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The Manufactured Housing Bubble Finally Popped

https://www.youtube.com/watch?v=mczUjOm8jkA




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  1. The first 18 minute video:

    Listing Success Rate Down! | Phoenix Real Estate Market UpdatePremiered Jul 18, 2022 The Phoenix real estate market is seeing a weakening in the listing success rate and now has 2 cities in a buyer’s market! 6 other cities in the Phoenix metro real estate market are following close behind and projected to be in a buyer’s market by end of August. Which cities? Watch to get all the details!
    *Source: Cromford Report

    CHAPTERS:
    0:00 – Intro
    0:53 – Inflation News
    3:16 – Listing Success Rate
    5:47 – Average Sales Price Per Sqft
    7:37 – Rental Updates
    9:49 – CMI Definition
    10:15 – CMI
    11:52 – Every city CMI
    16:17 – What I’m Seeing in the Market

    The second 12 minute video:

    sandiegorealestate
    Eric’s Neighborhood Watch
    Jul 18, 2022 More homes for sale in 92103! Proper Pricing is Key!🔑

    The third 9 minute video:

    Housing Market Update June 2022 Brevard County and Cocoa Beach Florida
    Premiered 19 hours ago Housing Market Update June 2022 Brevard County and Cocoa Beach Florida
    How’s the market????
    FINALLY…we are getting some inventory!!! 1st time since May 2018 we had over 1900 new listings enter the market in a month. Our active inventory is also creeping back up with back to back months where we were over 1000 properties for sale. Our market is changing!!! Is this the bubble about to burst? Time will tell if its that dramatic…

    The fourth 9 minute video:

    Brampton House loses $512,000 in value
    Jul 18, 2022 Quick update here on the GTA housing market. Another video coming later this week talking about the new proposal to cap all rental increases in Toronto (terrible idea).

    The last 9 minute video:

    The Manufactured Housing Bubble Finally Popped
    Jul 17, 2022 Manufactured home price have been steadily increasing for the last two years, until now. I have been tracking the price increases from manufacture home factories for the last two years and have just received the first official price increase. The demand for manufactured homes has been steady and that combined with the rising cost of building materials caused prices to rise faster than I’ve ever seen. The last increase I received was on March 15th and now prices are heading back down. If you have been waiting for home prices to peak your opportunity to buy may finally be approaching and in this video I tell you the information relevant to the situation. Watch and learn more about how much prices are going down, why and where I think they’re going from here.

    2. The 92103 zip has ocean influence, i.e., as the inland region heats-up causing warm air to rise, the ocean air moves toward land cooling off the gilded class with their low interest mortgages.

  2. The housing market recession continues, despite starts data

    The collapse of homebuilder sentiment is the real story
    July 19, 2022, 2:07 pm By Logan Mohtashami

    1. Lisa Belifuss: Sure. So some experts have been warning for quite some time going back before the pandemic that there was a bubble building in the car market. And fast forward through some of the events over the past two years, and now it seems like that bubble might be about to burst. That’s according to some of my recent reporting. It’s anecdotal by design because some of the data is hard to get from banks, and once you see it, it’s dated.

      So I’ll tell you a little bit about what I recently heard from a car dealer. He is in the business of buying repossessed cars from banks, and he says that recently repossessed cars have been surging. And some common characteristics are that those loans were extended between 2020 and 2021. And that’s unusual because usually people fall on hard times at different times. So the fact that it’s all happening at once is noticeable.

      The other thing is that people took on more debt. There’s a metric in the business called loan to value, LTV, and those have been very elevated, meaning people are underwater on their loans. And the last thing is that this broker told me that he’s seeing a lot of the repossessed cars they were given, the loans were given to people who had temporary pops in income. And that is explained by some of the pandemic programs, such as debt forbearance and enhanced unemployment benefits, stimulus checks that may have made people look like better borrowers for a brief time than they actually were.

      So they were receiving extra income during the pandemic for a number of reasons: unemployment benefits, pandemic stimulus, debt forbearance, that sort of thing. And so it increased, at least temporarily, their bottom line, which made them look better as borrowers. And we should point out, this has led to a large number of car repossessions, primarily for vehicles with loans from 2020 and newer. Right?

      That’s right. That’s right. And what I have heard from this person that I mentioned, as well as consumers out there, banks normally do income verification, meaning they would not just look at the current earnings, which was propped up by these pandemic programs that we mentioned. They would normally look back further in time and that wasn’t happening. So banks, they kind of helped contribute to what this bubble is seeming to, you know, the bubble that’s shaping up. And also what happened is it sort of become this cycle where, as cars became more expensive because there was more demand, it became a self-fulfilling prophecy where people had to take on more loans in order to get their hands on something.

      I’ve heard in some places like D.C., nearly one in two of all cars that were purchased since 2020 are in default. That’s incredible. But still, even if you look nationwide, it’s more like up about 2% or something like that. That doesn’t sound too bad on the surface.

      It doesn’t. And that’s why I approached this story with anecdotal reporting. There are some signs that subprime borrowers, not just in autos, but in in other types of loans, are running into some trouble, as you’ve got a lot of crosscurrents. You’ve got the situation we’re talking about specifically in autos but economy wide you have inflation hitting a new 40 year high in June with overall prices up over 9%. And that says there are some signs of slowdown in the economy. More people are starting to lose their jobs. Concerns about recessions are rising. And so, it’s not altogether surprising that people who have lower credit scores are starting to have a harder time paying their loans. But what I discovered in the course of reporting this story is that even prime borrowers, even though the repossession rates for cars, is rising in that group, and those are people, of course, you have more solid credit scores.

      The last time I heard about subprime loans cratering and people with better credit scores having difficulty carrying their loans was back during the housing crisis of 2007, 2008. A car is the second biggest purchase after a house. What sort of ripple effects could this have?

      That is the question I’ve been asking too. Some people have made comparisons to the housing bubble that you referenced. And as as you say, it’s a big purchase for many families. I think more people own a car than a house. But then, I also hear that people are more likely to pay their car payments before many other payments because you need your car more than other things. So you might be late on a credit card before you’ll be late on your car. So sometimes is as there is building trouble in the auto loan market it is a bigger red flag that things are going south in the economy. But how that ripples out, I think we just don’t know yet.

      1. how that ripples out, I think we just don’t know yet.

        You know. Just afraid to say it.

      2. And we should point out, this has led to a large number of car repossessions, primarily for vehicles with loans from 2020 and newer. Right?

        What is odd about this is that new cars were heavily discounted in 2020. It wasn’t unusual to be able to get one for 30% less than MSRP. Yet these buyers eyes got bigger than their wallets and they bought something they were doomed to lose. So the got the 50K SUV for 35K, they still couldn’t afford it once the free cheese ended.

        Also makes you wonder how many idiots quit their jobs, only to find that getting a new one was a lot harder than they thought it would be, and it didn’t pay more than the old job.

      3. “I’ve heard in some places like D.C., nearly one in two of all cars that were purchased since 2020 are in default.”

        What’s wrong with just saying, nearly half?

        1. It is a staggering number, 50% are repo’d in DC.

          My credit union used to display any repos they had parked in front with for sale signage. There were usually one or two, maybe three. This was years ago. I haven’t seen any in a long time, so I presume they just wholesale them to an auction house.

  4. ‘RE/MAX Realty released the company’s national housing report for June, and while prices continued to show large year-over-year gains in the Tampa area, the red hot housing market may be starting to cool off.’

    “Sellers were a little spoiled over the last couple of years. Now because they want to make sure that they sell their home and they get a good price, they’re more open to negotiation,” said Kendall Bonner Broker/Owner of RE/MAX Capital Realty.’

    https://www.abcactionnews.com/news/region-hillsborough/home-inventory-rises-in-june-as-sales-hit-2022-high-re-max-analysis-finds

  5. “We are coming back down to our normal pace,” said Dejan Eskic, a senior research fellow at the University of Utah’s Kem C. Gardner Policy Institute. “A metaphor I like to use is — prior to pandemic we were going 65 miles per hour, then, right up to 120-130 miles per hour, now we are back down between 65-70 miles an hour.”

    ‘During the pandemic boom, many houses in Utah sold within hours or days of being listed; but that is no longer the case.’

    ‘The median home sales price in Utah rose from $325,000 in June 2019 to more than $500,000 in June 2022. “We estimate roughly 75-80% of Utah households cannot afford the median priced home,” Eskic said.’

    https://www.fox13now.com/news/local-news/utah-home-values-remain-high-as-inventory-increases-market-cools

    1. “We estimate roughly 75-80% of Utah households cannot afford the median priced home,” Eskic said.’

      No one could have seen the crash coming.

      1. Here in Utah the constant refrain is everyone in California is a millionaire and they call come here with their buckets of cash offers and purchase 3+ homes, one for living the others for rentals. Due to this, our prices can go up forever.

        The best part of this fantasy is the argument that everyone in California wants to live in South Jordan. Half my friends in Southern California won’t even visit Utah due to their biases, and I cannot imagine anyone with a $2 million dollar home on the beach wants to live in the high-desert on a tiny little lot. I could be wrong though.

    2. “We estimate roughly 75-80% of Utah households cannot afford the median priced home,” Eskic said.

      I got into economics because I wanted to make things better for the average person. —Ben Bernanke

  6. ‘Stuart Kirk is a financial executive who either erred by making an ill-advised departure from his employer’s messaging on climate change, or played devil’s advocate and became a victim of corporate cancel culture.’

    ‘Mr. Kirk, the top executive in charge of responsible investing at HSBC’s asset-management arm, went off the British bank’s script at a public forum last month by criticizing those who make dire predictions about climate change and play up the finance industry’s responsibilities for combatting it. He has been sidelined as a result.’

    ‘His smackdown raises important questions: How much latitude do iconoclasts have in the world of climate finance at a time when it is easy to assert that there are more immediate problems? Also, must you adopt and stick to your employer’s messaging on the topic? It’s certainly shown how skittish the corporate world is when it comes to messaging on climate change.’

    ‘The episode adds fuel to an already-heated global debate about the effectiveness of corporate environmental, social and governance, which pits its devoted adherents against those that decry it as a left-wing plot against business.’

    ‘At the podium during the Financial Times’ Moral Money Summit, Mr. Kirk launched into territory that would make any chief sustainability officer gasp. He said the financial risk stemming from climate change is overblown, and that over 25 years in the finance industry he was always hearing from “some nut job” warning of end times. Humans, meanwhile, are very good at adaptation.’

    ‘In his remarks, which are posted on YouTube, he took aim at former Bank of England and Bank of Canada governor Mark Carney, a driving force behind global climate finance initiatives including the Glasgow Financial Alliance for Net Zero. HSBC is a member of that group, which seeks to align investment decisions with the goals of the Paris Agreement.’

    “I completely get that at the end of your central-bank career there are still many, many years to fill in. You’ve got to say something, you’ve got to fly around the world to conferences, you’ve got to out-hyperbole the next guy,” he said.’

    ‘Mr. Kirk went on to lament the requirements of dealing with the decades-out problem of climate-related risk, when HSBC is struggling today with the move to cryptocurrencies, rising interest rates, inflation, a housing crisis and “the China problem.”

    ‘For the top brass at the bank, where ESG performance is being played up alongside financial results, that all came off about as well as you would expect.’

    ‘On Tuesday, police raided the Frankfurt offices of Deutsche Bank AG’s asset-management division DWS to conduct a search in connection with accusations of investment fraud related to greenwashing. The group has been the subject of investigations in Germany and the United States.’

    ‘The legal troubles follow allegations by the unit’s former chief sustainability officer that DWS’ assertions that hundreds of billions of dollars of assets under management were “ESG-integrated” were misleading, according to Bloomberg. The CEO of DWS, Asoka Woehrmann, resigned on Wednesday.’

    ‘Expect more scrutiny of ESG declarations by both investors and regulators, especially if financial returns lag past performance amid all of the economic and political turmoil swirling. As a reality check, this may be the time to pay some attention to the ESG skeptics. The call could be coming from inside the house.’

    https://www.theglobeandmail.com/business/commentary/article-challenge-esg-without-being-cancelled-stuart-kirk-hsbc/

    1. Expect more scrutiny of ESG declarations by both investors and regulators

      ESG == The Great Reset

  7. ‘An Oxford Economics index out last week showed homes were the least affordable in the first quarter of 2022 at any time since the 2007-2009 financial crisis, and it forecast that picture would worsen through the rest of this year.’

    ‘Meanwhile, a survey out on Monday showed the National Association of Home Builders/Wells Fargo Housing Market Index suffering its second-largest drop on record in July, with a gauge of prospective buyer traffic falling below the break-even level of 50 for a second straight month.’

    https://www.msn.com/en-ca/money/topstories/us-housing-starts-drop-to-lowest-in-nine-months-in-june/ar-AAZK5YU?fromMaestro=true

  8. ‘A new study released Tuesday shows an 80-year-old law meant to put rundown Chicago properties back to use has done little to help racial inequalities in the city’s Black and Latino communities. The study says the majority of distressed properties in Chicago and the Cook County suburbs falls into areas that were redlined by the federal government in 1940, or in areas into which Black people moved to escape urban blight, Treasurer Maria Pappas said in a news release.’

    ‘Redlining is defined as the practice of denying loans to homebuyers in minority areas by proclaiming them a financial risk. Maps had such areas literally shaded in red.’

    “Redlining may be illegal now, but housing discrimination still exists,” Pappas said in a news release. “Today’s problem of abandoned properties and boarded-up businesses is a blister that’s been festering for 80 years and needs a lancing. This study is meant to be the needle.”

    https://www.msn.com/en-us/news/us/study-effects-of-redlining-in-chicago-and-suburbs-continues-to-perpetuate-blight-in-many-communities/ar-AAZL0hm

  9. ‘While housing on Hilton head is still selling at increasingly high prices, experts say other numbers are declining showing that the market is finding its new normal.’

    “At one point a multiple offer scenario was pretty much the norm and now we’re seeing where we’re getting offers on our listings and there might be a couple of offers, but you don’t need 30 or 40 offers to get a good contract on a property,” said Kate Yachini, the president of Hilton Head Area Realtors.’

    ‘She says year over year, median sales prices in the lowcountry has risen 28.7%, but the number of sales itself has decreased due to a smaller inventory. “The market is still good, our prices are still high, but the sales are down.”

    ‘She wants it to be very clear that this does not mean it’s no longer a sellers market but instead it’s just normalizing what the market looks like for possibly years to come.’

    https://www.msn.com/en-us/travel/news/housing-market-normalizing-on-hilton-head-island-according-to-hilton-head-area-realtors/ar-AAZKOY6

  10. ‘Utah has now seen one of the biggest housing price cuts in the nation. Salt Lake City has taken the third highest ranking in price cuts according to data from Redfin, which saw more than half of homes on the market with lowered housing prices. Boise, Idaho and Denver, Colorado took the number one and two spots.’

    ‘One of the leading factors of this major price cut was that the West saw an explosion in the housing market as the pandemic hit, and Utah was already experiencing an increase in housing prices even before the pandemic. Utah is also one of the fastest growing states in the nation and already had a housing shortage.’

    ‘Experts say that sellers might have missed the chance to sell their homes at the peak of housing prices, but that it is better to sell sooner rather than later.’

    https://www.upr.org/utah-news/2022-07-19/utah-sees-a-big-drop-in-housing-prices

  11. ‘Even state-backed Securities Times last week raised the specter of systemic financial risk in an article that encouraged local governments and developers to deliver houses on time. “Credit losses relating to mortgage loans are minimal and the affected balances are small at most Chinese national banks currently,” Harry Hu, senior director at S&P Global Ratings, said in a statement.’

    “But downside pressure could build if the latest suspension in mortgage repayments by some resident groups in China is not managed well and manifest into system risks,” Hu said.’

    https://www.msn.com/en-us/money/markets/chinas-homebuyers-are-running-out-of-patience-with-the-real-estate-slump/ar-AAZLn8m

  13. ‘Amid the growing hoopla last year, some NFTs sold for millions of dollars, garnering national headlines with each transaction. Tech enthusiasts watched as a collection of NFTs from Bored Ape Yacht Club featuring flashy cartoon ape depictions sold for top dollar. The entry bid for a Bored Ape NFT was 52 ether in January 2022, the equivalent at the time of $210,000, according to CNET. Buyers included celebrities such as Jimmy Fallon, Steph Curry and Post Malone.’

    “Everyone was chasing the FOMO,” Ozair said.’

    https://www.cbsnews.com/news/nft-sales-2022-nonfungible-cryptocurrency-bitcoin/

  15. Raleigh, NC Housing Prices Crater 19% YOY As Debt Crippled Speculators Panic And Inventory Soars Across The Carolinas

    https://www.movoto.com/nc/27606/market-trends/

    As one national broker conceded, “We’ve been scraping the bottom of the buyer barrel for 15 years or more. Why do you think mortgage defaults are 600% higher than long term trend?”

  16. Remember the “Misery Index”? It is the sum of the U.S. inflation rate and the unemployment rate. It was at its highest in 1980, when it reached 21.98%. Before the reaction to COVID-19, the index was at 5.939% (March, 2020). It peaked at 15.03% in April, 2020, and declined to 8.062% by December, 2020.
    There has been a gradual increase since then. In May, 2022, the index was at 12.18%. June saw the index increase to 12.66%

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