Wednesday, March 25, 2009

Housing isn't just bad, it's really bad

As Zero Hedge has already discussed, last month's housing numbers are hardly something to cheer about. Nouriel & Co. are cautiously optimistic - not outright calling a bottom but definitely seeing a glimmer of hope.

The problem is the story that the numbers tell; the current purchase numbers are strongly driven by foreclosure sales (45%) and with the significant price drop in average home price(15% YoY), it's clear that it's a case of buyers trying to call the bottom and catch the proverbial falling knife. Much like the equity guys who got excited by every mini rally in the DJIA over the past year, this is far from even being close to showing signs of life. Sphere: Related Content
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10 comments:

James said...

Housing is a total joke. My parents live in a very high suburb in Chicago. Everything a million and up. Its like a bomb went off. Their house has been on the market for two years. Nothing moves

Anonymous said...

Do the banks have any idea about what is happening to their "legacy assets" while left unoccupied?

Lets just say they are falling into various states of disrepair.

Most homes that I visit have all of the copper wires and copper plumbing stripped out of them. Cabinets, appliances, and fixtures are stolen. Windows are broken, mold and bugs take up residency. Municiple code enforcement officers are writing violations by the 1000's.

"Legacy assets", come on. These are toxic assets to almost everyone but the bugs that live in them.

Lets get to the root of the Financial Crisis.

Maybe the reason why we had fewer financial crises in past is that we didn’t have co-ed trading floors. Women in the workplace has to END!

http://paul.kedrosky.com/archives/2009/03/the_case_for_si.html

Anonymous said...

There is a solution to the housing crisis:

It is called Section 8.

vsfv said...

You're right, it's all in the actual numbers. Our two cents went out today at:
http://www.viewfromsiliconvalley.com/id490.html

Peatey said...

Tyler, I think distinction needs to be made on housing activity and price. While I agree that existing home price bottom is nowhere close, those seeing a glimmer are looking for new home activity to help GDP.

Alex said...

Dude, prices didn't drop 15% in a month. They actually went up. The 15.5% drop you are quoting is a YOY number.

The data is in this link:

http://www.realtor.org/research/research/ehsdata

Anonymous said...

Yea good one Alex, dude.

Like I'm going to believe one shread of evidence form the NAR. Ha! Good one, dude. The gigs up on real estate "investments". I'd rather buy snake oil.

Cornelius said...

Noted - thanks Alex. My original source was a little poorly worded...

Edios said...

Does it matter whether or not inventory may be decreasing? I realize houses are selling at bargain basement prices. But people are out to buy, no? Even if they get 2 for 1, they're snatching them up. Who ever is foreclosing now can write off the loans, and have a less shady balance sheet.

Isn't that a good thing?

Anonymous said...

i'm in a house right now, and i like it. is something wrong?