US Housing Market to Get Uglier in Near Future

Thursday, January 3, 2019 by Wolf Richter https://wolfstreet.com

Sales decline to steepen, no respite in sight.

The reasons for the housing-market downturn are in the eye of the beholder, as we will see in a moment. But whatever the reasons for it may be, the data on the housing market is getting uglier by the month.
Pending home sales is a forward-looking measure. It counts how many contracts were signed, rather than how many sales actually closed that month. There can be a lag of about a month or two between signing the contract and closing the sale. This morning, the National Association of Realtors (NAR) released its Pending Home Sales Index for November, an indication of the direction of actual sales to be reported for December and January. This index for November fell to the lowest level since May 2014.

“There is no reason to be concerned,” the report said, reassuringly. And it predicted “solid growth potential for the long-term.” And the index plunged 7.7% compared to November last year, the biggest year-over-year percentage drop since June 2014. The drops in October and November are indicated in red:

All four regions got whacked by year-over-year declines:
Northeast : -3.5%
Midwest: -7.0%
South: -7.4%
West: -12.2%

The plunge in pending home sales in the West, a vast and diverse region, will prolong the plunge in closed sales for the region. Particularly on the West Coast, the largest and very expensive markets — Seattle metro, Portland metro, Bay Area, and Los Angeles area — have been experiencing sharp sales declines, a surge in inventory for sale, and starting this summer, declining prices.

Today’s pending home sales data confirms that these trends are intact and will likely continue.
The NAR report blames the sales decline in the expensive markets in the West on “affordability challenges” – because prices “have risen too much, too fast,” it said.

And this is a true and huge problem: Home prices have shot up for years, even while wages ticked up at much slower rates. At some point, the market is going to run out of people with median incomes who are willing to stretch to the limit to buy a starter shack; and the market is going to run out of people with high incomes who are willing to stretch to the limit to buy a median house.

For example, at the peak, the median house price in San Francisco was over $1.7 million. That median house is nothing fancy. And the market has run out of high-income people blowing so much money on a modest house. Hence prices have come down sharply over the past six months.

“Local officials should consider ways to boost local supply,” the report says. Alas, there is all kinds of supply suddenly coming on the market. It’s not that there isn’t anything to buy; the problem is that everything is too expensive, and that sellers and buyers no longer see eye-to-eye.

But the decline in sales on a national basis, according to the report, is a “short-term pullback” that “does not yet capture the impact of recent favorable conditions of mortgage rates.”

Sure, lower mortgage rates are a relief for buyers. But wait… According to the Mortgage Bankers Association, the average rate of conforming 30-year fixed-rate mortgages with a 20% down payment has dropped to 4.94% during the latest reporting week. This is 23 basis points off the high of 5.17% in early November.

But here is the thing: In January 2018, when the Pending Home Sales index plunged to the lowest level since December 2015 (indicated in the first chart above), the NAR blamed low supply of homes and surging mortgage rates.
Since then, supply has sharply increased, and mortgage rates?

Currently, the average 30-year fixed rate, at 4.94%, is still 54 basis points higher than it had been in January. And if an average mortgage rate of 4.4% was blamed for plunging home sales in January, then an average rate of 4.94% isn’t going to suddenly boost sales.

There is a lot more at play here than just wobbling mortgage rates. At the top of the list are woefully inflated prices that potential buyers now see as such.

And these potential buyers are now also confronting the fear that prices will decline, or further decline, after they buy. This is a scary thought, given the amount of leverage and the large dollar figures involved in a home purchase. Potential buyers now see that after the purchase, those fears could translate into some real and long-lasting headaches.

n Seattle, house prices dropped 4.4% in four months, the biggest four-month drop since Housing Bust 1, according to the Case-Shiller Home Price Index. Prices also deflated in the San Francisco Bay Area, San Diego, Denver, and Portland.

The Rest Of The Story Here

Peter is a Real Estate Broker at Professional Brokers Group (License No. 023000), covering the greater Short Sale area of Colorado.
Phone: 720-299-7373
Email Us

Please fill out the contact form below if you wish for Peter to contact you.
[contact-form-7 404 "Not Found"]

Short Sale Realtor short sale realtor    short sale specialist in Short Sale Realtor


Helping Short Sale Realtor home owners avoid foreclosure with a short sale.
Peter Janisch specializes in short sales in Short Sale Realtor. I am your Short Sale Realtor Short Sale Specialist Realtor and Short Sale Realtor loan modification and distressed property expert. This article and content is for general informational purposes and may not be accurate. This should not be taken as legal advice, technical or tax advice under any circumstance. Seek legal advise and representation in all legal matters.



The Central Banks Exposed, Growth Slowing, Global Economic Disaster

Greg Hunter

Published on Dec 22, 2018

Journalist Alex Newman thinks the huge global political unrest is much more than conservatives against liberals. Newman says, “If you think this is a political problem you are missing the point. . . . We are dealing with a diabolical conspiracy that hates God and hates God’s people, hates his church and everything He has ordained. Everything you would expect to see is exactly what you see. God ordained there should be nations after the Tower of Babel. So, of course, the Globalist wage war on nation states. God has ordained there should be families. So what do we see? A massive global war on families. God has ordained private property. Thou shalt not steal. So what do we see? A massive global war on private property. . . . It’s ludicrous, but it is everything we should expect to see from a force that hates God. I think that is what we see.”

Join Greg Hunter as he goes One-on-One with Alex Newman journalist for The New American.

Donations: https://usawatchdog.com/donations/

Stay in contact with USAWatchdog.com: https://usawatchdog.com/join/

All links can be found on USAWatchdog.com: https://usawatchdog.com/mass-migratio...

Peter is a Real Estate Broker at Professional Brokers Group (License No. 023000), covering the greater Short Sale area of Colorado.
Phone: 720-299-7373
Email Us

Please fill out the contact form below if you wish for Peter to contact you.
[contact-form-7 404 "Not Found"]

Short Sale Realtor short sale realtor    short sale specialist in Short Sale Realtor


Helping Short Sale Realtor home owners avoid foreclosure with a short sale.
Peter Janisch specializes in short sales in Short Sale Realtor. I am your Short Sale Realtor Short Sale Specialist Realtor and Short Sale Realtor loan modification and distressed property expert. This article and content is for general informational purposes and may not be accurate. This should not be taken as legal advice, technical or tax advice under any circumstance. Seek legal advise and representation in all legal matters.



United States Doesn’t Need the Fed

The Fed Mandate Is to Ensure a “Healthy Economy” – Instead in 4 Mos. Fed Destroyed Historic Trump Economy and Working Americans’ Life Savings

by Jim Hoft December 23, 2018

The Fed and its Head – Jerome Powell – have mandates to”promote stable prices” and “maximum employment” and to ensure a “healthy economy”. However, the Fed’s recent radical and consistent rate hikes are destroying the economy and doing nothing close to their mandates. The Federal Reserve states on their website that two of its functions are to conduct monetary policy and promote financial system stability.

But the Fed is currently not sticking to its mandates – Just look at the Fed’s rate increases this century and since President Trump won the 2016 election. The Fed lowered interest rates to 0% for the Obama Administration and kept these rates at 0% for the first 7 years of Obama’s time in office. Finally, the Fed increased the interest rates 0.25% in late 2015 for the only increase during Obama’s Presidency up to the 2016 election.

After President Trump won the November 2016 election, the Fed began a steady program of increasing interest rates. This program continues to this day and in total the Fed has increased rates 8 times since Trump won the Presidency. The rates now stand at 2.25% and as a result of these horrible and political policies, the Trump economy and Americans’ 401(k)’s are being devastated.

Top US economist Stephen Moore stated –
Unfortunately, if you cut engine power too far on a jetliner, it will stall and drop out of the sky.
On Wednesday, December 19, despite the numerous market-based alarms that were sounding in the cockpit, Chairman Powell and his co-pilots on the FOMC voted to raise the Fed Funds rate to 2.50%. This sucks more dollars out of the economy at a time when the world demanding more dollars – thanks to Trump’s Tax cutting and deregulation policies.

Chairman Powell has been entirely tone deaf to the financial markets he seeks to protect. The Dow Jones Industrial average, which had risen by 382 points on hopes that the Fed would listen to President Trump and stop cutting power, plunged by 895 points after the 2:00 PM announcement, and closed the day down 352 points (1.49%). Poof, trillions of dollars of wealth vanished.

Since its peak on October 3, which, not coincidentally, was right after Chairman Powell gave a speech suggesting that the Fed might be through tightening money, the Dow has fallen by more than 3,500 points [now 4,500]. Market fears about his bad judgment have cut the value of all U.S. stocks by about $4.5 trillion, which is enough to buy 16,000 Boeing 787 Dreamliners.

The Fed economists use twisted logic that the economy is “strong enough” to absorb the rate hikes – which is simply an admission that their policy will slow growth.

The markets were up nearly 50% since the President won the 2016 election. Then in early October, the Fed Chief announced more interest rate hikes. Since then the markets have been devastated. The markets are down about 20% since that time and now are down for the year.

Also, what’s not in the mainstream yet is how the Fed is adding billions to the annual US debt with their corrupt and crooked policy of raising rates on the Trump Administration.

The US debt now stands at $21.8 trillion.

A 2.25% interest increase on this amount of debt is an annual increase in debt interest payments of $500 billion!!!
Fed Chief Powell and the Fed have added a half a trillion to the annual US debt payment through their reckless and crazy debt increases! To think President Trump has to shut down the government to get $5 billion for border security.
The Fed could reduce rates 0.25% and easily pay for it.

The Fed Mandate Is to Ensure a “Healthy Economy” – Instead in 4 Mos. Fed Destroyed Historic Trump Economy and Working Americans’ Life Savings

BREAKING–> TRUMP BLASTS CRAZY MAN JEROME POWELL! — Jackass DESTROYED Economy, Crushed Middle Class, Raised US Debt $500 Billion a Yr

BREAKING–> TRUMP BLASTS CRAZY MAN JEROME POWELL! — Jackass DESTROYED Economy, Crushed Middle Class, Raised US Debt $500 Billion a Yr

Peter is a Real Estate Broker at Professional Brokers Group (License No. 023000), covering the greater Short Sale area of Colorado.
Phone: 720-299-7373
Email Us

Please fill out the contact form below if you wish for Peter to contact you.
[contact-form-7 404 "Not Found"]

Short Sale Realtor short sale realtor    short sale specialist in Short Sale Realtor


Helping Short Sale Realtor home owners avoid foreclosure with a short sale.
Peter Janisch specializes in short sales in Short Sale Realtor. I am your Short Sale Realtor Short Sale Specialist Realtor and Short Sale Realtor loan modification and distressed property expert. This article and content is for general informational purposes and may not be accurate. This should not be taken as legal advice, technical or tax advice under any circumstance. Seek legal advise and representation in all legal matters.



Anons Were Right,16 Year Plan Stopped, Full Control, PANIC