The housing boom is being driven by Detroit, Las Vegas and Phoenix. Simply hysterical. You can get a 30 year mortgage for 3.25% with zero points, the FHA will guarantee any moron’s loan with 3.5% down, the Wall Street shysters are withholding millions of foreclosed properties from the market, and prices actually declined in 12 out of the 20 biggest markets in the country. Of course, when you spin it through some seasonally adjusted bullshit model, prices actually rose. The housing bulls, who never ask why something is happening, will continue to cheerlead and attempt to convince the ignorant masses to buy. One problem. The ignorant masses have run out of money and the Obamanistas have very little left of our money to give to the ignorant masses. So it goes.
Case-Shiller Posts 9th Consecutive Increase Driven By Phoenix, Detroit – Back To 2003 Levels, NSA Drops
As was expected, the October Case Shiller data showed that the recent transitory pick up in the housing sector, now that both REO-to-Rent and Foreclosure Stuffing, not to mention unparalleled debt forgiveness by virtually every bank has been thrown at the housing problem, continues with a ninth consecutive month in Top 20 Composite Index increases, rising 4.3% in October. On the other hand, based on the NSA data, the 4th consecutive dead cat bounce may be coming to a much expected end with October NSA data posting the first sequential decline since March. What drove the pick up in Seasonally Adjusted data? Nothing short of yet another housing bubble in the much beloved speculative areas such as Phoenix and Detroit, where home prices rose by 21.8% and… 9.9%. Yes: apparently one can pay for mortgages with foodstamps now.
Other places such as Chicago and New York were not so lucky, with the average price declining by -1.3% and -1.2% in the past 12 months. What remains unsaid – very much on purpose – is that the shadow inventory problem is only getting worse, as we reported a week ago, when we showed that nearly half the market cap of Bank of America is in 6 month + delinquent mortgages, or mortgages that are not yet in foreclosure but virtually certainly will be, and will also be discharged.
Why are banks stuffing foreclosure inventory from hitting the market? Simply: to create an indirect housing subsidiy, by removing inventory from the market. And with trillions in excess reserves sloshing on bank balance sheets, banks can for the time being, avoid any accounting of the lost cash flow and merely hope and pray that by delaying the avalanche of shadow inventory hitting the market, the price will rise enough to where millions of houses can once again be placed on the market quietly and efficiently. That this idiotic plan will blow up in the bankers’ faces (not to mention all those funds who jumped on the REO-to-Rent bandwagon) goes without saying, but for now the music is still playing so one must dance.
The recovery in context: back to 2003 levels.
youcanthavemyglock says:
I remember seeing houses in Detroit couple years back go for 1$…Of course they were in less than stellar neighborhoods, so I guess if they now go for 10$ that is perceived as housing recovery by MSM.
Well-loved. Like or Dislike:
8 
0
26th December 2012 at 10:28 am
DaveL says:
I have been telling you about the Phoenix market for almost a year now, There is lots of home building going on. Very little commercial. In fact, not only are the subdivisions that were started in the middle of the last decade getting fillled in, but there are a number of new land areas that are now breaking groung for more housing. See prices advertised from low 100′s to high 400′s. I think a lot are being bought with outside (the country) money. Lot of open space farmland here that is being farmed when not being sold off for houses.
Like or Dislike:
0 
0
26th December 2012 at 12:30 pm
IndenturedServant says:
“the Obamanistas have very little left of our money to give to the ignorant masses.”
Somehow I doubt that. According to Greenspan, that will never be a problem.
http://www.youtube.com/watch?v=gqUzQjXNliU
I_S
Like or Dislike:
0 
0
26th December 2012 at 2:29 pm
John Coster says:
About seven years ago, some friends of mine pooled resources and bought the old Peabody summer mansion in a nearby town. Twenty beautiful acres near 250 more acres of parkland, on a high hill with spectacular views of the Connecticut River Valley. The mansion was built in 1900, using fine stone masons who worked with materials quarried on the spot; it can comfortably house about fifteen people. There is also a garage with an apartment above it, a four bedroom carriage house and a an in ground pool (needs repair) with a pool side cottage, complete with bath and kitchen. About five years ago, the group fell apart and the remaining owner encountered big money problems. No one has paid the mortgage since. At one point, the “owner” made an offer of 560 K which the bank accepted, but he could not raise the cash. Several auction dates have been set and cancelled since. The owner and assorted characters are still there. By the way, there is a new train station at the bottom of the hill which soon will connect to New York and Boston. Of course, there may be complications due to the uncertainty of who actually owns the “note”. It’s a MERS property so the financing was sliced and diced by banksters.
BOA is handling it though so we know everything must be on the up and up. I suspect they are not foreclosing just so they can help support the artist who makes puppets in the big room that used to be used as a dining hall when nuns lived there.
By the way (for those of you who skeptical about the economic recovery), with a little cutting back of the encroaching forest, you would be able to see the approaching hoards, no matter what direction they might be coming from, and the stone construction of the lower levels gives the occupants good protection from anything but heavy ordinance. If you’re an aspiring warlord, this is a great opportunity, plus with all those south facing acres, you’ve got plenty a room to keep your serfs busy with your various crops and livestock.
Interested investors can email me at john.medicineb@gmail.com.
https://www.google.com/search?q=lupinwood&hl=en&safe=off&tbo=u&tbm=isch&source=univ&sa=X&ei=q17cUJuWFqWS0QHi_YHwAg&sqi=2&ved=0CEsQsAQ&biw=1517&bih=732
Like or Dislike:
1 
0
26th December 2012 at 9:54 am
MIlw05 says:
The houses which the banks are holding and not putting on the market are becoming slums. They make no attempt to maintain these homes, with the exception of grass cutting. The US, in a few years, will have to raze millions of homes nation wide. It is a looming disaster of which most have no idea of.
Drive around almost any neighborhood(good or bad) and you will see empty homes. The banks would have been better off having the ex owners becomes tenants or at least rent them out to others.
Another problems not reported. The army of metal strippers (scrappers) of vacant homes . It is an epidemic. This has become a profession for many losers and the damage they cause is extensive.
This foreclosure mess will take a generation to repair. I work in the condemnation business and have a good idea of the scope of the problem. It is much worse than most realize.
Like or Dislike:
3 
0
26th December 2012 at 5:18 pm
ThePessimisticChemist says:
@Mllw05 –
The banks usually refuse to admit that they’ve let the property get looted, and want all repairs to come out of the pocket of a potential buyer.
Not surprisingly, people aren’t exactly jumping at these “deals.”
Like or Dislike:
3 
0
26th December 2012 at 5:28 pm