Work with me people!

Depending on your role in this housing debacle, I think we see a bit of denial still (shockingly), a lot of fear (homebuilders, lenders, realtors), some desperation (foreclosures, bankruptcies) and the first scenes of true panic (Northern Rock savers, Fannie Mae investors)

But where would you say the majority of Americans are today?

It's been illuminating to follow this chart these past few years. It simply showed us when it came to the Housing Ponzi Scheme what was happening, and what was to come, no matter what realtors on commission wanted you to believe.

People ask me all the time "when will it be safe to buy a house again"?

The answer? When the majority are disgusted by real estate as an investment. When there's true capitulation and despondency. And of course, when you can buy a home and rent it out for positive cash flow. We're still not even close.

When it comes to the Great Housing Crash and Mortgage Meltdown, without question, the United States has now moved to HousingFEAR stage

How do we know? Because we can look back on the lazy days of Denial as if it were a million years ago.

Simpler times, yes they were. Ignorant realtors were calling HP'ers "chicken littles" and "brown shirts". Sheeple were still out buying homes thinking they were appreciating. David Lereah and the NAR were putting out numbers without anyone laughing. Crisp and Cole weren't yet under FBI investigation. 61,000 Countrywide employees thought they had stable jobs.

Ah, but those days of Denial are over. Fear is here. And there's even a sprinkling of HousingDESPERATION in the air. And then, as we all know and expect, HousingPANIC. It hath been foretold.

Come on! Work with me people! Fear has to be here by now, eh? Let's get this crash over already and move on.

As the CEPR pointed out in their housing crash report the other day, Americans will be best off if we get this housing crash over quickly, versus the 10+ years Japan wasted.

If home prices are simply "Marked to Market", the old prices and expectations thrown away, then we could move on.

Home would start selling again. Builders could eventually start building again. Losses would be known, retirees would be able to prepare, new home buyers wouldn't go bankrupt, and existing home debtors wouldn't go out spending money they don't really have.

Or we can do this the long and painful way.

So work with me, people of America. Your home isn't worth anywhere near what it would have sold for in 2005. The funny money days are over. "Liar's Loans" are no more. Housing speculation is dead for a generation. The Ponzi Scheme is over.

And your house is worth what it was in 2000, at best.

Now deal with it.

Here's the thinking from the CEPR on this:

It is worth noting that from the standpoint of current homeowners and prospective homebuyers a quick unraveling is more desirable than a gradual one, even if the macroeconomic consequences may be more severe.

If a homeowner has a house that will lose a substantial portion of its value over the near future, then she will be better situated to deal with this loss of wealth if it happens sooner rather than if it is delayed for a substantial period of time.

For example, if the homeowner is preparing for retirement, she would benefit from knowing sooner rather than later how much equity she can actually expect to have accumulated from her house. This would allow her to plan her savings, and possibly her retirement decision based on her actual wealth rather than wealth that is only a bubble illusion.

Here's what housing crash desperation looks like

Thanks HP'er E.B. for the pic.

Got any funny ones send 'em in folks...

Next Desperate Homedebtors will be hiring these guys themselves to move their dead weight

HousingPANIC Stupid Question of the Day

Does it smell like housing crash fear yet in your town?

Nah, home prices aren't in freefall. Nah, there's no housing crash underway. Pssst... someone tell that to Lennar!

Hat-tip to Housingdoom (again) for this one. One word folks: FIRESALE!

Man, wanna have some fun? Run around to new home communities and ask for 50% off the original price. At least you'll get a nice counter offer. But obviously don't buy unless you can rent the place out for positive cash flow. Do that math with the builder on that one too...

Oh, for extra credit fun, go knock on doors in these new home communities and let the neighbors know how far their homes have fallen in value since they bought. Let 'em know the builder is conducting a historic firesale that will destroy the comps for years to come.

You might want to bring protection.

FLASH: D.R. Horton, America's largest homebuilder, in complete and total crash mode. CEO looking for any buyer with a pulse. And you can quote him.

It's rare when I see things that make my jaw drop. Well, here's one from D.R. Horton.

This kind of attitude should have Fannie, Freddie, the Banks and mortgage CDO investors worldwide shaking in their boots.

The housing game is in its last innings, and desperation and fraud are spinning out of control as desperate builders, desperate lenders and desperate homedebtors do anything, and I mean anything, to survive.

Home builder D.R. Horton earnings plunge 85 pct

NEW YORK (Reuters) - D.R. Horton Inc. , the largest U.S. home builder, said on Thursday quarterly earnings fell 85 percent, in part due to charges related to the lower value of land.

The U.S. housing market has been in a severe downturn for the past year, with a mounting glut of homes on the market, increasingly resistant prospective buyers and tighter lending standards.

Builders have responded by slashing prices, throwing in freebies and cutting back on "spec homes" -- those built speculatively without a buyer.

"We face head winds, we believe, and strong head winds, we believe, during the course of the next six to 12 months from , illiquidity in the mortgage industry," Tomnitz said.

"As I've said to all our salespeople, if a buyer is warm and has a pulse, we want to put them on paper," he said.

HousingPANIC Stupid Question of the Day

Gotta be Fear by now, eh? I know people are dumb, but they can't be THAT dumb, can they?

Are selling a home and ticket scalping similar? (hey there - who needs two?!)

BusinessWeek's Hot Property had this one the other day. For someone who buys tickets to events after they start from desperate scalpers looking to take any price, I thought the analogy was "spot-on" as they say here...

The panic that could occur in the housing market is akin to what I experience in buying tickets from scalpers at a rock concert.

A few minutes before the show starts, even professional scalpers lose their cool – vigorously competing against others, they drop their prices in an attempt to monetize the rapidly declining value of their tickets.

This results in drastic price drops.

What does rock concert ticket scalping have to do with the housing market you may be wondering…one concern is that much like ticket scalpers, sellers will aggressively discount their homes (to lock in profits or minimize losses) before they further decline in value.

This will lead to even more supply and lower prices.

What are the Sheeple who got taken gonna do?

Desperate Homedebtors who listened to charlatans like Greg Swann and bought in 2005 and 2006 (or god forbid 2007 - are people really that dumb?) are probably about now realizing that they got taken, that they were had (yet their real estate clerk and mortgage broker of course got paid).

What does a person do who realizes that one mistake, just one, has now ruined his financial future? What does a Desperate Homedebtor looking at foreclosure, short sale or massive losses on his Phoenix condo do?

Lawsuits?

Refund?

Bankruptcy?

Arson?

Violence?

Who does he blame? What will he do?

I think we're about to find out.

Stop denying Denial. It's Fear my friends. Fear.

HSBC moved $10 billion from the "denial" column straight to "capitulation" the other day.

The entire subprime industry, which fell off a cliff in the past few weeks, went from "euphoria" to "despondency" overnight it seems. And the contagion will spread. It always does during a the mania unwinding stage.

1.9 million American homes currently listed in foreclosure are in "desperation" stage.

2.2 million Americans who took out toxic loans and are expected to default, well, they've gotta be in "fear" stage now if they're paying attention.

Millions of REIC employees / contractors / commission hungry sharks are in "fear" stage today, wondering when the axe will fall, and how long they'll have to eat ramen.

The 2.1 million homedebtors with an empty home on the market and no buyers in sight have gotta be in some stage of "fear", "desperation" and yes, "panic" today.

One would-be real estate mogul who is now selling off his portfolio of failure and days away from bankruptcy and a knock from the FBI, well, even he's evidently moving past denial lately.

HP'ers, you'd have to be insane, clueless, corrupt, stupid and seriously the greatest fool on earth if you're still in "euphoria" or "anxiety" stage. Man, the train left the station, a long, long time ago. When will Americans (and the world) finally get on board? Or are they?