of America to help those with subprime loans.
Thus, in a 96 hour period, the Federal Reserve and Plunge Protection Team had organized Fannie Mae, Freddie Mac, and the large money center banks to commit to a wall of money: thus far, between $28 and $43 billion in bail-out funding. This sum is between seven and ten times the size of the bail-out that the Fed organized in September, 1998, to save the LTCM hedge fund. The overriding interest of the Federal Reserve and the City of London and New York financier oligarchy, has nothing to do with the individual home-owner. They are trying to save their bankrupted system. It is evident to all that the full rupture of the $1.2 trillion market in subprime mortgages would be the trigger to bring down the multi-trillion U.S. housing bubble, and with it, the systemic breakdown of the world financial system.
On April 20, LaRouche stated even hundreds of billions of dollars of bail-outs would not be sufficient, it doesn't take account of the real scope of the problem. Now is the time to freeze troubled mortgages, and keep people in their homes.
6.12 million sales....that means there are 6.12 million complete fucking morons in the USA
Let me put in a way the average HP renter can understand. Suppose I bought gold for $400 and it went up to $800 then came down to $790. That's where we are right now. You snicker and high five each other about a $10 loss yet ignore the $400 gain.
+++++
Let me say it so YOU can understand. We're talking about the people who fed into the frenzy and bought at 2005 prices, and who are now totally screwed.
You bought your home at a low price and are hanging onto it, good for you, big deal, so did lots of people.
I bought in 93 and sold in 05, I'm hot sh|t too, big deal.
If I can't make the mortgage I will just charge you more so I can. Dopes!
Speaking of dope...
Last year my old landlord got the bright idea of trying to raise my rent $200 a month. NO WAY, GOOD BYE! Rented a much nicer, bigger place, so my rent actually went down.
The for rent sign is long gone, house always dark, no cars in the driveway. Low and behold one night one of the HPS lights must have been stuck on because you could see it shining out the skylight of one of the bedrooms.
When you FB's are forced to rent out your place for a grow op, make sure your "tenants" only use metal halide lamps, those HPS lights can be spotted a mile away!
GenX said...
Can someone with a clue explain to me how the stock market is even up today with dismal housing nymbers and weak consumer confidence????...
======
You're not aware that the dollar is crashing mightily?
Everything, US stocks included, costs more in US dollars to buy, because the US dollar buys less than it used to.
The stock market isn't really "up". It's DOWN. Priced in terms of US dollars, it LOOKS like it's up.
It's not.
Priced in terms of, say, lead, uranium, silver, gold, copper....the US stocket market has crashed, and badly.
Get it now?
Once again, as I have stated in other posts. The stock market is it's own animal that doesn't care about the economy, housing, etc... Traders rule the stock market. It could go either way in a bad or good economy. I'm an economics major and learned this back in college. Wall Street and Main Street have very little to do with each other. The media is full of idiots that try to give reasons for an up or down market. Forget it. It doesn't exist. Housing could go down the sh%thole and the stock market could hit record highs or vice versa.
March Existing Home Sales Down; Realtors Falsely Blame Mother Nature
David
Bubble Meter Blog
Anonymous said...
Oh no prices dropped 0.3%!! So my $800K home lost $2400 in value. I bought it for less than 1/2 that. Boo hoo for me.
Maybe it will drop another 0.3% or holy shit, maybe even 3%. Hell if it drops 30% I'll still be better off than having rented all along.
Let me put in a way the average HP renter can understand. Suppose I bought gold for $400 and it went up to $800 then came down to $790. That's where we are right now. You snicker and high five each other about a $10 loss yet ignore the $400 gain.
Whatever makes you happy I guess.
April 24, 2007 5:17 PM
---------
You're a pre-bubble buyer. Not a bubble height buyer. You're fine. Its all you're bubble buyer neighbors (to include those that over did it on the HELOC) who will be foreclosed upon around you that will have the most direct impact upon you're home's value. But its irrelevant if you're in it for the long term and the house is really a home for you. Unless the places does go to complete hell and the abandoned/foreclosed properties become crack houses then you've got other problems.
6.12 Million in a month, amazing, really. that is a 72 Million homes per year rate.
How many homes are there in the usa? One for every 2 people? that would be 150 Million homes which means, on average, every house sells every 2 years which seems unlikely. So, are there 300Million homes? One for every person? that would mean, on average, every house sells every 4 years which is probably about right, maybe.
Batman, what, he shouldn't post my comments because you want to live in a dream world, when I try and tell you the truth!
Oh by the way, the stock market is up again today! what a crash!
HAHAHAHAHAHAHAHAHA!!!!
I just made more money to cover any 1 % drop in my homes!
I think I am gonna raise the rent by the highest percentage possible this year just cause I can and you have to pay!
scratch my previous post. the 6.12million is a yearly rate, not monthly.
"Can someone with a clue explain to me how the stock market is even up today with dismal housing nymbers and weak consumer confidence????"
Cratering housing market = higher hopes of Fed rate cuts = more liquidity injections = more money for Wall Street, f@#$ everyone else.
Since the decline was so big in March, that means that April sales, no matter how low the numbers, have a good chance of still being higher than March's anemic numbers. I'm sure we will be hearing about the April increase from the NAR once the April results are in!
Keeferooni,
great image of the future of the Euro.
so much for 'german engeneering'.
Hey were you in that Pizzaria when this guy choped off his manhood?
may have been an FBer.
The Housing market is crashing big time.
but i would not bet against the US dollar.
The housing crash will have financial impact to some here in the US.
The Housing crash in Europe will be bigger and bloody.
The only thing to do is to freeze all the problem mortgages and to stop the foreclosures, as I've already said. We have to prevent massive evictions. If what I propose is not done, we are entering a phase in which what is occurring will blow out the entire financial system."
Now THAT'S scary: maybe EVERYONE should go buy a house NOW and then get it for free by not paying the mortgage! Brilliant idea!
Either way you cut it, we're headed for some DEEP DOO-DOO now....
What is David Lereah's training: weather post-caster, or hack economist?
Dave, while the average person may not remember MUCH, we DO remember the weather last month! Yes, a few areas had storms, etc, but it wasn't THAT bad.
Since weather is considered an "act of God", David better be damned cautious blaming all the market problems on God! He already deserves a prime shore location on the River Styx for various unmentioned crimes against consumers: blaming it all on God is just pushing the issue!
Lyndon LaDouche? Didn't he die in a plane crash years ago? If not, I wish he'd be the victim of a drive-by...
>> I am moving today, yes sold my home and everything....thank god I got out in time.
Yes, a day late and about $20k short...
QUOTE "Let me put in a way the average HP renter can understand. Suppose I bought gold for $400 and it went up to $800 then came down to $790. That's where we are right now. You snicker and high five each other about a $10 loss yet ignore the $400 gain."
Ah yes, but this thing is just beginning. You are lucky as you bought early enough, and I guess you were smart enough to not use your home equity as an ATM machine.
Anyone with even a high-school understanding of economics should know that we are on the verge of a major correction. THERE ARE NP BUYERS, and anyone who is buying is insane, and in a matter of months will join the desperate ranks of sellers.
QUOTE "6.12 million sales....that means there are 6.12 million complete fucking morons in the USA "
I think you will find there are more than that ;P
Can someone with a clue explain to me how the stock market is even up today with dismal housing nymbers and weak consumer confidence????...I just dont get it.. I have been reading this blog since the inception and finally the writing is in print..
Simple: April 17th was tax day, and anyone looking to deduct their SEP IRA deposit on their 2006 taxes had to mail it to their broker to put it in the market by then. So as expected, here's a HUGE influx of capital to Wall Street around this time, and as expected, the market swelled s money market managers put it into mutual funds, etc.
Also, remember some of the bear talk has had an effect, and those who sold their homes by selling pre-peak have put it into the Stock Market. For if not in stocks, where else would the typical seller place their money right now? Real estate? Nope. Stocks? Didn't we go thru the dot-com crash a few years ago, and that tanked? Yes, but people have short memories, and can't face the reality that we're in trouble here....
As you see, many are looking for places to soak up their excess liquidity, and there's no safe refuge right now.
Remember: when everyone's doing something, it's often NOT smart to join the crowd, especially at times like these.
Here is the real reason.
Mortgage Delinquencies Reach All-Time High
Monday, April 23, 2007
U.S. mortgage default rates hit an all-time high in the first quarter of 2007. Rising delinquencies will add additional pressure to a slowing housing market. But the real threat to the housing market and the economy is not the recent slew of sub-prime mortgage defaults, but the lending ramifications associated with widespread sub-prime bankruptcies.
According to Equifax, the percentage of mortgages in default rose to 2.87 percent—eclipsing the worst levels following the 2001 recession. In fact, defaults in many categories—first mortgages, second mortgages and home equity loans—were each significantly up.
Mississippi and Texas led a nationwide increase in the number of defaults. Actually, conditions deteriorated in all but six of the nation’s 50 states.
“The news is unremittingly bad,” said cnbc’s senior economic correspondent.
But so far, most of the housing carnage has been confined to sub-prime borrowers. As long as defaults do not spread to the general mortgage market, many economists feel the economy should be able to weather the storm.
However, the biggest threat to the housing market—and subsequently the economy—is not the rising number of sub-prime defaults. The sub-prime market as a percentage of overall loans is relatively small, and although foreclosure losses, and corporate lender and originator losses, will not help an already slowing economy, they probably won’t by themselves derail it.
The real threat to the economy is the tightening of credit conditions that are in large part a result of those sub-prime mortgage losses. With rising default rates and soaring investment losses, sub-prime lenders have tightened up their loan standards. The days of “anyone and their dog” being able to walk in off the street and receive a no-documentation, self-certified income loan are just about over.
Over the past few years, sub-prime loans have grown to take up one quarter of the U.S. mortgage market. In other words, a quarter of the nation’s home demand may be about to evaporate as sub-prime mortgage lenders continue to go bankrupt and lending standards are tightened.
Without that demand, housing prices, along with new construction, will probably continue to fall—two big challenges for an economy that has become dependent on a rising housing market.
"Maybe it will drop another 0.3% or holy shit, maybe even 3%. Hell if it drops 30% I'll still be better off than having rented all along."
Since you are better off, that applies to the entire country, right?
You do realize a 50% drop wipes out a %100 increase, right?
3% drop followed by 3% drop followed by 3% drop, year in and year out for ten or fifteen years will completely wither away all your "gains". It's actually moving faster than it should.
"AND YOU BETTER DAMN WELL HAVE SOME DELICIOUS, WARM CHOCOLATE CHIP COOKIES WAITING FOR ME!"
LOL. "Chocolate chip cookies" has to become a new catch phrase. Remember the snooty demands of sellers not long ago? Payback is you-know-what!
Anonymous said...
"Sales of existing homes plunged in March by the largest amount in nearly two decades, reflecting bad weather "
How many times are we going to hear the lame "bad weather" excuse?
They stole that line from the airlines. The plane is burning on the runway and they won't put you up for the night because "It's weather related..."
If there's a snowflake in Alaska and my flight from DC to Miami is delayed it's weather related.
We should start a game... Guess the spin... What'll be the reason for April's dismal sales numbers? And how much will the stock market rise with the news and spin??
We're still in denial folks... Deep in denial, but the cool thing is how quickly fear sets in. One minute everyone seems happy and content living in denial and then WHAM! people run screaming... :)
Also, let's not forget that these represent March sales, which are reported AFTER excrow closes. So in reality, these numbers represent sales and contract signings that occurred in Jan and Feb, BEFORE the sub-prime credit contraction started in March!
As anticipated, it's only going to get worse by Jun/July/Aug when we start to see the numbers from sales when sub-prime and alt-A figures come out the other end...
Anon 5:25 PM wrote,
"6.12 million sales....that means there are 6.12 million complete fucking morons in the USA"
-------------
It took a lot more than 6.12 million c.f. morons to put Bush back in office for a second term.
-Mammoth
What do you guys think about selling Housing Futures on the CME? I believe they are predicting something like 4% drop in home prices in the next 9 months.
Some problems I see are: how they calculate the home price, the liquidity of the housing futures market, and having a time factor to worry about(trying to time the market).
I believe the median price is calculated by the resell of the same home. It seems like there’s going to be problems with how they determine the price. For example, if it’s the same house, does that mean it will included remodeled homes which will naturally increase the value of the home?
I’m very experienced in stocks and analyzing companies but have never ventured into futures. Throughout the years I realized that being right in a bubble/bust situation is helpful, but everyone else thinks your insane. I’ve given up on trying to educate people that want to live in a dreamworld. I might as well profit from my knowledge. So what do you guys think about housing futures?
What do you guys think about selling Housing Futures on the CME? I believe they are predicting something like 4% drop in home prices in the next 9 months.
Some problems I see are: how they calculate the home price, the liquidity of the housing futures market, and having a time factor to worry about(trying to time the market).
I believe the median price is calculated by the resell of the same home. It seems like there’s going to be problems with how they determine the price. For example, if it’s the same house, does that mean it will included remodeled homes which will naturally increase the value of the home?
I’m very experienced in stocks and analyzing companies but have never ventured into futures. Throughout the years I realized that being right in a bubble/bust situation is helpful, but everyone else thinks your insane. I’ve given up on trying to educate people that want to live in a dreamworld. I might as well profit from my knowledge. So what do you guys think about housing futures?
Anon 5:17 said:
"Let me put in a way the average HP renter can understand. Suppose I bought gold for $400 and it went up to $800 then came down to $790. That's where we are right now. You snicker and high five each other about a $10 loss yet ignore the $400 gain."
Well said, I hope we have a 30-50% price reduction as much as anyone else who does'nt own multiple properties. Sadly though, it just aint gonna happen. The jews at the Federal Reserve have made sure of it. In most places, a $250,000 house in 05 money, will be a $250,000 in 08 money, the only difference is the money. The dollar being worth about 75% of what it was. This will happen by 08. The jews are printing them like they're gonna replace them with a new currency real soon.
This is what happens when you cut on the beat news reporting,and employ people within family,friend,circles cause he has good hair and she is cute.
Rarely do any of them have any hard questions during interviews for fear of losing access the MSM is sad very sad.
Anonymous 4:51 PM said...
I wish i could find a house for 217,000 i'd buy it. 517,000 where i live gets you a crap house in a crap area. where do they get 217,000. salt lake city 217,000 does not buy something you want to live in. The house price drop has just started. They keep talking about the bottom. It has just started. Wait until rates go up, there still cheap and thing are getting bad. Housing is to expensive bottom line. 100,000 salary should only get you a 250,000 loan max. How many people make 100,000. not many.
April 24, 2007 4:51 PM
Hey Anon 4:51PM. Pick yourself up a copy of the Green Bay Press Gazette. Looking at last Sundays paper, I see plenty of homes for under $150k. Of course, the weather here is brutal, and most people can't wait to retire and go somewhere warm. But a third of all workers make minimum, so even these houses are apt to be over priced.
Humboldt Road condo, heated inground pool, large deck, etc etc $54,000.
Madison street. $84,900. 2 bd home w/expandable upstairs, HW floors, new BA, tiled flrs, 2.5 stall garage & more.
Finger road. 3 bd 2 storey on 4.65 acres, 2.5 stall garage, enclosed porch & deck, $130K.
Golf Dr. 3bd 1.5 ba, split level located near the Woods golf course $143K.
And plenty more to pick from.
Folks, I hate to break it to you but this is not a good time to buy!!!
>The median price fell to $217,000 in March, from $217,600 in March 2006.
Can you imagine being such a bonehead that you'd be happy with a $600 price reduction to accept the incredible risk going forward.
I'd have held out for the $600 and a free pizza.
Stupid renters will be price dout forever so says Robert Toll
HANG ONTO YOUR HOUSE. HOME-BUILDING MAGNATE Robert Toll predicts that future U.S. home prices will climb so high in the next five years or so that the cost will represent 45% to 50% of household income, up from 21% in 2006.
The reason, he says, is that zoning boards are becoming so restrictive, there is very little new product being put in the pipeline. This will reduce future supply. The local planning and zoning approval process can take anywhere from three years to six years, depending on the jurisdiction, he says
David lereah should be in custody of the FBI about now.
Blame it on the rain, cmon dude.Don't we here that bshit every year?
I think they ran out of mirrors to fog with all these subprime darelicts.
The numbers are tainted as the masterful keith has clearly explained.It is all a ploy to keep joe sixpack in the game.
You hp'ers are too smart to fall for the bullsh@t.
"Now is the time to freeze troubled mortgages, and keep people in their homes"
So these people then get a free ride for doing something they should never have done in the first place? WTF???
Actually, they need to walk away, then when prices have dropped to what they should have been given a normal rate of inflation, then they can buy back in. They might be able to afford THAT price.
Let me put in a way the average HP renter can understand. Suppose I bought gold for $400 and it went up to $800 then came down to $790. That's where we are right now. You snicker and high five each other about a $10 loss yet ignore the $400 gain.
Of course, you conveniently underestimate the actual price declines to date in your strawman scenario. The notion that a 30% decline would leave most unfazed is laughable.
Further, what you ignore is this. The prudent renter who lives beneath his means and diligently invests what he saves by not homemoaning comes out ahead in the long run. This is so given historical rates of house price appreciation and historical rates of return on broad market equity indices. Factor in the interest the homemoaner pays (after all he generally is not an owner at all but is also renting, in his case renting money from the bank), property taxes, insurance, and maintenance, and it's a blowout in favor of the renter.
Of course, some harbor warm feelings associated with "ownership." The economic value of those is a matter of personal opinion.
The tremendous inflation in house prices over the past few years is a historical anomaly. If you benefitted by it, other than merely on paper, congratulations.
Now comes reversion to the mean. If you choose to hold through the reversion, you value the warm feelings more than I or can afford to lose.
I find it disgusting that my slacker friends many of whom ripped off senior citizen’s by convincing them to sell their homes (in many cases their only financial asset) only to be flipped by these swine for a generous profit. Where did these poor souls relocate? I know several guys who strictly targeted the elderly and poorer (minority) communities with the “money-for-homes” scheme. Some of these nimrods actually thought themselves to be astute businessmen.
On the other hand, there were people purchasing $800K homes on a postal worker’s salary using these interest-only loans in 2001-2005. Mind you, these same homes were going for $550K as late as 2000. I ask, what postal worker in his/her right mind thinks that he/she needs (or for that matter deserves) to live in a house that nearly cost $1 million?
Also given that Greenspan coined the phrase “Irrational Exuberance” as it related to the stock market, how come he said absolutely nothing about the more ridiculous and outrageous increase in home prices?!? I too believe that the NAR has been engage in a PR damage control campaign over the last year or so be spinning home sales data to keep the gravy train running.
Finally, did everyone forget what happened in 1991-92 in the Washington metro area?
The gravy train is coming to it’s last stop – Bustville!
Anyone who has been listening to Greg Swan is probably feeling REALLY STUPID by now. HAHAAHAH ROFL!!!!!
I find it disgusting that my slacker friends many of whom ripped off senior citizen’s by convincing them to sell their homes (in many cases their only financial asset) only to be flipped by these swine for a generous profit. Where did these poor souls relocate? I know several guys who strictly targeted the elderly and poorer (minority) communities with the “money-for-homes” scheme. Some of these nimrods actually thought themselves to be astute businessmen.
On the other hand, there were people purchasing $800K homes on a postal worker’s salary using these interest-only loans in 2001-2005. Mind you, these same homes were going for $550K as late as 2000. I ask, what postal worker in his/her right mind thinks that he/she needs (or for that matter deserves) to live in a house that nearly costs $1 million?
Also given that Greenspan coined the phrase “Irrational Exuberance” as it related to the stock market, how come he said absolutely nothing about the more ridiculous and outrageous increases in home prices?!? I too believe that the NAR has been engaged in a PR damage control campaign over the last year or so be, spinning home sales data to keep the gravy train running.
Finally, did everyone forget what happened in 1991-92 in the Washington metro area?
The gravy train is coming to its last stop – Bustville!
"America has placed itself into the greatest con game..and I would like to meet the genius who came up with it. "
See: Alan (Bubbles) Greenspan.
All BLAME BELONGS right at the front steps of the Federal Reserve.
How is this news being spun/reported in the US tonight folks? Fill an expat in.
This just has to be freaking out John Q. Public Homedebtor tonight, right?
Right?
Anyone watch the video? It was very appropriate I thought, given the gravity of the situation
By blaming a particular religious group for the housing bubble or other social ills, you lose all credibility and do nothing more than draw attention to your own insecurities.
although the bubble began to deflate in late 2005, i think March 2007 will go down in history as when the bubble actually pops due largely to the publicity around the subprime implosion
By the way, since I (easily) predicted the MSM would report the month over month number, and allow TCDL to blame it on the weather, don't you trust the MSM just a little bit less today than you did yesterday (if that was possible)?
Folks, we are in the mess today that we are in not just because of the people and organizations doing the evil, but because the MSM is no longer the check and balance it used to be.
You're on your own. Nobody is looking out for you anymore.
What is an FB?
A very silly person said:
"3% drop followed by 3% drop followed by 3% drop, year in and year out for ten or fifteen years will completely wither away all your "gains". It's actually moving faster than it should."
I see now, so we are in for 10-15 years of housing declines now. Hmm interesting how up until recently you tools were saying 7 year cycle, 7 year cycle. So now that we're 2 years into the downtunr and prices are down 5%, you start saying 15 year cycle.
Face it losers, you missed out on the greatest investment opportunity you will ever have. Prices will fall some, I agree. But for the vast majority of people who bought pre-2005 they will make out like bandits.
Notice how all the stories Keith posts are about people who bought recently, like 12-18 months ago. Never any story about someone who bought in 2002, tripled their money by 2005 and now still is up $400K after a "crash" of 5%.
Comeon HPers, afterall this spring was the worst spring weather that we have seen in the last 18 years- amazingly, this bad weather struck every single housing market in the good ole USA at the excat same time- well maybe, except for SF- apparently it did not hit there as prices are up.
Median down $13K...BFD!
Considering it was up $359k
NAR claim that existing home inventory DECLINED in March totally defies belief. There are literally hundreds of sources of local and regional March inventory data on the Net, including bloggers, local MLS tallies, state realtor associations, etc. And I can not find more than a couple in which inventory declined. In most cases, inventory increased by 3-6% in March. NAR is not telling the truth about inventory and that in turn is making the months of sales supply look lower than it should. NAR should be challenged to document their inventory numbers.
I love to read these imbeciles--
"Oh no prices dropped 0.3%!! So my $800K home lost $2400 in value. I bought it for less than 1/2 that. Boo hoo for me.
Maybe it will drop another 0.3% or holy shit, maybe even 3%. Hell if it drops 30% I'll still be better off than having rented all along."
Gee try selling it! How liquid is it? What good is 800k if it takes 6 months or more to sell? Do you think you will get that with inventory levels being what they are? O.K. sell it and send us proof and I will buy you a new car.
What will happen is this--more and more money will be printed--already the case. Inflation is understated by BLS and the twits will be happy. Sure $1.00 will be worth 45 cents but they will not get it as the "value" of their houses has increased. The whold nomial vs real indea is lost on a lot of people. If you calcualte in real terms, many places that report 15% declines in nominal prices are actually down 22% in real terms. Why Keith won;t they get it/ Well they (many FB and Trolls) are half literate imbeciles. In fact they are so stupid and ignorant they don't know how hard they are being screwed. Yep I rent and am happy I do. Sold out and now live where I want and not tied to keeping some banker happy.......
Anonymous said...
A very silly person said:
"3% drop followed by 3% drop followed by 3% drop, year in and year out for ten or fifteen years will completely wither away all your "gains". It's actually moving faster than it should."
I see now, so we are in for 10-15 years of housing declines now. Hmm interesting how up until recently you tools were saying 7 year cycle, 7 year cycle. So now that we're 2 years into the downtunr and prices are down 5%, you start saying 15 year cycle.
Face it losers, you missed out on the greatest investment opportunity you will ever have. Prices will fall some, I agree. But for the vast majority of people who bought pre-2005 they will make out like bandits.
Notice how all the stories Keith posts are about people who bought recently, like 12-18 months ago. Never any story about someone who bought in 2002, tripled their money by 2005 and now still is up $400K after a "crash" of 5%.
April 25, 2007 1:22 AM
---------
TYPICAL housing cycles run ~7 years which includes both the boom & the bust. The last bust had 4 years of severe drop (5%) then 4 years of flat/trough drops (1-3%).
SO RIDDLE ME THIS:
If the current bubble's boom period was over twice as long as the last's boom period wouldn't the bust/trough period of housing price drops have the potential to be twice as long? Do the math.
FYI if you can't thats 8 years x 2 =16 years!!
Ugggh, some are so denso out there. It will take major shock treatment or a year of high school math for some of the trolls to figure out that--50% gain is wiped out by a 33% decrease. A 100% gain is wiped out by a 50% decrease. God, lets get some more GED classes so these morons figure out how fucked they really are...
FB - good question.
At first I thought it meant Fat Bastard, but now I'm thinking it means Fucked Buyer.
Although I'm unsure of this.
I knew this was gonna happen as soon as I heard Bush was running for President back in 2000!
I knew it, I knew it, I knew it!
Fake election,
Fake promises,
Fake WMD's,
Fake 9/11 attack,
Fake 9/11 investigation,
Fake Iraq reports,
Fake national news,
Fake home values.
Hmmm... I wonder if anything else could be fake as well?
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