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Just ran across this: Why the housing recovery may be on its last legs http://www.ibtimes.com/housing-recovery-2013-may-be-its-last-legs-heres-why-1534940
rising prices are only part of a recovery
if sales are down and affordability is down its not a recovery-its a bailout
Great point smaulgld!!!
This whole bogus recovery scam should be obvious to most. Unfortunately the talking heads at CNBS and other places are trusted and believed by the lemmings. It will be a sad day when these buyers, or bagholders as I refer to them get stuck with their overpriced houses and have the choice to either sell at a loss or live in their homes for eternity and overpay their propped up inflated mortgages.
There are very few places in the U.S. where prices reflect reality...
rising prices is only part of a recovery
if sales are down and affordability is down its not a recovery-its a bailout
Rising prices don't mean much if total volume of sales are down and buyers don't have the wages or down payment to afford to buy...
The inventory situation shows that... With prices rising, you would expect more houses to come on the market. But, if a seller can't afford to buy the replacement house because of personal financial issues, it doesn't matter what the house price is.....
Correct at best rising home prices free up some inventory to meet limited or no demand
There are very few places in the U.S. where prices reflect reality...
and none more so than silicon valley and San Francisco
http://finance.yahoo.com/news/silicon-valley-economy-back-dot-com-era-highs-210054484.html
I agree that the housing market will continue with more modest 3-5% appreciation levels from this point upwards. We had a tremendous crash and the bottom was some point in early 2012...that was an amazing time to buy a home. The current recovery is just to a point where prices make sense vs market rents.
One needs to understand that the Fed has been printing money like it is going out of style and the new chief Yellen has promised to print even more if necessary. With this kind of policy there has been a lot of shadow inflation. In this environment prices of real assets like homes and their rental values go up.
The rental market here in Southern California is absolutely on fire, in some places rents have been skyrocketing at a 10-15% annual rate and people have no choice but to pay those rents. What else are they going to do...sleep on the streets??
I agree that the housing market will continue with more modest 3-5% appreciation levels from this point upwards.
Rising home prices is a distraction to the poor state of the overall real estate market and overall economy
It also goes against the basic fundamentals of what a normal "healthy" housing market has looked like for the past multiple decades...
and yet we are constantly told RECOVERY, RECOVERY RECOVERY
Housing recovery running out of steam (as if it ever existed) http://dealbook.nytimes.com/2013/12/24/housing-recovery-may-be-running-out-of-steam/?_php=true&_type=blogs&_r=0
Dallas Fed Says Housing Recovery is Here to Stay!
http://blogs.wsj.com/economics/2014/01/15/housing-recovery-is-here-to-stay-dallas-fed-says/
Rising home prices is a distraction to the poor state of the overall real
estate market and overall economy
and yet we are constantly told RECOVERY, RECOVERY RECOVERY
Housing recovery running out of steam (as if it ever existed)
Dallas Fed Says Housing Recovery is Here to Stay!
LOL, so which one of the above is it then? You've managed to contradict yourself in the last 4 out of 5 posts.
I didn't contradict myself- I presented other points of view
Mine is clear rising home prices have not translated into a healthy real estate market or economy as home sales are low, affordability is high, the labor participation rate is down as is home ownership
There sure are investors in this market but they are only a smaller percentage of the total buyer pool. There are plenty of organic buyers here in Los Angeles/Orange County willing to pay the insane prices commanded by homes here.
Remember also that if you look at the rest of the world housing has traditionally been extremely expensive and out of reach for the middle class which typically rents.
I was in Barcelona recently and looked at a few properties there and it's insane what homes cost, a 1500 sqft home in a good Barcelona suburb can sell for 1 million euros easy. And just look at the economy of Spain - 40% youth unemployment and pitiful salaries compared to the United States.
In my field, a Sr. Software Engineer, it pays $120,000 in Los Angeles whereas only $50,000 if I am lucky in Spain, in addition the taxes in Spain are substantially higher. YET, homes sell for much more than here.
My point is that US housing has historically been ultra cheap and now it is equalizing with the rest of the world. Going forward the middle class may not be able to achieve homeownership, which is sad in a way, but those that already bought should be fine and they are "on the boat" as they say - and they can eventually pass their home down to their children like happens elsewhere.
I hope he doesn't blame it on the snow today!!
Yes if it wasn't for the snow home prices would have risen today even if no homes were bought
In my field, a Sr. Software Engineer, it pays $120,000 in Los Angeles whereas
only $50,000 if I am lucky in Spain, in addition the taxes in Spain are
substantially higher. YET, homes sell for much more than here.
You are only using California as a data point, this does not necessarily apply to to the other 49 states.
You are only using California as a data point, this does not necessarily apply to to the other 49 states.
Or the rest of California
I was in Barcelona recently and looked at a few properties there and it's insane what homes cost, a 1500 sqft home in a good Barcelona suburb can sell for 1 million euros easy.
Sure, and a 1500 sqft house in Palo Alto can cost double that.
On the other hand as I've already shown on this forum its also possible to buy a nice place in San Sebastian for about as much as an equivalent place in Stockton.
Wait, don't you mean the other 56 states??
Yes, the breathalizer must not be working
Sure, and a 1500 sqft house in Palo Alto can cost double that.
On the other hand as I've already shown on this forum its also possible to buy a nice place in San Sebastian for about as much as an equivalent place in Stockton.
US housing is not "cheap" at least not by historic standards as measured by income to home price
Sure, and a 1500 sqft house in Palo Alto can cost double that.
On the other hand as I've already shown on this forum its also possible to buy a nice place in San Sebastian for about as much as an equivalent place in Stockton.
US housing is not "cheap" at least not by historic standards as measured by income to home price
Perhaps not by that metric but how about income to mortgage payment?
Perhaps not by that metric but how about income to mortgage payment?
If you lower the income to mortgage payment but the income to home price remains the same or goes higher, it just means that you are paying more for a home and taking out a mortgage on longer/more favorable terms, but you are still paying more and indeed you become more indebteded
http://www.cnbc.com/id/101326470
I send all my blog posts to Olick and the Trulia economist-looks like a repeat of my 2013 posts
Housing Recovery Takes another blow as pending home sales drop
http://www.nbcnews.com/business/real-estate/housing-recovery-takes-another-blow-pending-home-sales-tumble-f8C11479242
Of course, its the weather...
Housing Recovery Takes another blow as pending home sales drop
Of course, its the weather...
Sales down equates to prices up!
Non Farm payroll comes in again a big miss- must be the weather!
In any event, fewer people without jobs, few people to buy homes:
RECOVERY!
http://www.investing.com/news/economic-indicators/u.s.-non-farm-payrolls-113k-vs.-185k-forecast-265103
didn't these guys know what the whether was like when they made their forcasts?
btw construction jobs were up in the latest report in the cold weather
didn't these guys know what the whether was like when they made their forcasts?
Probably not.... It's tough to see the "real" world from your warm and comfortable marble palaces and empires.....
That or stupidity has to be the reason
btw construction jobs were up in the latest report in the cold weather
You mean those "shovel ready" jobs are finally here after 5 years??
"snow" shovel ready
After reading this, check out the forum article titled "The housing recovery is a bank-promoted pump-and-dump scheme".
It's just another illustration of this same principle....
After reading this, check out the forum article titled "The housing recovery is a bank-promoted pump-and-dump scheme".
It's just another illustration of this same principle....
Yep here it is http://ochousingnews.com/housing-recovery-bank-promoted-pump-dump-scheme/
And the media is complicit in calling the whole thing a "recovery"
The Housing "Recovery" was a farce in February and even more so today
First time homebuyers are STILL 26%, new home sales are stagnant at near historic lows and they still try to proclaim there is a housing "recovery".
That surge in millennial home buying never happened https://smaulgld.com/waiting-for-household-formation/
e only thing that kept it propped up was distressed sales and investor sales. Once the "deals" cleared the pipeline, the normal organic buyers won't fill that void.
There are no organic buyers in large enough numbers to sustain the "recovery":
/?p=1240049
http://smaulgld.com/why-the-housing-recovery-is-a-farce-illustrated-by-two-charts/
Annual Existing Home Sales vs. Annual Existing Home Sales By First Time Home Buyers
New Home Sales
http://smaulgld.com/why-the-housing-recovery-is-a-farce-illustrated-by-two-charts/
#housing