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Look how CNBC characterizes the most recent housing starts data http://www.cnbc.com/2015/07/17/strong-us-groundbreaking-building-permits-boost-housing-outlook.html
"U.S. housing starts rebounded strongly in June and building permits surged to a near eight-year high, pointing to a rapidly strengthening housing market."
Lots of new high end apartments in the area. New house sales, not so much. I guess people are starting to figure out the rent vs. buy equation.
Here is bloomberg's take on the new housing starts.
Why the Increase in Apartment Construction Isn't All Good News
http://www.bloomberg.com/news/articles/2015-07-17/why-the-increase-in-apartment-construction-isn-t-all-good-news
Yes the increase has been in mulit unit rental homes not single family homes just like the increase in the labor force participation rate has been for senior citizens not prime age working "folks"
I guess people are starting to figure out the rent vs. buy equation.
Not just figuring it out but can't even think about buying because they don't have the downpayment and/or can't qualify for the mortgage
Housing starts for single family homes are flat.
What went wrong?
Prices are too low. But not for long.
What went wrong?
See, I told you. Damn bankers say they have nothing to lend. :)
What went wrong?
What went wrong is the Fed usurping the business cycle, robbing the economy of new jobs.
I'm not sure what chart you look at to see that?
I'm not sure what chart you look at to see that?
The artificially low interest rates pull bad (malinvestment) and spending forward by offering low rates.
If there is not corresponding production and savings to back the spending OR returns from the malinestment, the recovery dissapates as consumers get tapped out on credit and businesses with no profits fail
The only way to prop up the consumer is to extend more credit and the only way to prop up unprofitable businesses is to give the high valuations so they can raise money on Nasadaq and stay in business
The artificially low interest rates pull bad (malinvestment) and spending forward by offering low rates.
If there is not corresponding production and savings to back the spending OR returns from the malinestment, the recovery dissapates as consumers get tapped out on credit and businesses with no profits fail
The only way to prop up the consumer is to extend more credit and the only way to prop up unprofitable businesses is to give the high valuations so they can raise money on Nasadaq and stay in business
Yes Louis dead on, but where is the chart that shows that?
I don't want to hear any of that a priori crap, I want to see empirical proof as in the charts like any good "scientist" would demand...
I don't want to hear any of that a priori crap, I want to see empirical proof as in the charts like any good "scientist" would demand...
Not everything can be distilled to a chart. Economics is called a dismal science for reason!
What would "apriori" have to do with anything?
DieBankOfAmericaPhukkingDie says
NOTHING WENT RIGHT! NOTHING!
Better perspective! But the Fed and their apologists are taking victory laps re the housing "recovery"
DieBankOfAmericaPhukkingDie says
A 'recovery' based on accounting fraud is a crime by another name.
It's not just an accounting fraud
the ignore button works wonders
Now that is some of the best advise I have seen on Pat net.
While two guys are debating, I'm wondering what is considered a healthy housing recovery? What should be the basis? 40% house ownership? 60% house ownership? Which year is the benchmark? Somehow I got the impression that USA is a nation of renters, typically 40% renters, 60% house ownership. Given that younger folks love to job hop (correct me if I'm wrong), what is the purpose of owning a house? Also, Americans prefer to get married later (correct me if I'm wrong), 35-40, so why need to buy a house?
40% house ownership? 60% house ownership?
Whatever the market decides, BUT there has been massive government intervention to create a homeownership society and all their programs have led to higher home prices and a lower homeownership rate
I do miss investment forum. Some good discussion have been had there.
Got Housing Recovery?
The homeownership rate is down.
New and existing home sales remain far below their 2005 peaks.
Housing starts for single family homes are flat.
What went wrong?
https://smaulgld.com/got-housing-recovery/
#housing