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Call it Crazy says

Logan Mohtashami says

See how sluggish starts number were today, these are numbers coming in year 7 of the economic cycle with 3.75% rates. This was what I have been talking about for years going against the Housing is Nirvana crowd

Wait, didn't we get a GREAT report from home builders yesterday?

You guys are such a disappointment. Here are some easy to see truths:
It was housing that caused the Great Recession of 2008, and it will be housing that leads to a Great Recovery.
1.They say homes are not affordable. How can that be when the affordability indexes clearly show housing is more affordable, even pre bubble.
2. They say there are no jobs. How can that be when the unemployment rate has kept improving in the last 4 years.
3. They say homes are a bad investment. How can that be when the CAP rates are so incredibly high? OC as an e.g.. was traditionally 2%, but now it's around 4% inspite of price increases since 2012.
4. They say payments are too high. How can that be when rental properties are being snapped up inspite of ever increasing rents.
5. They say loans are not easily available. You finally got the truth.

Strategist says

1.They say homes are not affordable. How can that be when the affordability indexes clearly show housing is more affordable, even pre bubble.

Once again, the affordability index is based on model that every single American has 20% down and a starting DTI ratio. I have seen hilarious index models in my life but this has to be the single worst one ever created.

If housing is so affordable why does it have it's worse demand on record post WWII adjusting to working population, living population and the lowest rate curve since the 1941-1945 as that was the last time in American history that the 10 year was this low

“All truths are easy to understand once they are discovered; the point is to discover them.”
― Galileo Galilei

Strategist says

2. They say there are no jobs. How can that be when the unemployment rate has kept improving in the last 4 years.

There are plenty of jobs, over 10 million created since job cycle turned in 2010 and yet the velocity impact on net demand

Once again, the worst demand post WWII adjusting to working & living population at the lowest rate curve post WWII

“All truths are easy to understand once they are discovered; the point is to discover them.”
― Galileo Galilei

Strategist says

3. They say homes are a bad investment. How can that be when the CAP rates are so incredibly high? OC as an e.g.. was traditionally 2%, but now it's around 4% inspite of price increases since 2012.

Housing is the cost of shelter to your own capacity to own the debt, that's always been my take, you will never see me whore myself out like real estate agents to push housing.
People buy homes to live in it, investors buy homes for profits

You should never need to urge to sell the thesis of shelter, if you do, that must mean something is wrong

Strategist says

4. They say payments are too high. How can that be when rental properties are being snapped up inspite of ever increasing rents.

Again, why has mortgage demand been so low? one of the factors that has been examined by a lot housing groups is that rents are high... and saving for a down payment is much more difficult now with rent inflation.

Catch the theme here

Strategist says

5. They say loans are not easily available. You finally got the truth.

and back to the biggest myth in American economics, Lending isn't tight at all, people simply don't make enough money to own a home and you can no longer lie on your application about your income.

All truths are easy to understand once they are discovered; the point is to discover them.”
― Galileo Galilei

800+ credit score, debt free, and the ability to put down at least 20%. I don't thing getting a mortgage would be a problem. People who listen to dirt-bag Realtard's and mortgage brokers end up with financial problems.

jvolstad says

800+ credit score, debt free, and the ability to put down at least 20%

If your DTI is under 43% you can easily get a mortgage. Heck if it's even 43%-50% you could still get a mortgage

There has been just too much emphaise on fico scores when they have the least impact on a the capacity to own the debt. Incomes and assets Debt to income ratio mean much for to the equation than a fico score does which is mostly used as a risk pricing model

Mark Zandi made this horrible thesis last year that I just couldn't let slide
http://loganmohtashami.com/2014/01/27/mark-zandi-its-the-economy-stupid/

Even the Wall Street Journal is finally throwing the towel and I have tried to press them on this issue for 3 years

Better late than never

Nick Timiraos ‏@NickTimiraos
Weakest. Housing recovery. Ever. http://on.wsj.com/1JNOEVv

https://www.9OpIbiFmY60

Logan Mohtashami says

Strategist says

5. They say loans are not easily available. You finally got the truth.

and back to the biggest myth in American economics, Lending isn't tight at all, people simply don't make enough money to own a home and you can no longer lie on your application about your income.

Arrrgghhhh!