New Home Sales - NOW and BEFORE THE SHIT HIT THE FAN

[Truthmatters]

So we need to be more like East Germany....or some 3rd world country.

We shouldn't be growing but instead stagnating.

Nice to see how you think. I'll keep it in mind.

We should grow if the growth is real and sustainable, otherwise it is not growth. Merely a borrowing against our future. At some point the bill must be paid.

Yes...by you and me.

Not by those assholes in Washington.

Regulation of the market is the only way to prevent a repete, you can pretend its not but done expect rational minds to buy your unfettered markets crap after what the markets produced yet again.

 

[Care4all]

Obviously, there was NOT enough 'smart' regulations to prevent this from happening....the loop hole was opened and these guys ran with it.....but why they did such a foolish thing, is still beyond reason to me....it was beyond reckless and had no long term business sense imho?

What regulation would you have suggested to prevent this? I mean, without turning the U.S. into a command economy. I know that since you're a communist that isn't a bad thing. But for the rest of us free marketeers we want to avoid that.

THis was hardly the first real estate driven recession in our history. In fact, almost every recession has been driven by bad real estate loans (see, S&L Crisis). It is a natural fact of the business cycle, in this case made worse by low real interest rates.

No, the solution is clear: let the market clean up the mess. Let the banks foreclose on all those houses. Let them sell them for pennies on the dollar to qualified people who did the right thing. Make a pledge to end the "too big to fail" mentaltiy, and future intrusions of the gov't into lending. Restore certainty to the market.
The present course of this administration will have us arguing what to do with the excess inventory of houses into 2012.

Tell me something, "Mr. Free-marketeer" smarty pants....

Do you think our government should reform malpractice insurance policy and CAP malpractice lawsuits?

Should we allow Monopolies?

Should we allow bait and switch?

should your money in the bank not be FDIC insured?

Where does Free-market-teer stand on things like this???

There was no regulation or oversight of derivatives...
There was no longer regulation that kept commercial banking and investment banking separate, as there was in our country since the great depression.

 

[mudwhistle]

My guess is quite a few. With 0% down mortgages that are underwater, there is no reason for a speculator holding an empty property with no rental income to not go into foreclosure. Condos in places like Vegas and Florida were targeted by speculators during the bubble.

There was no housing glut.

Foreclosures were the result of several situations.

Lending to folks that couldn't afford the mortgage
Changes in lending requirements by the Fed and by government regulatory commissions
The lack of penalties for those who choose to walk away from a mortgage
Organized borrowing by SEIU members using race or economic status as a tool
Complex lending tools that were ending their fixed status and reverting to adjustable rates
The collapse of local economies in several Blue states. CA, WA, AZ, NV, IL, LA, OH, FL, NY, NJ, Michigan, etc

 

[Care4all]

We should grow if the growth is real and sustainable, otherwise it is not growth. Merely a borrowing against our future. At some point the bill must be paid.

Yes...by you and me.

Not by those assholes in Washington.

Regulation of the market is the only way to prevent a repete, you can pretend its not but done expect rational minds to buy your unfettered markets crap after what the markets produced yet again.

I agree with you TM, BUT WHERE is this new regulation? It still isn't done and the mess we got in can just repeat itself...the too big to fail will ALWAYS be there, IF we do not change some things and this congress has not tried to change things, as far as I am aware?

 

[boedicca]

My guess is quite a few. With 0% down mortgages that are underwater, there is no reason for a speculator holding an empty property with no rental income to not go into foreclosure. Condos in places like Vegas and Florida were targeted by speculators during the bubble.

There was no housing glut.

If you think there is no glut, I suggest you drive around the suburbs outside of Sacramento, or Tracy, or Vegas or condo complexes in Florida.

You'll see neighborhoods in which a few unfortunate people are still in their homes surrounded by deteriorating empty houses.

That is a symptom of a glut.

 

[Neubarth]

Realestate will recover when the glut is absorbed.

.

There is no glut of housing. There is a lack of buyers, because 33 million Americans are out of work and can not find full time employment. Give them their jobs back, and they will buy houses.

Saying that we have a glut of houses is totally wrong, just like putting the cart before the horses.

Inventory in excess of demand, regardless of the reason, is a glut. An empty home deteriorates or is vandalized, thus losing even more value. There's also the problem of location. A lot of the build up is in areas that are probably not going to see big job creation even during a recovery. Homes were built in bad locations under bubble circumstances. That's a dislocation job growth won't cure.

Typical liberal doublespeak. I suggest you read 1984.

People generally do not try to buy houses when they are unemployed. Put all of those newly unemployed back to work and they will be happy to buy all of the houses available on the market. Somehow, Obama and his corrupt administration simply can not understand this. The way to get us out of this horrible Depression is to put people back to work. BUT, nobody is doing anything to create jobs. Hummmmm? Time for a revolution.

 

[boedicca]

People generally do not try to buy houses when they are unemployed. Put all of those newly unemployed back to work and they will be happy to buy all of the houses available on the market. Somehow, Obama and his corrupt administration simply can not understand this. The way to get us out of this horrible Depression is to put people back to work. BUT, nobody is doing anything to create jobs. Hummmmm? Time for a revolution.

If you think I'm a liberal, then you don't know anything about me. I do have a background in economics - we have a glut of housing. If you don't grok that, then too bad for you.

 

[American Horse]

NEW HOME SALES

JAN 2010 309 K
DEC 2009 342 K
NOV 2009 370 K
OCT 2009 430 K

NEW HOME SALES BEFORE THE SHIT HIT THE FAN

JAN 2006 1207 K
DEC 2005 1298 K
NOV 2005 1233 K

To offset the error that there was a sudden building boom in 2005 - 2006 that has gone bust, I went back and got the numbers of new home sales for December of 2000. It was 1030K. With a lower population and less Green Card immigration, that number would coincide with the 1200K number of 2006. (i.e. there was not an outrageous building boom in houses, just an outrageous price increase.)

There are people out there (especially in Washington) who will tell you that we are in recovery. Tell that to all of the millions who used to work new home construction. For some reason they fail to see the recovery. Maybe we should order them some rose colored glasses so everything will look cheerful????

The lies of the present administration are so powerful that the Sheeple in our society think we are in some sort of recovery. When people are losing jobs left and right, we are not in recovery. We are still in a Depression era collapsing economy. Remember, in a service sector economy (70 percent of the American economy is service sector) rising unemployment as evidenced by UI claims as filed in the individual states are a leading indicator of further collapse in the economy.

As a builder/developer who actively built from 1972 until Jan 2006, the fact that appraisals on demand allowed about any project to find financing greater than the costs, the high ratio of loan to value being permitted, and the fact that about anyone could get a loan induced many who had been subs to become builders, and smaller builders to become large builders leading up to late 2009. Because the demand was there everyone who could was doing it, including the whole new industry of "mortgage brokers. As a builder, seeing what was going on, I for one was questioning how it would all pan out.
Now we know.

The weakest builders are now gone, their projects foreclosed on, with those whom they contracted with as well as the banks that financed their spec projects big losers.

 

[Neubarth]

People generally do not try to buy houses when they are unemployed. Put all of those newly unemployed back to work and they will be happy to buy all of the houses available on the market. Somehow, Obama and his corrupt administration simply can not understand this. The way to get us out of this horrible Depression is to put people back to work. BUT, nobody is doing anything to create jobs. Hummmmm? Time for a revolution.

If you think I'm a liberal, then you don't know anything about me. I do have a background in economics - we have a glut of housing. If you don't grok that, then too bad for you.

You are coming across as a totally ignorant liberal, refusing to see the reality as manifest in the numbers that show that the sales have plummeted because of a lack of buyers. Saying as you are, "Nah Nah Nah Nah Nah" and putting your head in the sand does not disprove that there is a shortage of financially capable buyers.

If they had jobs, they would be buying. You still have the cart before the horses. You make me laugh with your childish behavior.

 

[The Rabbi]

Obviously, there was NOT enough 'smart' regulations to prevent this from happening....the loop hole was opened and these guys ran with it.....but why they did such a foolish thing, is still beyond reason to me....it was beyond reckless and had no long term business sense imho?

What regulation would you have suggested to prevent this? I mean, without turning the U.S. into a command economy. I know that since you're a communist that isn't a bad thing. But for the rest of us free marketeers we want to avoid that.

THis was hardly the first real estate driven recession in our history. In fact, almost every recession has been driven by bad real estate loans (see, S&L Crisis). It is a natural fact of the business cycle, in this case made worse by low real interest rates.

No, the solution is clear: let the market clean up the mess. Let the banks foreclose on all those houses. Let them sell them for pennies on the dollar to qualified people who did the right thing. Make a pledge to end the "too big to fail" mentaltiy, and future intrusions of the gov't into lending. Restore certainty to the market.
The present course of this administration will have us arguing what to do with the excess inventory of houses into 2012.

Tell me something, "Mr. Free-marketeer" smarty pants....

Do you think our government should reform malpractice insurance policy and CAP malpractice lawsuits?

Should we allow Monopolies?

Should we allow bait and switch?

should your money in the bank not be FDIC insured?

Where does Free-market-teer stand on things like this???

There was no regulation or oversight of derivatives...
There was no longer regulation that kept commercial banking and investment banking separate, as there was in our country since the great depression.

Since you're a little thick, I will repeat the question:
What regulation would have prevented this without turning the U.S. into a command economy?

Pretty simple, eh?

 

[The Rabbi]

People generally do not try to buy houses when they are unemployed. Put all of those newly unemployed back to work and they will be happy to buy all of the houses available on the market. Somehow, Obama and his corrupt administration simply can not understand this. The way to get us out of this horrible Depression is to put people back to work. BUT, nobody is doing anything to create jobs. Hummmmm? Time for a revolution.

If you think I'm a liberal, then you don't know anything about me. I do have a background in economics - we have a glut of housing. If you don't grok that, then too bad for you.

You are coming across as a totally ignorant liberal, refusing to see the reality as manifest in the numbers that show that the sales have plummeted because of a lack of buyers. Saying as you are, "Nah Nah Nah Nah Nah" and putting your head in the sand does not disprove that there is a shortage of financially capable buyers.

If they had jobs, they would be buying. You still have the cart before the horses. You make me laugh with your childish behavior.

Look, the two of you are saying teh same thing.
WHen there is a mis-alignment of buyers and sellers, with many more sellers than buyers, then you have a glut on the market. The market will clear when the price of houses goes down. It is either that or increase the number of available buyers by, i.e. reducing credit criteria and/or interest rates. But that is how all this got started in the first place.
In the early 1990s in the aftermath of the S&L crisis the RTC was auctioning off condos for like 25cents on the dollar. There was a glut of property on the market. Eventually the low prices brought in bargain hunters adn the market cleared.
Same thing needs to happen now.

 

[bugs]

My Neighborhood Has More Than A Few Vacant Homes.. Sitting Unsold For Well Over 18 Months Now.

 

[Care4all]

What regulation would you have suggested to prevent this? I mean, without turning the U.S. into a command economy. I know that since you're a communist that isn't a bad thing. But for the rest of us free marketeers we want to avoid that.

THis was hardly the first real estate driven recession in our history. In fact, almost every recession has been driven by bad real estate loans (see, S&L Crisis). It is a natural fact of the business cycle, in this case made worse by low real interest rates.

No, the solution is clear: let the market clean up the mess. Let the banks foreclose on all those houses. Let them sell them for pennies on the dollar to qualified people who did the right thing. Make a pledge to end the "too big to fail" mentaltiy, and future intrusions of the gov't into lending. Restore certainty to the market.
The present course of this administration will have us arguing what to do with the excess inventory of houses into 2012.

Tell me something, "Mr. Free-marketeer" smarty pants....

Do you think our government should reform malpractice insurance policy and CAP malpractice lawsuits?

Should we allow Monopolies?

Should we allow bait and switch?

should your money in the bank not be FDIC insured?

Where does Free-market-teer stand on things like this???

There was no regulation or oversight of derivatives...
There was no longer regulation that kept commercial banking and investment banking separate, as there was in our country since the great depression.

Since you're a little thick, I will repeat the question:
What regulation would have prevented this without turning the U.S. into a command economy?

Pretty simple, eh?

Talk about being a tad thick headed....I answered you.

Regulation and oversight of the Derivative markets

and

The regulation that kept commercial and investment banks separate, with separate rules would have prevented the TOO BIG TO FAIL.

 

[Neubarth]

Look, the two of you are saying teh same thing.

Actually, NOT! She is saying that there are too many houses on the market because too many were built.

I am saying that there are too many houses on the market because there is a shortage of buyers because of this horrific depression.

She is denying the economic collapse. I am confirming it as the present ugly reality. We both know that there are more houses than buyers.

There was no tremendous increase in houses being built during the Boom years of 2005 - 7. There was a slight increase because of the good economy.

What we have seen in the past two years is a tremendous decrease in buyers because of the economy. Now, three out of every four construction workers are out of work or underemployed in their trades. This present malaise is not normal no matter how much she wants to believe it is. Normal was what we had in 2005. Abnormal is what we have now.

 

[Care4all]

Look, the two of you are saying teh same thing.

Actually, NOT! She is saying that there are too many houses on the market because too many were built.

I am saying that there are too many houses on the market because there is a shortage of buyers because of this horrific depression.

She is denying the economic collapse. I am confirming it as the present ugly reality. We both know that there are more houses than buyers.

There was no tremendous increase in houses being built during the Boom years of 2005 - 7. There was a slight increase because of the good economy.

What we have seen in the past two years is a tremendous decrease in buyers because of the economy. Now, three out of every four construction workers are out of work or underemployed in their trades. This present malaise is not normal no matter how much she wants to believe it is. Normal was what we had in 2005. Abnormal is what we have now.

but there was NO GOOD ECONOMY....the ''supposed'' good economy CAME from the housing BUBBLE.....people took out second mortgages or took out the increased FAKE EQUITY in their homes to use, to spend....

the WHOLE THING was a sham....there was no ''good'' economy....there was no rising pay for the middle class....only rising productivity.

 

[The Rabbi]

Tell me something, "Mr. Free-marketeer" smarty pants....

Do you think our government should reform malpractice insurance policy and CAP malpractice lawsuits?

Should we allow Monopolies?

Should we allow bait and switch?

should your money in the bank not be FDIC insured?

Where does Free-market-teer stand on things like this???

There was no regulation or oversight of derivatives...
There was no longer regulation that kept commercial banking and investment banking separate, as there was in our country since the great depression.

Since you're a little thick, I will repeat the question:
What regulation would have prevented this without turning the U.S. into a command economy?

Pretty simple, eh?

Talk about being a tad thick headed....I answered you.

Regulation and oversight of the Derivative markets

and

The regulation that kept commercial and investment banks separate, with separate rules would have prevented the TOO BIG TO FAIL.

WHat regulation of the derivatives market (whatever that is) would have prevented this?
How did repealing Glass-Steagall, which occurred in 1999, cause the housing collapse eight years later??
And we had numerous housing collapses, like the S&L crisis, even while Glass-Steagall was in effect. So that pretty much destroys your theory.
It is clear you don't have a clue what you are talking about, merely mouthing left-wing talking points you heard somewhere or other.

 

[goldcatt]

Look, the two of you are saying teh same thing.

Actually, NOT! She is saying that there are too many houses on the market because too many were built.

I am saying that there are too many houses on the market because there is a shortage of buyers because of this horrific depression.

She is denying the economic collapse. I am confirming it as the present ugly reality. We both know that there are more houses than buyers.

There was no tremendous increase in houses being built during the Boom years of 2005 - 7. There was a slight increase because of the good economy.

What we have seen in the past two years is a tremendous decrease in buyers because of the economy. Now, three out of every four construction workers are out of work or underemployed in their trades. This present malaise is not normal no matter how much she wants to believe it is. Normal was what we had in 2005. Abnormal is what we have now.

You're both right. Too many were built AND there is a shortage of qualified buyers.

And what personal and/or financial stake do you have in the home construction industry, anyway?

 

[bugs]

Look, the two of you are saying teh same thing.

Actually, NOT! She is saying that there are too many houses on the market because too many were built.

I am saying that there are too many houses on the market because there is a shortage of buyers because of this horrific depression.

She is denying the economic collapse. I am confirming it as the present ugly reality. We both know that there are more houses than buyers.

There was no tremendous increase in houses being built during the Boom years of 2005 - 7. There was a slight increase because of the good economy.

What we have seen in the past two years is a tremendous decrease in buyers because of the economy. Now, three out of every four construction workers are out of work or underemployed in their trades. This present malaise is not normal no matter how much she wants to believe it is. Normal was what we had in 2005. Abnormal is what we have now.

but there was NO GOOD ECONOMY....the ''supposed'' good economy CAME from the housing BUBBLE.....people took out second mortgages or took out the increased FAKE EQUITY in their homes to use, to spend....

the WHOLE THING was a sham....there was no ''good'' economy....there was no rising pay for the middle class....only rising productivity.

i Agree.. People Were Spending Like CRAZY With $ That They Did NOT Have (Credit)

 

[The Rabbi]

Look, the two of you are saying teh same thing.

Actually, NOT! She is saying that there are too many houses on the market because too many were built.

I am saying that there are too many houses on the market because there is a shortage of buyers because of this horrific depression.

She is denying the economic collapse. I am confirming it as the present ugly reality. We both know that there are more houses than buyers.

There was no tremendous increase in houses being built during the Boom years of 2005 - 7. There was a slight increase because of the good economy.

What we have seen in the past two years is a tremendous decrease in buyers because of the economy. Now, three out of every four construction workers are out of work or underemployed in their trades. This present malaise is not normal no matter how much she wants to believe it is. Normal was what we had in 2005. Abnormal is what we have now.

but there was NO GOOD ECONOMY....the ''supposed'' good economy CAME from the housing BUBBLE.....people took out second mortgages or took out the increased FAKE EQUITY in their homes to use, to spend....

the WHOLE THING was a sham....there was no ''good'' economy....there was no rising pay for the middle class....only rising productivity.

You truly are at sea here. No good economy, only rising productivity? Hello? How else do you define a good economy?
We had seven years of low inflation, low interest rates, low unemployment, and rising GDP following the Bush tax cuts. I believe it was the second highest record for expansion post-WW2. If that is a sham then I want more of them.

 

[goldcatt]

Actually, NOT! She is saying that there are too many houses on the market because too many were built.

I am saying that there are too many houses on the market because there is a shortage of buyers because of this horrific depression.

She is denying the economic collapse. I am confirming it as the present ugly reality. We both know that there are more houses than buyers.

There was no tremendous increase in houses being built during the Boom years of 2005 - 7. There was a slight increase because of the good economy.

What we have seen in the past two years is a tremendous decrease in buyers because of the economy. Now, three out of every four construction workers are out of work or underemployed in their trades. This present malaise is not normal no matter how much she wants to believe it is. Normal was what we had in 2005. Abnormal is what we have now.

but there was NO GOOD ECONOMY....the ''supposed'' good economy CAME from the housing BUBBLE.....people took out second mortgages or took out the increased FAKE EQUITY in their homes to use, to spend....

the WHOLE THING was a sham....there was no ''good'' economy....there was no rising pay for the middle class....only rising productivity.

i Agree.. People Were Spending Like CRAZY With $ That They Did NOT Have (Credit)

Tulips, anyone?

The only real difference is homes are at least useful as shelter.