Friday, March 01, 2013

HOUSING RECOVERY MIRAGE

Have you seen the headlines, heard the news "HOUSING IS ROCKING", NEW HOME SALES SKYROCKET"," HOME PRICES INCREASE AGAIN AND ON THE MEND"

Here's the reality

Think again of where interest rates are right now.....it took rates at 3% to accomplish what you see in the chart above. Median home prices in 2005 were $231,000, they HAVE recovered to $173,000. SO MOST if not ALL the homeowners since 2005 are STILL under water.

With all this talk about a housing recovery, it is logical to consider many of these people who want to get away from the housing boat anchor will LIST THEIR HOME, when MORE supply comes onto market than demand, what happens to price?

AT least 50% of homes sold are still foreclosed homes.....we have a LONG WAY to go.

In the meantime, we have inflationary pressures, we have a FED who started just 5 years ago with $800B and now has around $3 TRILLION in holdings....almost none of it is LIQUID. DO the math

D

6 comments:

Jack B said...

That's right, I am on record, and so are you. Broken record, but on record.

Tuesday, July 10, 2012
PURE GENIUS
http://finance.yahoo.com/news/biggest-danger-now-not-being-074252794.html
"Not being invested in equities right now is one of the "most dangerous" things to do, according to Jack Bouroudjian, CEO of Bull and Bear Partners, who believes U.S. companies will beat Wall Street's estimates for second-quarter earnings.

Corporate America is "richer than ever before" and consumers have more disposable cash because of recent lower oil prices, Bouroudjian told CNBC on Tuesday, adding that the extra cash will boost earnings and bode well for stocks in the next few years. "

Mark it down, he's on record......certainly stocks are not over valued? but certainly in bonds you get NO yield..it's fixed


Jay Jay said...

I am short the housing sector. Great post.

jay

Anonymous said...

That high on the chart shows just how overvalued housing was at the peak. Waay overvalued. Back down to reality.

John Kelly said...

I'm short the housing sector too. Great call.

Marc R said...

Who the F would add their mug shot if they looked like that?

You hear , like today....housing prices rose 9% yr over year...while that is good..just saying that is very deceiving.. prices are WELL off their highs...I guess improvement is better than alternative.

I agree ALL sectors are getting ripe, but guys BE CAREFUL...they DO NOT CARE WHAT BUBBLE they are now creating as it wa better than what we had......the NEXT ONE when it pops will be a real muther fker

Marc R said...

The mug shot comment, you guys know that was the old dude I was talking about Jack B? haaa