These charts never grow old whenever you want to reveal the truth about the “healthy” market driven housing recovery touted by the moronic media, the Wall Street shysters and the national association of lying realtors. Shockingly, mortgage applications to purchase a home FELL again last week.
Mortgage rates have been falling for the last 14 straight months to a new low of 4.25% for a 30 Year Mortgage. According to the MSM and the government we’ve been adding jobs at a rapid clip for the last year. Obama tells me we’ve added 10 million jobs since he assumed command. The stock market is at all-time highs. It sure sounds like everything is coming up roses. Ask yourself a couple questions.
Why are mortgage applications to purchase a home down 12% versus one year ago?
Why are they lower than they were in 2010 at the recession lows?
Why are they at 1997 levels, well before the housing boom took hold?
How could home prices rise by 25% since 2012 even though mortgage applications have plunged?
How could mortgage applications be 65% BELOW 2007 levels when mortgage rates were 6.7%?
There were 272 million Americans living in 101 million households in 1997. Today, there are 320 million Americans living in 122 million households. But mortgage applications to buy a house are at the same level as 1997. And this is what is being touted as a housing recovery? You’d have to be asleep or brain dead to believe it. Check out CNBC for proof.
All of the freed up money from refinancing over the last five years, which created additional spending by delusional consumers, is history. Refinancing applications are DOWN 73% from the last gasp in May 2013. Anyone who doesn’t have a mortgage rate below 5% is either a fool or a tool.
The answer to all of the questions above is:
COLLUSION BETWEEN THE FEDERAL RESERVE, THE WALL STREET BANKS, AND YOUR FEDERAL GOVERNMENT.
As i was saying on the Canary in the Coalmine thread.
SISO
I cannot think of ANY economic reporting that holds actual meaning anymore.
10% more, 6% less, increased, decreased, without a quantifier all these terms mean nothing. I call it Specific Vagueness. (trick used to garner the best salary from a company, or the lowest starting salary for a company)
You have to peer beyond the MSM headline/20 second story to find truth. Then you have to add some common sense too.
The Great and Powerful O gifted the banksters billions to buy up the homes they foreclosed on. They funneled the money directly to their crony “developers” that then went out and bought up the turn key entry level housing, thus keeping it unaffordable for the masses that have jobs, the banks helped out by denying, or not even accepting, applications from people to buy the homes. It seems that every “real estate saving” plan took homes/money from citizens and gifted it to the bankers. People are understandably giving up – as evidenced by the applications – and O’s cash is drying up on his repo program. The developers have learned that unless the homes are Section 8 ready, there aren’t many renters available making the kind of cash to pay mortgage-value payments every month. This portion of the pretend and extend game is reaching its end.
Meanwhile cities have been siphoning billions of inflated commercial tax values on these properties. If they all revert to homestead, the cities stand to lose lots and lots of tax revenue. Cue the next round of budget woes and “devastating” cuts to their bloated pensions and insurance plans, which still won’t fix a freaking thing, just kick the can again. If there is enough left of the can to do it.
Between the number of units and applications falling, the reality of commercial/rental vs. homeowner tax rates, the need for printed cash for Wall Street, and the fact that the gubment is spending much more than they are collecting, it should be obvious.
Sometime after the elections, maybe even after the disastrous results of the illegals and upcoming mandated increases in utility/energy hit us (so 2Q15?), you watch and see one more hail Mary coming out of the FR and CONgress to “save” the banksters/stock market. Another trillion, or ten, funneled to our overlords to “save” the common man while insuring our destruction. Then shit will really get interesting.
Until then our entire way of live is contingent on China continuing to send us their production in return for our fiat. As long as that holds, we will just continue struggling from one gubment created disaster to another, which may, or may not, include all out war until our systems start crashing and burning. I’m expecting a domino effect where one piece falls (like the pension effect of a stock market crash), which will lead to another crash, and another, and another, as we sit back and watch our way of life and belief systems implode right along with them.
It is going to take a miracle, or a hundred, for these farces to continue on another generation.
I believe in miracles. I just don’t trust the odds.
Greetings,
The problem, as I see it, is that there are areas of ridiculousness where houses still can command obscene amounts of money. I live in a beach community between Malibu and Santa Barbara and a shack in our town goes for half a million or more. My friends recently listed their 800sqft home that sits next to a drug dealer and a block away from a rub & tug for 680k. They were (are) in shock that the house hasn’t sold even though it has only been on the market for two weeks.
Because there are a few islands like this, they tout it about like the whole country is doing as well as we are. It is a lie, just one big lie.
Well TE, what is your only option when you’re down to a couple pawns and your opponent still has a queen? Flip the board over and deny that you were beaten. Up until a few years ago we all were so smug thinking we had figured out the endgame to this financial chess match. Pay off debt and buy junior miners. But needless to say many have underestimated the ends to which they will take this thing to maintain the current paradigm. Today there is a big story by the Federal Reserve saying Americans are “hoarding cash.” We have already seen the language shift from saving being a good thing, to saving being a bad thing, and now saving will be labeled a criminal thing. The worst two years are ahead, the midterms are the last speed bump on the speedway to slavery.
Everywhere I read about how cash-strapped Americans are. That they can’t even go to McShits or Walmart. That a huge percentage have little to no savings. That consumer debt is increasing and debt collectors are getting rich.
So, when the Fed says Americans are hoarding cash … I’m just not sure WTF they’re talking about … unless they mean the rich and very rich.
Tumble…saving is bad has been the mantra of Keynesians for a couple of generations now . Bet on brother has been the slogan,remember Bush said after 9/11…if we don’t spend the terrorists win !
So . . . the massive number of unemployed people, and the people working one or more part-time minimum-wage McJobs aren’t buying houses?
Shocking.
Maybe more subprime mortgages would work. Look what subprime auto loans are doing:
U.S. auto sales reach highest level in nine years
By Steve Goldstein
Published: Sept 3, 2014 3:18 p.m. ET
WASHINGTON (MarketWatch) — Light vehicle sales rose to a seasonally adjusted annual rate of 17.53 million in August, up from 16.48 million in July and the best level since July 2005, according to data compiled by Autodata. Economists polled by MarketWatch had forecast a 16.6 million level. The gains were driven by a 7% gain for trucks, on declining fuel prices and increased construction activity. Car sales also improved.
D.R. Horton profit hurt by weak Chicago market
By Anna Prior
Published: July 24, 2014 7:58 a.m. ET
D.R. Horton Inc. said its fiscal third-quarter profit fell despite strong home-building revenue and an increase in new sales orders, as the home builder recorded impairment charges tied to assets in the Chicago area.
The Chicago housing market remains weak, with sales absorptions and returns in these communities performing below management’s expectations, the company said. During the quarter, D.R. Horton took actions to increase sales pace, reduce inventories and improve cash flows in those communities, which results in a $54.7 million impairment charge during the quarter, the company added.
D.R. Horton, one of the nation’s largest home-building companies, has long been a favorite with industry analysts because its management team avoids risk and it constructs low-price homes accessible to many buyers.
In the latest quarter, D.R. Horton reported earnings of $113.1 million, or 32 cents a share, down from $146 million, or 42 cents a share, a year earlier. The latest quarter’s results included the inventory impairment charges, primarily related to active communities in the Midwest region in Chicago that were purchased from 2004 to 2007 and had been previously impaired.
Home-building revenue climbed 28% to $2.10 billion. Net sales orders increased 32% in value to $2.4 billion and 25% in homes to 8,551.
Analysts polled by Thomson Reuters had expected earnings of 49 cents a share on revenue of $2.09 billion.
For the quarter, D.R. Horton said home closings rose 28% in value to $2.1 billion, while the number of homes closed climbed 19% to 7,676.
The company also said its board has increased its quarterly cash dividend by 67% to 6.25 cents a share.
PulteGroup orders Fall
By Anna Prior
Published: July 24, 2014 7:23 a.m. ET
PulteGroup Inc. said its second-quarter earnings improved as the home builder reported slightly higher revenue boosted by higher average selling prices.
However, Pulte’s new orders fell 2.2% from a year earlier to 4,778 homes, though the value of net new orders for the period increased 5% to $1.6 billion. Closings, meanwhile, fell 9%.
As one of the nation’s largest builders, Pulte’s sales are typically considered to be a strong barometer for the sector because the company constructs everything from entry-level homes to units for retirees nationwide.
Builders have also benefited from a low supply of existing-home inventory in recent periods, although recent data was weaker than expected. Housing starts sank a seasonally adjusted 9.3% in June amid wet weather in the South, while residential housing permits, an indicator of future construction plans, were down 4.2%, according to the Commerce Department. Analysts, however, had indicated that June’s results were likely a temporary departure from a trend of recovery in the housing market.
“Our view of the U.S. housing market remains positive, as improvements in both the economy and employment provide ongoing support to an industry already benefiting from low inventory, low mortgage rates, better pricing and favorable demographic trends, said Richard J. Dugas Jr., PulteGroup chairman and chief executive.
Overall, Pulte reported a profit of $41.9 million, or 11 cents a share, up from $36.4 million, or nine cents a share, a year earlier. The latest quarter’s results included income tax expense of $26 million–compared with prior-year income tax expense of $2 million–as well as $88 million charges tied to insurance reserves and office relocation costs. The year-ago quarter included $67 million of charges resulting from a contractual dispute, debt repurchases and corporate relocation.
Total revenue edged up 0.5% to $1.29 billion.
Analysts polled by Thomson Reuters had predicted earnings of 25 cents a share on revenue of $1.33 billion.
Home-building cost of revenue fell 5.1%. Home-sale gross margin rose 480 basis points to 23.6%. The average selling price rose 12% to $328,000.
PulteGroup Inc. said its second-quarter earnings improved as the home builder reported slightly higher revenue boosted by higher average selling prices.
However, Pulte’s new orders fell 2.2% from a year earlier to 4,778 homes, though the value of net new orders for the period increased 5% to $1.6 billion. Closings, meanwhile, fell 9%. -admin
Seems like a wash without soap.
Hovnanian Orders Decrease
For the third quarter ended July 31, 2014, the number of consolidated net contracts decreased 6.3% to 1,357 homes compared with 1,448 homes in last year’s third quarter. The number of net contracts, including unconsolidated joint ventures, decreased 9.2% to 1,424 homes during the third quarter of fiscal 2014 from 1,568 homes in the same period of the prior year.