home prices – Page 3 – The Burning Platform

RENTERS R US

About that housing recovery. The U.S. population has grown by 8% since 2005, while the number of households has grown by 5%. In addition to the weak overall household growth, due to stagnant wages, massive student loan debt, and only Obama shit service jobs, there have been no new owner occupied households. The number of owner occupied households is down 1%, while the number of rental households has soared by 16%.

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The home ownership rate is now at a two decade low and sits at the same level it did in 1970, before Nixon closed the gold window and unleashed a debt and inflation tsunami upon our nation. The Federal Reserve solution to every bubble they create is to print enough to create another bubble. They have expanded their balance sheet by almost 600% since 2008, and have succeeded in crushing the middle class, senior citizens, and young people who should be buying their first homes.

Continue reading “RENTERS R US”

MILLENNIALS: “I’M BACK!!!!”

So the government puts out a report showing that 50% of 25 year olds are living with their parents in our supposedly booming economy. They blather about how this is a real problem when it is the Federal government that has wrapped them in the chains of $1 trillion of student loan debt in the forlorn hope there would be good jobs waiting for them after getting that degree in psychology. If the unemployment is really 5.6%, how come they can’t get jobs?

The report (from the Fed) says it’s a problem that the “hot” housing market has kept millennials from buying homes. That’s a good one. The Fed and their Wall Street scum owners, along with the Fedgov agencies (Fannie & Freddie), have manufactured the “hot” housing market to artificially pump up prices to fix the insolvent balance sheets of the Wall Street banks. Mortgage applications are mired at 1998 levels because hedge funds, flippers, and Chinese billionaires have been encouraged by the Fed to pile in and pump up prices.

It’s despicable how the Fed and Bloomberg write this drivel and don’t address the true reasons millennials have been fucked over by the system they created and support.

Via Bloomberg

The Simple Reason Millennials Aren’t Moving Out Of Their Parents’ Homes: They’re Crushed By Debt

Millennials are not budging from their parents’ basements, even though the job market is on the mend. One really big reason? Student loans.Last year, the rate of 25- to 34-year-olds living at home rose to 17.7 percent among men and 11.7 percent for women, Census data showed last week. That is a record high for both genders. Continue reading

CANADIAN HOUSING MARKET ABOUT TO GO KABOOM, EH

Guest Post by Dr. Housing Bubble

The Canadian housing bubble makes California real estate look sensible: Crash in energy prices will put pressure on home values up north as Canadians go into maximum leverage.

As the year comes to a close, it is useful to put things into perspective. Sure, California has a love affair with real estate and we go through our traditional booms and busts. $700,000 crap shacks now litter the landscape but there are fewer and fewer lemmings taking the plunge. In Canada there was no correction. In fact, households continue to go into deep debt to purchase real estate. The argument goes that mortgage standards are much tighter in Canada so therefore, they are much more enlightened when it comes to financing homes. People forget that the bulk of the 7,000,000 foreclosures in the US came in the form of standard loans. Garbage loans imploded in more dramatic fashion but people lost their homes because the economy shifted. At that point, it merely meant covering the monthly nut. We were housing dependent and that market contracted aggressively. Canada is housing and oil dependent. And oil just got a big kick to the shins.

In Canadian debt we trust

There was an inflexion point for US markets when household debt surpassed household income. People kept saying it was a liquidity crisis initially but it was truly a solvency crisis. People took on too much debt and were walking on a financial tightrope. In the US, this peaked above 120 percent. Canada is well on its way above 160 percent:

Basically Canadians are deeper in debt relative to their income. And a large part of this debt is housing related. A large part of the economy is also tied to oil and as you may know, oil just took a massive cut:

It was interesting to hear that we would never see oil drop below $100 a barrel. Oil is now trading at $52.84 a barrel. Similar arguments were made about US housing never having one negative year-over-year price drop until we did.

Large part of Canada’s oil is costly to extract

A large portion of Canada’s oil is costly to extract. With oil sands for example oil would need to be at $80 a barrel to make a profit:

Continue reading “CANADIAN HOUSING MARKET ABOUT TO GO KABOOM, EH”

WALL STREET HEDGE FUNDS FLEE HOUSING MARKET

Yes, the housing recovery storyline keeps being pushed back month after month. Existing home sales plunged by 6.1% in one month. Existing home sales are 8% LOWER than they were in July of 2013. Does that happen in a recovery? Sales of existing homes were up 2% over last year, but the distribution of sales tells the real story. Homes selling for less than $100k crashed by 16%. Homes selling between $100k and $250k fell by 1%. These two categories account for 61% of all home sales.

The NAR touts the fact that home prices were 5% higher than last year. What they did not tell you is that home prices have fallen for the 5th month in a row and are now 7.5% LOWER than they were in June. Is that a sign of a housing recovery?

Good old Larry Yun, the latest NAR shill who will write a book after he leaves about how it was his job to lie, assures us this is just a one month aberration caused by the stock market going down for a few days in October. Everyone knows that you make a home purchase decision based upon the day to day fluctuations in the stock market. So this douchebag blames the plunge in home sales on the stock market. Let’s test his hypothesis.

Dow on Oct 1 – 16,801

Dow on Oct 31 – 17,390

Dow on Dec 1 – 17,776

So the Dow was up about 1,000 points in October and November and this pitiful excuse for a human being blames the housing plunge on the stock market?

Here is the facts jack. Blackrock and the rest of the Wall shysters see the writing on the wall. Their master plan to drive prices higher with free money from the Fed worked to perfection. The investors and flippers are exiting stage left. At one point cash sales reached 36% of all transactions. It has plunged to 25% of all transactions as Wall Street sells before the flippers and average people left holding the bag. It’s no coincidence prices are falling. The fake housing recovery is over. Sales and prices will continue to fall.

Real people have lower real wages than they did at the depths of the recess ion in 2009. Fannie and Freddie are attempting to use your tax dollars to create another subprime mortgage bubble, but it’s too late. The recession is under way and housing is headed back into the toilet. I wonder what Larry Yun will do when he resigns from the NAR in disgrace like David Lereah?

Existing Home Sales Collapse Most Since July 2010, Downtick In Stock Market Blamed

Submitted by Tyler Durden on 12/22/2014 10:08 -0500

Having exuberantly reached its highest level since September 2013 last month (despite the total collapse in mortgage applications), it appears the ugly reality of the housing market has peeked its head out once again. As prices rose, existing home sales plunged 6.1% – the most since July 2010 (against an expected 1.1% drop) to 4.93mm SAAR (the lowest in 6 months).

So what was it this time: the polar vortex, the crude collapse, the crude vortex? Neither: According to the NAR’s endlessly amusing Larry Yun, this time it was the stock market:

“The stock market swings in October may have impacted some consumers’ psyche and therefore led to fewer November closings. Furthermore, rising home values are causing more investors to retreat from the market.”

Supposedly he is referring to the tumble, not the resulting Bullard “QE4” mega-explosion in stocks that pushed everyhting to new all time highs.

In other words, according to the NAR, even the tiniest downtick in stocks, and the housing market gets it.

Sure enough, it is time to boost confidence in a rigged, manipulated ponzi scheme:

DROP IN NOVEMBER COULD BE ONE-MONTH ‘ABERRATION,” YUN SAYS

Unless, of course, stocks drop again, in which case all bets are off.

Meanwhile, it appears investors have left the building…

Every part of America saw a collapse:

November existing-home sales in the Northeast declined 4.2 percent to an annual rate of 680,000, but are still 4.6 percent above a year ago. The median price in the Northeast was $246,100, which is 1.3 percent above a year ago.

In the Midwest, existing-home sales fell 8.9 percent to an annual level of 1.13 million in November, and are now 1.7 percent below November 2013. The median price in the Midwest was $160,500, up 7.0 percent from a year ago.

Existing-home sales in the South decreased 3.2 percent to an annual rate of 2.09 million in November, but remain 5.0 percent above November 2013. The median price in the South was $176,500, up 5.2 percent from a year ago.

Existing-home sales in the West dropped 9.6 percent to an annual rate of 1.03 million in November, and remain 1.0 percent below a year ago. The median price in the West was $292,700, which is 3.5 percent above November 2013.

Some more amusing details from the report:

The median existing-home price2 for all housing types in November was $205,300, which is 5.0 percent above November 2013. This marks the 33rd consecutive month of year-over-year price gains.

Total housing inventory3 at the end of November fell 6.7 percent to 2.09 million existing homes available for sale, which represents a 5.1-month supply at the current sales pace – unchanged from last month. Despite the tightening in supply, unsold inventory remains 2.0 percent higher than a year ago, when there were 2.05 million existing homes available for sale.

“Lagging homebuilding activity continues to hamstring overall housing supply and is still too low in relation to this year’s promising job growth,” says Yun. “Much faster price and rent appreciation – easily exceeding wage growth – will occur next year unless new construction picks up measurably.”

All-cash sales were 25 percent of transactions in November, down from 27 percent in October and 32 percent in November of last year.

Individual investors, who account for many cash sales, purchased 15 percent of homes in November, unchanged from last month and below November 2013 (19 percent). Sixty-one percent of investors paid cash in November.

The percent share of first-time buyers in November climbed to 31 percent, up from October (29 percent) and is the highest share since October 2012 (also 31 percent). First-time buyers have represented an average of 29 percent of buyers through November of this year.

Distressed sales – foreclosures and short sales – were unchanged in November from October (9 percent) and remained in the single digits for the fourth month this year; they were 14 percent a year ago. Six percent of November sales were foreclosures and 3 percent were short sales. Foreclosures sold for an average discount of 17 percent below market value in November (15 percent in October), while short sales were discounted 13 percent (10 percent in October).

Properties typically stayed on the market in November longer (65 days) than last month (63 days) and a year ago (56 days). Short sales were on the market the longest at a median of 116 days in November, while foreclosures sold in 65 days and non-distressed homes took 63 days. Thirty-two percent of homes sold in November were on the market for less than a month.

But don’t worry about all that: the NAR couldn’t be happier that just like in the last housing bubble, so too now Fannie and Freddie’s new 3% down payment initiative, means the bubble is about to get bigger than ever:

NAR President Chris Polychron, executive broker with 1st Choice Realty in Hot Springs, Ark., says Fannie Mae and Freddie Mac’s new low downpayment program should improve access to credit for responsible buyers. “NAR applauds Fannie and Freddie’s commitment to homeownership by serving creditworthy borrowers who lack the resources for substantial downpayments plus closing costs with its new downpayment program,” he said. “The new program mitigates risk with strong underwriting and ensures that responsible buyers have access to safe and affordable mortgage credit. Furthermore, NAR believes lenders must do their part to ensure loans are prudently underwritten and are made available to qualified borrowers.”

And since the taxpayers will be left to bail out the excesses of this latest incipient housing bubble, what’s not to like?

But the punchline: the median price of existing homes dropped to $205,300…

… because, well, there is a “lack of supply.”

Nov existing home sales fell 6.1% to 4.93M-the lowest level since last May (4.91M). Lack of supply continues to weigh on the #housing market

yep – that must be it…

BE VEWWY QUIET, I’M HUNTING BUBBLES

ACTUAL PICTURE OF FEDERAL RESERVE VICE CHAIRMAN STANLEY FISCHER HUNTING BUBBLES

Guest Post by Anthony Sanders

Fed’s Fischer Leads Committee Watching for Asset-Price Bubbles (Here Are Bubbles To Watch, Stan!)

The Federal Reserve’s Stanley Fischer is now leading a committee to watch for asset bubbles. Fed officials want to ensure that six years of near-zero interest rates don’t lead to a repeat of the excessive risk-taking that fanned the U.S. housing boom and subsequent financial crisis.

Let me help you out, Stan!

Here is a chart of the S&P 500 stock market index against The Fed’s Balance Sheet to proxy for near-zero interest rates. Yes, it looks a bubble to me!

Here is a chart of average hourly wage earnings growth YoY against The Fed’s Balance Sheet. No bubble in wages.

Similarly, there is no bubble in real median household income since The Fed’s massive intervention. Quite the opposite, in fact.

How about home prices? Yes, there appears to be a bubble in home prices since 2012 given the poor growth in wage earnings.

Gold? Gold was soaring until 2011 with the growth in The Fed’s Balance Sheet, but has been declining/stagnant since then. So, no current bubble.

There you go Stan! Home prices and equity markets are in a bubble (thanks to NO bubble in wages and earnings). And no current gold bubble either. It’s hard to sustain housing and stock market bubbles with stagnant wage earnings and household income.

So I would watch the equity markets and home prices for excessive risk taking by wealthy investors.

Stanley Fischer with “Orange Lady” Christine Lagarde from the International Monetary Fund (IMF) looking for asset bubbles over coffee. And apparently Lagrade has been promoted to General in the Global Monetary Army.

HOUSING RECOVERY MY FAT ASS

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.

RIDICULOUS HOUSING PROPAGANDA FROM NAR & MSM

I’ve told myself to not even look at the highly manipulated statistical drivel put out by the government, corrupt organizations, and regurgitated and spun in a positive manner by the captured corporate media. Just when I thought I was out, they pull me back in.

I see Marketwatch with this blaring headline:

Existing-home sales rise 2.4% in July

They are breathlessly describing how this was better than expected, as if it proves we are in a housing recovery. Existing home sales always rise in July versus June because people need to move before school starts. This is a meaningless data point. The important data point is how it compares with the prior July. That is buried deep in the NAR press release.

Surprise, Surprise. Existing home sales FELL by 4.3% versus July of last year. That means the housing market is in decline.

Of course the scumbags at the NAR touted the 4.9% price increase over last July. They use annual data when it suits them.

What they did not report is that home prices FELL between June and July from $223,300 to $222,900. They have been falling for months. Housing inventory grew by 3.5% over June and by 5.8% over last July. So you have declining sales and rising inventory on a year over year basis. That sure sounds like a recovery to me.

Investors still account for 29% of all sales, but that percentage is declining. The hedge funds are exiting and the flippers are panicking. Wait until prices fall another 5%. The rush for the exits will be on. First time buyers are still near historic long-term lows and will remain there for years.

Yes the MSM and the NAR are actually cheering for negative year over year sales results that put existing home sales at 1999 levels. Yippee. Let’s buy the all-time fucking high in the stock market.

THIS IS YOUR RECOVERY AND THIS IS YOUR RECOVERY WITHOUT DRUGS

“If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks…will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered…. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs.” – Thomas Jefferson

Does this chart portray an economic recovery in any way? Wages have been stagnant since the START of the supposed recovery in 2010. Real median household income, even using the highly understated CPI, is on a glide path to oblivion. You just need to observe with your own two eyes the number of Space Available signs in front of office buildings, strip centers and malls across America to realize we have further to fall. Low paying, part-time burger flipping jobs aren’t going to revive this debt saturated economic system. But at least the .1% are enjoying their Federal Reserve created high. Fiat is a powerful drug when administered in large doses to addicts on Wall Street.

The S&P 500 has risen from 666 in March of 2009 to 1,972 today. That is a 196% increase in a little over five years. During this same time, real household income has fallen by 7%. There have been a few million jobs added, while 11 million people have left the labor market. According to Robert Shiller’s CAPE ratio, the stock market valuation has only been higher, three times in history – 1929, 1999, and 2007. He seems flabbergasted by why valuations are so high. Sometimes really smart people can act really dumb.

The Federal Reserve balance sheet was $900 billion before the 2008 financial crisis. Today it stands at $4.4 trillion. The Fed has increased their balance sheet by 220% since the March 2009 market lows. Do you think there is any correlation between the Fed puppets printing $2.4 trillion and handing it to their Wall Street puppeteers, who used their high frequency trading supercomputers and ability to rig the markets so they never lose, and the third stock bubble in the last 13 years? It’s so self evident that only an Ivy League economist or CNBC anchor wouldn’t be able to see it.

Let’s look at the amazing stock market recovery without Federal Reserve heroine pumped into the veins of Wall Street banker addicts. If you divide the S&P 500 Index by the size of the Federal reserve balance sheet, you see the true purpose of QE1, QE2, and QE3. It wasn’t to save Main Street. It was to save Wall Street. Without the Federal Reserve funneling fiat to the .1% banking cabal and creating inflation in energy, food, and other basic necessities for the 99.9%, there is no stock market recovery. The recovery has occurred in Manhattan and the Hamptons. It’s been non-existent for the vast majority of people in this country. The wealth effect and trickle down theory have been disproved in spades. The only thing trickling down on the former middle class from the Fed is warm and yellow.

The entire stock market advance has been created on record low trading volumes and record high levels of monetary manipulation. Even though the Federal Reserve has driven senior citizens further into poverty with 0% interest rates, those with common sense have refused to be lured back into the lion’s den. They have parked record levels of fiat in no interest bank and money market accounts. They are tired of being muppets led to slaughter.

Quantitative easing was supposed to force little old ladies into the stock market and consumers to spend their debased dollars before they lost more value. The spending would revive the dormant economy just as the Keynesian text books promised. It didn’t happen. The peasants haven’t cooperated. Quantitative easing and ZIRP sapped the life from the middle class as their wages have stagnated and their living expenses have skyrocketed. Mission Accomplished by the Fed. Of course, the CNBC bimbos and shills would declare this $10.8 trillion to be money on the sidelines ready to boost the stock market ever higher. I love that storyline. It never grows old.

The MSM, government and Wall Street continue to flog the story about a housing recovery. It’s been nothing but a confidence game based upon the Fed’s easy money and the Wall Street scheme to buy up foreclosed properties with the Fed’s money. The scheme was to artificially boost home prices by restricting home supply through foreclosure manipulation, in order to allow the insolvent Wall Street banks to get out from under their billions in toxic mortgage loans.

Shockingly, the Case Shiller home price index has soared by 25% since 2012 despite first time home buyers being virtually non-existent and mortgage applications plunging to 14 year lows. How could that be? Don’t people need mortgages to buy houses? Isn’t real demand necessary to drive prices higher? Not when Uncle Ben and Madam Yellen are in charge of the printing press. Housing bubble 2.0 has arrived. I wonder if the Federal Reserve balance sheet increase of 50% since 2012 has anything to do with the new housing bubble.

It seems a similar result is obtained when dividing the Case Shiller Index by the size of the Fed’s balance sheet. The real housing market for real people is worse than it was in 2009. The national home price increase has been centered in the usual speculative markets, aided and abetted by the Fed’s easy money, managed by the Wall Street hedge funds, and exacerbated by the late arriving flippers who will be left holding the bag again. The Fed/ Wall Street scheme has priced young people out of the market and has failed to ignite the desired Keynesian impact. Investors/flippers account for 34% of all home sales. Foreigners with no knowledge of value metrics account for 30% of all home sales. The lesson of history is that most people don’t learn the lessons of history. The 2nd housing bubble in seven years is seeking a pin.

If ever you needed proof of the confidence game in its full glory, the chart below from Zero Hedge says it all. Mortgage rates have been falling for the past year, home builders have been reporting soaring confidence about the future, and the National Association of Realtors keeps predicting a surge in home buying any minute now. One small problem. Mortgage applications are in free fall, new home sales are at 1991 levels, and existing home sales are falling. Home prices have peaked and are beginning to roll over. The Wall Street hedgies are all looking to exit stage left. Young people are saddled with over a trillion of government issued student loan debt and millions of older subprime borrowers have been lured into more auto loan debt. Home sales will be stagnant for the next decade.

Quantitative easing will cease come October, unless Yellen and Wall Street can create a new “crisis” to cure with more money printing. By every valuation measure used over the last 100 years, stocks are overvalued by at least 50%. By historical measures, home prices are overvalued by at least 30%. Ten year Treasuries are yielding 2.4%, while true inflation is north of 5%. With real interest rates deep in negative territory, the bond market is even more overvalued than stocks or houses. These simultaneous bubbles have been created by the Federal Reserve in a desperate attempt to keep this debt laden ship afloat. Their solution to a ship listing from too much debt was to load it down with trillions more in debt. The ship is taking on water rapidly.

We had a choice. We could have bitten the bullet in 2008 and accepted the consequences of decades of decadence, frivolity, materialism, delusion and debt accumulation. A steep sharp depression which would have purged the system of debt and punishment of those who created the disaster would have ensued. The masses would have suffered, but the rich and powerful bankers would have suffered the most. Today, the economy would be revived, saving and investing would be generating needed capital for expansion, and banks would be doing what they are supposed to do – lending money to businesses and individuals. Instead, the Wall Street bankers won the battle and continue to pillage and loot the national wealth while impoverishing the masses.

The arrogance, hubris and contempt for morality displayed by the ruling class is breathtaking to behold. They think they are untouchable and impervious to norms followed by the rest of society. They may have won the opening battle, but will lose the war. Discontent among the masses grows by the day. The critical thinking citizens are growing restless and angry. They are beginning to grasp the true enemy. The system has been captured by a few malevolent men. When the stock, bond and housing bubbles all implode simultaneously, all hell will break loose in this country. It will make Ferguson, Missouri look like a walk in the park. I wonder if the occupants of the Eccles building in Washington DC will get out alive.

“It is well enough that people of the nation do not understand our banking and money system, for if they did, I believe there would be a revolution before tomorrow morning.” – Henry Ford

Charts provided by Confounded Interest

LARGEST MORTGAGE LENDER IN THE WORLD HAS A 58% PLUNGE IN MORTGAGE ORIGINATIONS

The MSM was certainly quiet about Wells Fargo’s shitty 2nd quarter results where they saw revenue fall, while using accounting entries to relieve loan loss reserves to generate a fraudulent miniscule profit. Wells Fargo is the largest mortgage lender in the world. The number of mortgage originations crashed by 58% versus last year. A critical thinking individual might ask how we could be experiencing a strong housing recovery with skyrocketing price appreciation if the largest mortgage lender in the world is experiencing a crash in their mortgage lending business, with a 39% decline in mortgage banking income. Luckily, there are few critical thinking people in the country and none in the captured mainstream media who are touting these shitty results as solid.

It’s amazing how much profit you can generate with accounting entries. The brilliant CEO of Wells Fargo reduced his provision for future losses by $435 million versus last year, therefore generating the standard EPS beat required by the Wall Street shysters. The economy is currently in recession, subprime auto loans are beginning to go bad, the housing recovery fraud will lead to future mortgage losses, and student loan debt is a ticking time bomb. So Wells Fargo dramatically reduces the amount set aside for bad debt losses. Just like they were doing in 2007.

They are also desperately trying to sell their student loan portfolio before it becomes an exploding cigar in their faces. I’m sure Obama and his minions will pay top dollar to acquire that subprime slime. The brilliant bankers at Wells Fargo increased auto loans by 11% as everyone knows consumers with less and less household income are great credit risks. If you can fog a mirror, you can get a 7 year auto loan. What could possibly go wrong?

Even the criminal banking cabal can no longer crank out fraudulent profits to prop up their stock prices. This little game of extend, pretend and defend their criminal acts and fraudulent accounting is growing long in the tooth. The collapse is coming. You will not be warned. It will happen over a weekend. On Monday they will have changed the rules. You will be the loser. Take your money out of the banks.

WALL STREET & THE CHINESE GOV’T ACCOUNT FOR ALL THE CASH PURCHASES OF HOUSES

As the mainstream corporate media, controlled by Wall Street and the government, continues to spout off about a housing recovery, the data proves that average people are NOT buying homes. Average real people must get a mortgage when they buy a home. Mortgage applications are at 15 year lows and going lower. The talking heads and mouthpieces for the oligarchy conveniently ignore this FACT as they generate their feel good propaganda and publish on-line and in their newspapers.

The number of cash purchases of homes is at a record high. As detailed previously, a huge chunk of these purchases are by Blackrock and the other Wall Street shyster firms as they attempt to drive prices higher and relieve the insolvent balance sheets of the Too Big To Trust Wall Street Cabal. Their buy and rent scheme was developed in conjunction with the Federal Reserve and the U.S. Treasury Dept. Bernanke, Yellen, Geithner, Lew, and Obama have conspired with Dimon, Fink, Blankfein and the rest of the Wall Street criminals to keep young people from ever purchasing a home at a fair price.

The other piece of the cash buying puzzle is detailed below by Mike Krieger. The Chinese central authorities have surpassed even the Federal Reserve in blowing epic bubbles with their easy money cronyism. They have blown an epic real estate bubble in China that is in the process of bursting. The hoard of government connected millionaires and billionaires in China have switched their sights to the U.S., just as the Japanese did in the late 1980’s. We all know how well that worked out for the Japanese.

These Chinese buyers are temporarily rich and they are stupid. They do not care about value. They are just attempting to convert their ill-gotten cash into hard assets. They don’t care about price. The result is that prices, especially on the West Coast, have been driven higher. All the price statistics put out by the NAR, Case Shiller, and the Census Bureau are worthless in assessing the true health of the housing market. The entire “recovery” is a government created fraud.

This central bank created bubble will end just as all their previous bubbles have ended – with tears and wealth destruction on an epic scale. Meanwhile, the well connected cronies on Wall Street and in Beijing utilize the free money to enrich themselves and impoverish savers, the young, and anyone foolish enough to purchase at these prices. So it goes.

Via Mike Krieger

Chinese Purchases of U.S. Real Estate Jump 72% as The Bank of China Facilitates Money Laundering

Michael Krieger | Posted Wednesday Jul 9, 2014 at 12:09 pm

American citizens already have a hard enough time affording a home. Squeezed out by financial oligarchs buying tens of thousands of properties for rental income, and faced with real wages that haven’t budged since the mid-1970s, the demographic of U.S. citizens that historically dominated the new home market has been forced to live in their parents’ basements. Just to kick em’ when they’re down, Americans now face the impossible task of competing with laundered Chinese money.

Of course, this isn’t a new trend. I first covered it in January 2013 in the post: Corrupt Chinese Politicians are Buying Billions in U.S. Real Estate. This was then followed up a couple of months ago in the piece: Zillow Opens the Floodgates to Chinese Buyers in Order to Keep Housing Bubble 2.0 Inflated.

While this trend may not be new, it is certainly accelerating. According to the National Association of Realtors in its annual report on foreign home purchases, transactions from Greater China (includes Hong Kong and Taiwan) were up 72% in the past year to $22 billion. In some California communities, 90% of real estate buyers are from China. Yes, 90%. Naturally, many of them are buying multi-million dollar homes in “all cash” transactions.

Bloomberg reports that:

Henry Nunez, a real estate agent in Arcadia, California, met with so many homebuyers from China that he bought a Mandarin-English translation app for his phone.

The $1.99 purchase paid off last month, when he sold a five-bedroom home with crystal chandeliers, marble floors and two kitchens, one designed for smoky wok cooking. The buyers were a Chinese couple who paid $3.5 million in cash.

Buyers from Greater China, including people from Hong Kong and Taiwan, spent $22 billion on U.S. homes in the year through March, up 72 percent from the same period in 2013 and more than any other nationality, the National Association of Realtors said yesterday in its annual report on foreign home purchases. That’s 24 cents of every dollar spent by international homebuyers, according to the survey of 3,547 real estate agents.

Chinese buyers paid a median of $523,148 per transaction, compared with a U.S. median price of $199,575 for existing-home sales.

Publicly traded builders are responding by catering to Chinese buyers in areas with high demand.Brookfield Residential Properties Inc. staged feng shui blessing ceremonies before beginning work on projects in Anaheim and Foothill Ranch communities in Orange County, south of Los Angeles. The New Home Co. consulted with a feng shui master on the land plan for its Orchard Park development in San Jose, California, that opened in April.

Buyers from China are driving up prices and fueling new construction in Southern California areas such as Arcadia, a city of about 57,500 people with top-rated schools, a large Chinese immigrant community and an array of Chinese restaurants and markets.

“About 90 percent of my buyers are from China,” said Peggy Fong Chen, a broker with Re/Max Holdings Inc., who sold 80 homes in Arcadia last year. “They want new construction. They want two levels. In China, it is considered a mansion if it has two levels.”

Chinese investors are moving into development in Arcadia, Chen said. They are buying lots with homes built in the 1970s and ’80s, tearing them down and erecting sprawling houses like the one Nunez sold for $3.5 million, which has a double-height entry hall and wood-paneled library.

“Local people really cannot afford these most of the time,” Chen said.

Since when did anyone care about the interests of the average American citizen anyway?

“A Chinese national bought one of our houses at Arcadia in Irvine after reading about it on a blog,” Tri Pointe CEO Doug Bauer said in a telephone interview. “It was a Chinese blog. We couldn’t even read it.”

Some wealthy Chinese have come up with ways to evade the yearly $50,000 per-person limit on taking money out of the country so they can buy U.S. real estate, Yu said. Methods include laundering money through Macau casinos and cooking the books of import-export companies, he said.