Applications for mortgages to purchase a house are 17% below last years level. They are 30% below levels in 2009/2010 during the depths of the recession. They are 12% below the level of 2012 when national home prices bottomed out.
The Case Shiller price index is up 25% from its low and is now back to mid-2008 levels. In mid-2008 mortgage applications to purchase homes were 100% higher than they are today. So we have mortgage applications dramatically lower since 2008, now at levels seen in 1997, but home prices have been driven 25% higher in the last two years. How could that be?
The chart below provides the reason. It’s certainly not growth in real household income, as that has plunged by 8% since 2008 and remains stagnant. Average hourly wages haven’t moved upwards in five years. How can people buy homes when their income is falling? They can’t.
The yellow line tells the story. Helicopter Ben and Bubbles Janet have printed fiat at a phenomenal rate and shoveled it into the troughs of their Wall Street owner pigs. The Wall Street shysters then created a fake housing shortage by withholding foreclosures from the housing inventory while buying up millions of homes in their own to rent scheme. Throw in the Chinese laundering their ill-gotten cash by buying up luxury real estate, and you’ve got a 25% increase in home prices.
Would a spineless, captured politician in Congress dare ask Bubbles Yellen about this immoral, criminal, treasonous act against the American people? Not a chance. So keep believing the economy is recovering, jobs are being created and the housing market is in great shape. The wealth of the oligarch pigs depends upon it.