The smart money had a goal, which it now reached via the “multiplier effect” by which a small number of sales can have extreme consequences in price for the rest.
Entries in Housing (62)
It always starts with a toxic mix: Home sales plunged and inventories jumped in May. The housing market is buckling under its own inflated weight.
“Recently, the billionaire venture capitalist Vinod Khosla went hunting for one-bedroom apartments in San Francisco....” And then he opened his mouth.
When the home-sales curve kinked south last fall, soothsayers had some handy reasons. And it would be temporary. Month after month, they came up with new reasons. Now they’ve used up all the good ones, but sales are still tanking.
This is precisely what shouldn’t have happened but was destined to happen: as prices are soaring, only luxury home sales are growing ... 1% of the market! Something has to give.
The equation might not have gone so horribly awry if each class of graduates had seen their incomes skyrocket in line with their student debt. But that’s a crummy joke in America.
Home prices in San Francisco hit $945,000 in February, 16% above the prior peak. But momentum stocks, which the city is addicted to, are crashing. With terrible results.
That’s how it always starts: with a deadly mix. Home sales are collapsing while inventories are soaring in six housing markets that had been white-hot just a few months ago.
This chart is a hair-raising picture of Canadian home prices that makes the torrid excesses of the US housing bubble look banal
The gap between Canadian and US home prices is at an all-time record, with prices in Canada now 66% higher than in the US. And risks are piling up.
They’re not even trying to blame the weather this time. “Housing affordability is really taking a bite out of the market,” is how the chief economist for the California Association of Realtors explained the March home sales fiasco. “We haven’t seen this issue since 2007.”
Hot Air Hisses Out Of Housing Bubble 2.0: Even Two Middle-Class Incomes Aren’t Enough Anymore To Buy A Median Home
Giant PE firms and REITs have become the largest landlords in the country over the last two years because “there was a moment in time where it made sense,” but now home prices are too high, the business model has collapsed, and buyers evaporate.
By Tim Melvin: With stock markets flying near all-time highs, a recent article recommended tapping into home equity to purchase stocks. It listed three major points why this is a great idea. But it could be a horrible idea.
It starts here: evictions in San Francisco hit the highest level since 2001, when the dotcom bubble was disintegrating. Everything these days gets benchmarked against the last bubbles: the dotcom bubble that blew up in 2000, the housing bubble that blew up in 2007.
What Caused The Glorious Jump In Household Wealth (In One Insanely Good Chart) And Who Will Blow It Up Again?
The stock market has soared for five years, risks have ballooned, home prices have jumped. Gains built on the quicksand of endless liquidity and a lackluster economy. “Irrational exuberance” is back in the Fed's vocabulary. As the Fed’s Fisher said, it may end “in tears.”
By Aaron Layman: All US home builders are dealing with the same problem…affordability. They’re now seeing the consequences of the Fed’s Catch-22: depressed sales.
National averages paper over gritty details on the ground and are a crummy indicator as to what is happening in specific metro areas. But even with this caveat, a national average suddenly sounded an alarm for the housing market: the smart money is bailing out.
Teachers are a symbol of the middle class. In California, they earn on average $69,300 annually, fifth highest in the country. Not exactly a pittance. But it is a ludicrous pittance if they’re trying to buy a home.
First-time buyers, a powerful economic energy, create real demand and make the housing market grow. We’ve been praying for their arrival like we’ve been praying for rain in parched California. But the more we pray, the fewer there are.
OK, I get it. Life-threatening cold temperatures, polar vortices, and snow mayhem can put a damper on home construction, mortgage applications, first-time buyers, and home-builder confidence. But they also plunged on the West Coast where the weather was gorgeous.
“Foreclosure Rebound Pattern”: Foreclosures SUDDENLY Jump 57% in California (And Soar In Much Of The Country)
The cynic in me says the dizzying jump in foreclosure starts in January in much of the country, after years of sharp and consistent declines, must be some kind of data problem. Maybe RealtyTrac’s computers got hacked, or something. But that’s wishful thinking.