thehousingbubble@gmail.com
Blog

The Story Is That Demand Is Just Gone, Those Investors Made Losses On Their Properties

It’s Friday desk clearing time for this blogger. “A bond rating agency’s downgrade of U.S. government debt roiled markets — and created just one more reason for mortgage rates to stay firmly near their highest level in two decades. ‘That is not good news,’ National Association of Realtors Chief Economist Lawrence Yun said. ‘That is going to make the mortgage rate a little higher.’ ‘This could have serious consequences,’ says Dick Lepre, a loan agent at CrossCountry Mortgage in Alamo, California.”

“According to Redfin, the median sale price of a starter home in San Francisco decreased 13.3% to $910,000; in Austin, decreased 12.2% to $347,300; and in Phoenix, decreased 9.7% to $325,000. ‘With mortgage rates being so high, not as many people are making that decision to buy a home in San Francisco right now,’ said Sheharyar Bokhari, a senior economist with Redfin. ‘I think the story there is that demand is just gone. There were a lot of iBuyers in Phoenix and when rates went up, those investors made losses on their properties,’ he said. As demand falls and interest rates remain high, those investors are trying to reduce their presence in the market, which has helped to bring prices back down.”

“Redfin shares dropped more than 10% in after-hours trading Thursday after the company reported a 21% drop in revenue as it continues to face headwinds from a slumping housing market. ‘Sales volume is near rock bottom,’ Redfin CEO Glenn Kelman said on a call with analysts.”

“On the bottom line for the second quarter, Zillow Group posted a net loss of $35 million, vs. a profit of $8 million in the same quarter a year ago, as calculated using Generally Accepted Accounting Principles (GAAP).”

“July was another slow month for the housing market in the Denver metro area, according to the Denver Metro Association of Realtors. Denver Realtor and DMAR Markets Trends Committee Chair Libby Levinson-Katz said in the report that seller concessions have increased in the current home buying climate, where activity from buyers remains slow. Seller concessions have gone up from 29.2% last June to 48% this June to an average of $7,295. In addition, the close-price-to-list-price ratio dropped below 100% in July. ‘This may be the best time to buy in recent history as buyers can finally negotiate after enduring years of a strong seller’s market,’ Levinson-Katz said.”

“‘Realtors and their clients must take a deep breath, relax and expect both buying and selling to take longer than in recent months and return to pre-pandemic normalcy,’ Denver Realtor Susan Thayer said in the report. DMAR includes data from the counties of Adams, Arapahoe, Boulder, Broomfield, Clear Creek, Denver, Douglas, Elbert, Gilpin, Jefferson and Park in its monthly reports.”

“Home prices are continuing to decline in Liberty Hill and Leander, and homes are sitting on the market longer compared to last June, according to Austin Board of Realtors data. In June, the median price of homes in Leander was $483,400 compared to $511,185 last year in June, which is a 5.4% decrease, ABoR data shows. The median home price in Liberty Hill was $471,645 in June—a 9.5% decrease compared to $521,035 in June 2022. Additionally, homes are sitting on the market longer in both cities. ‘It is important to remember that the market continues to moderate in the wake of unsustainable price growth and sales activity during the pandemic, but remains robust,’ ​​ABoR Housing Economist Clare Losey said.”

“Despite strength in occupancy and sales at its core malls, PREIT’s financial situation — and its relationship with shareholders — continues to deteriorate. The Philadelphia-based mall REIT lost $9.73 per share in Q2, nearly triple what it lost in the same period last year, according to its quarterly report. ‘Right now, I think we’re dealing with PREIT rearranging the deck chairs on the Titanic,’ longtime PREIT analyst Sheldon Grodsky told Bisnow after the earnings release. ‘I think the board includes some very knowledgeable and good people, but they’re in a situation that may have no good way out for them.'”

“Private investor Scott Bishins, who co-authored a July 6 letter calling on the seven board members to resign, told Bisnow at the time that PREIT’s lack of detailed communication about its refinancing efforts was the source of his frustration. For retiree and shareholder Claire Pare, the issue is one of priorities. ‘In my opinion, PREIT’s management doesn’t appreciate the fact that many retirees are in part dependent on the dividends,’ Pare told Bisnow. ‘And I think they’re being very … it’s very unfair to ignore that fact.'”

“Amid a South Beach retail slump, Northeast investors bought a Collins Avenue building at a deep discount, with plans for a Michelin-starred chef to open a restaurant at the long-vacant site. Garfield and Rebecca Spencer bought the two-story building at 624 Collins Avenue in Miami Beach for $6 million, or 75 percent less than the property’s sale price seven years ago, according to the broker and records. South Beach’s heyday as a high-fashion retail hub is long gone, leaving Collins Avenue riddled with vacant storefronts. In January, Shire Realty sold the mostly vacant building at 826 Collins Avenue for $5 million, or a 41 percent discount from the property’s price tag a decade ago.”

“Downtown Toronto’s office hub has become a tenant’s market, as more businesses try to get rid of space, pushing the real cost of rent down. Tenants and commercial real estate brokers agree that rent has gone way down, as landlords offer inducements that effectively reduce the headline rent number. ‘Landlords don’t want to reveal the discounts and incentives they may need to use to lure in tenants, especially in tenant market situations like today,’ said Carl Gomez, chief economist with CoStar Group. One financial services firm negotiated its lease in 2021 and estimates that it is paying 30 per cent less than it would have had it negotiated its lease in 2019. Because of the glut of available space, landlords are offering other incentives to lure tenants. The result is that renters are finding better deals than they’ve seen in years.”

“The Quebec government and short-term rental platforms, such as Airbnb, are at odds over how to identify illegal listings as the deadline approaches for the companies to comply with provincial law. The new regulation is part of a crackdown on illegal tourist accommodations after a March fire in an Old Montreal building that killed seven people, six of whom were staying in unlicensed short-term rentals. But three months is simply not enough time, said Dany Papineau, CEO of WeChalet, a Montreal-based short-term rental startup with 2,200 listings.”

“‘We’re definitely not prepared,’ he said. ‘It’s a bit like if you ask (the) Titanic … to stop right away at a stop light and turn right on the spot. It’s simply impossible.’ Papineau said such fines could be detrimental to his business as it continues to grow. ‘It’s really like putting a gun in your face,’ he said.”

“A South Australian construction company has been stripped of its licence after more than a dozen complaints of substantial delays and shoddy workmanship. About 27 properties with builder 7 Star Construction have been left without a completion date, with homeowners saying they have been left in the dark about the future of their ‘dream home.’ Zara Sanders picked 7 Star to build her home, but three years on, she says the experience has been a nightmare. ‘A year and a half in, that’s when the neighbours all collectively started to communicate to each other and we realised we’ve really got some problems here,’ she told 7NEWS.”

“7 Star owner Qamil Veseli told 7NEWS he sympathised with his customers, blaming out of control prices that have put him under pressure. ‘I feel so bad for them,’ he said. ‘Everything has gone out of control. At the moment, we’re under big pressure.'”

“Auckland house sales fell nearly $1000 a day, if the average sale price drop by the city’s largest real estate agency is anything to go by. Barfoot & Thompson reported June’s average sale house price was $1.097 million but in July that dropped to just $1.067m, indicating prices were down by $994 a day from one month to the next. Peter Thompson, the agency’s managing director, said nothing unusual was happening because it was the traditional winter lull. ‘The Auckland housing market once again showed a consistency in line with traditional seasonal expectations during July with sales numbers up on previous months, but prices falling back a little,’ he said.”

Related Posts
This Post Has 110 Comments

    1. The Federalist — Jack Smith’s Jan 6. Indictments Are An Attack On Political Speech (8/3/2023):

      “Though numerous commentators who have an aversion to Trump have pointed out the weakness of the indictments, it’s quite telling how little media-approved historians and legal “experts” even bother defending the underlying legal case. Trump is evil, a threat to “democracy,” and really what else is there to discuss? In the Trump-addled politics of our age, it is virtually impossible for either side to compartmentalize the process and the person if that person happens to be Trump.

      In this case, the precedent would criminalize and chill political speech. People keep assuring me the indictments aren’t really about the expression but rather about defrauding the government. Sorry, the entire case is predicated on the things Trump said or believed or didn’t say or didn’t believe. All of it should be protected under the First Amendment. “Spreading lies” — prosecutors leaned on the thesaurus hard, finding about two dozen ways of repeating this fact — or entertaining theories offered by crackpot lawyers, or trying to convince faithless electors to do things that people have been trying to convince faithless electors to do for a long time, are all unethical, not criminal.

      Nowhere do the indictments come anywhere in the vicinity of making the case that Trump incited “imminent lawless action” on Jan 6. At least no more than, say, the entire Democratic Party had a hand in inciting the 2020 Black Lives Matter riots — the most destructive in American history.”

      https://thefederalist.com/2023/08/03/jack-smiths-jan-6-indictments-are-an-attack-on-political-speech/

      1. Don’t keep real close tabs on the whole Trump thing , but I do think the D’s and almost half the population, especially the entitled non-workers ,and most ,though not all of the 13% bunch,,have the goal of destroying our Country as it is now, somehow hoping they’ll come out ahead ….

      2. “…the entire Democratic Party had a hand in inciting the 2020 Black Lives Matter riots…”

        Hopefully this is remembered during the election season.

  2. ‘For retiree and shareholder Claire Pare, the issue is one of priorities. ‘In my opinion, PREIT’s management doesn’t appreciate the fact that many retirees are in part dependent on the dividends,’ Pare told Bisnow. ‘And I think they’re being very … it’s very unfair to ignore that fact’

    Good morning boss.

    Good morning Claire, better get those shopping carts inside before it gets hot.

    1. Claire thinks “fairness” has anything to do with business decisions by private equity bloodsuckers? That’s adorable.

    2. Clare never read the prospectus. If she did, it would clearly state “heads I win, tails you lose.”

  3. ‘We’re definitely not prepared,’ he said. ‘It’s a bit like if you ask (the) Titanic … to stop right away at a stop light and turn right on the spot. It’s simply impossible.’ Papineau said such fines could be detrimental to his business as it continues to grow. ‘It’s really like putting a gun in your face’

    But Dany, it’s only 2200 loans?

  4. ‘bought the two-story building at 624 Collins Avenue in Miami Beach for $6 million, or 75 percent less than the property’s sale price seven years ago, according to the broker and records. South Beach’s heyday as a high-fashion retail hub is long gone, leaving Collins Avenue riddled with vacant storefronts’

    How the mighty have fallen.

    1. At least it’s strategically located if you get food poisoning. According to Google Maps, 624 Collins Ave is directly across the street from the Dade County Health Department. I imagine that neighborhood is quite eclectic.

  5. Mass Formation Psychosis.

    MSNBC medical contributor tells Americans to start wearing masks again after uptick in COVID hospitalizations (8/2/2023):

    “A doctor appearing on MSNBC Tuesday said that Americans should start wearing masks for COVID again.

    Former Obama official and current MSNBC medical contributor Dr. Kavita Patel was brought on Jose Diaz-Balart Reports to discuss an uptick in COVID hospitalizations.

    “If you’ve noticed more of your friends, neighbors, loved ones are testing positive for COVID, you’re not alone. According to the CDC, COVID-19 hospitalizations are up 12 percent from last week and, while we’re nowhere near previous levels, it’s still raising concerns,” Diaz-Balart said.

    “So, what I think people need to know is that, I would just keep people on alert that when you’re in those crowded spaces, think about the cough and the colds, and sometimes many people don’t even have any symptoms,” Patel said.

    Furthermore, Patel said that masks should be brought back after the uptick in COVID hospitalizations.

    She said, “A mask can be your best friend. Keep it – Back in time, we had them in our office, in our coats, and our backpacks. Time to bring them out again.

    https://www.foxnews.com/media/msnbc-medical-contributor-tells-americans-start-wearing-masks-uptick-covid-hospitalizations

    I just refused to ride in an elevator with some clown wearing a mask. This NPC is probably on his eighth booster shot and spike protein shedding monkeypox and A.I.D.S. out of every pore of his body.

    1. Over 100 colleges still have COVID vaccine requirements ahead of 2023 school year (8/1/2023):

      “Over 100 colleges and universities require their students to be vaccinated for COVID-19 in order to attend classes, according to data compiled by a college advocacy organization.

      Of the more than 1,200 four-year schools measured, 101 academic institutions across 19 states currently have mandates in place for the coming academic year. Among them are notable names such as Harvard University, Johns Hopkins University and Rutgers University.

      No College Mandates, who compiled the information, describes itself as a “group of concerned parents, doctors, nurses, professors, students and other college stakeholders working towards the common goal of ending COVID-19 vaccine mandates.”

      Their reasoning for compiling the data, NCM said, was to provide assistance to incoming students and families seeking to navigate the college decision process as well as healthcare needs.

      “[This document’s] purpose is to assist families in the college search and to provide a bird’s-eye view of COVID vaccine policies,” NCM said.

      https://abcnews4.com/news/nation-world/over-100-colleges-still-have-covid-vaccine-requirements-ahead-of-2023-school-year-report-says-johns-hopkins-harvard-rutgers-coronavirus-pandemic-vax-health-sickness

    2. If you’ve noticed more of your friends, neighbors, loved ones are testing positive for COVID, you’re not alone

      I don’t know of anyone testing positive. What a crock.

      1. I was texting my financial advisor last night and he said that he just had 2 friends die this week and that “I have high school, college, friends around town and colleagues dropping like flies.” When I asked what from, he said cancer, bad anesthesiologist, pneumonia and heart attack.

          1. Social Security outlays have decreased and there’s a shortage of workers while SSDI has increased. What happened to those people? I’m sure they will blame covid or global warming

          2. global warming

            I read that it’s hot in Equatorial S. America, despite it being winter. Hot near the equator, that’s amazing.

          3. IMO the excess deaths are already under-reported. I recall there was a big story last year about life insurance companies facing massive payouts due to higher than anticipated deaths. Nothing.
            It will be interesting to see data from other countries such as Israel, the most covid vaccinated country.

          4. global warming

            I’ve been binge-watching cut flower gardening and almost every YT channel buys into this crap.

          5. almost every YT channel buys into this crap

            A lot of people are being paid to be shills, beyond the usual suspects.

            Meanwhile the EPA is doing its best to regulate as many refineries out of business as possible. The SunCor refinery in Dumver’s days are numbered. Once they shut it down prices on the front range will sky rocket.

  6. “According to Redfin, the median sale price of a starter home in San Francisco decreased 13.3% to $910,000; in Austin, decreased 12.2% to $347,300; and in Phoenix, decreased 9.7% to $325,000.”

    13.3% doesn’t sound too bad. But what is that home equity loss in dollar terms*?

    “‘With mortgage rates being so high, not as many people are making that decision to buy a home in San Francisco right now,’ said Sheharyar Bokhari, a senior economist with Redfin.”

    Unfortunately, virtually no entry level buyer can afford a $900,000+ starter home with a 7%+ mortgage. Shit on the sidewalks and junkies living in the streets isn’t helping demand, either.

    “‘I think the story there is that demand is just gone.”

    I think the story there is that home equity is just gone.

    1. * 13.3% equals L / ($910,000+L) where L = the dollar amount of loss.

      After algebra, L = 0.133 × $910,000 ÷ (1-0.133) = $139,600, a loss bigger than a San Francisco starter job salary.

      The implied original value is $910,000 + $139,600 = $1,049,600.

      Check: $139,600 / $1,049,600 = 13.3%.

      Yep, the math checks out: San Francisco real estate investors are losing buckets of money by the $100,000s.

    2. Average 30-year fixed mortgage rate: 7.322% APR

      Compare current mortgage rates

      Accurate as of 08/04/2023.
      Product Interest rate APR
      30-year fixed-rate 7.236% 7.322%
      20-year fixed-rate 7.119% 7.215%
      15-year fixed-rate 6.205% 6.388%
      10-year fixed-rate 6.260% 6.532%
      7-year ARM 7.619% 7.933%
      5-year ARM 7.441% 7.891%
      3-year ARM 6.125% 7.204%
      30-year fixed-rate FHA 6.387% 7.243%
      30-year fixed-rate VA 6.531% 6.817%
      …
      On Friday, August 4th, 2023, the average APR on a 30-year fixed-rate mortgage rose 1 basis point to 7.322%. The average APR on a 15-year fixed-rate mortgage rose 4 basis points to 6.388% and the average APR for a 5-year adjustable-rate mortgage (ARM) rose 2 basis points to 7.891%, according to rates provided to NerdWallet by Zillow. The 30-year fixed-rate mortgage is 35 basis points higher than one week ago and 193 basis points higher than one year ago.

      A basis point is one one-hundredth of one percent. Rates are expressed as annual percentage rate, or APR.
      …
      https://www.nerdwallet.com/mortgages/mortgage-rates

      1. REAL ESTATE
        Here’s how much cash you may have in your home, thanks to new record high prices
        PUBLISHED FRI, AUG 4 2023 12:30 PM EDT
        UPDATED 6 HOURS AGO
        Diana Olick
        Home prices are on a tear again across much of the nation, giving back to homeowners the equity they lost last year.

        Home prices in June hit record highs in 60% of U.S. markets, according to a new report from Black Knight, set to be released Monday.

        Home equity levels are now back to within 3% of last year’s peaks.
        Per homeowner, that amounts to roughly $200,000 in cash sitting in the house.
        …
        https://www.cnbc.com/2023/08/04/record-high-home-prices-mean-you-may-have-cash-hidden-in-your-home.html

    2. Dude, take a breath before you have a stroke…..and stop watching the news….all of them. They are all tabloids!

      2. They always tell us what they have planned for us. They told us a pandemic was coming during Trump’s presidency and lo and behold

        1. It’s difficult to imagine anyone knowingly letting the covid genie out of the bottle because of the orange man.

          1. Then you must not be paying attention to the globalist Marxist Luciferian World Economic Forum and its one world government agenda.

          2. Yep, you’re right. I can understand corruption happening at all levels, but vast conspiracies rely on widespread cooperation that I don’t believe exists particularly among hustlers. I see it sort of like “Reservoir Dogs,” no cooperation among thieves.

          3. What about Jeffrey Epstein and the court system, DOJ, and media hiding the identities of the Epstein Island pedos?

          4. There’s a reason the phrase “conspiracy theorist” has been weaponized. The phrase originates from JFK’s assassination and anyone who dared to question the official narrative.

          6. Among a handful of operators the conspiracy can be managed properly, and the media et al are left speculating without solid facts in the west anyway. My covid belief aligns with the lab leak theory, that daily operations ignored protocol, got too loose and oops, we’re dropping like flies. Our planet has a large land surface area with lots of independent players that I don’t believe can be controlled, maybe exterminated, but not controlled.

            The Epstein case and evidence had a bag dropped over it by a handful of deep state operators who control the government’s agencies and bureaus, but eventually the details will be leaked. I’m sure there are numerous honest law enforcement employees who would love to take-down Hunter Biden, but their careers are at stake, so there’s an epidemic of cowardice for now.

          7. lab leak theory

            Assuming it leaked, you should still question why they were engaged in gain-of-function research and why our taxpayer dollars were being used to do it in Wuhan. It’s biowarfare.

          8. Agreed. I never thought it was a naturally occurring virus, and this sort of lab should be located in an isolated and controlled area such as Dugway Proving Grounds.

          9. this sort of lab should be located

            There are no points of the compass where a biowarfare lab should be located. That’s why it is illegal. Fauci is a war criminal.

          10. you should still question why they were engaged in gain-of-function research and why our taxpayer dollars were being used to do it in Wuhan

            Hubris. Arrogance. There are scientists like Fauci who feel that they are smarter than anyone else. Research that can’t be done legally here is done overseas in “collaboration” with U.S. researchers. It’s a way of getting around pesky rules. In this country, there are really strict rules and regulations and review boards for every single funded (and unfunded) type of research. You can’t even go out and do a simple questionnaire on anything without first getting an IRB approval.

            One reason why Fauci and his cronies were doing the gain of function and related research is that they wanted to make a big discovery. You have to understand that fame and prestige is everything to ALL researchers. And since they are smarter than anyone else, they know how to do things “safely”. Yeah right…..

            And so they use foreign labs to do their dirty work since foreign countries frequently don’t have such strict rules. There are all kinds of collaborations going on all the time. With this Covid-19, things just got out of control–these clowns didn’t know what they were doing.

            I think it’s that simple. It’s like the two Space Shuttles that NASA blew-up killing all those astronauts. The reasons were dirt simple, but even today the NASA explanations require a PhD in physics to understand.

    3. So, how soon until the first true 15 minute cities appear in Europe? By 2030? Sooner?

      I do think that it will take some more propaganda to scare the lemmings into demanding 15 minute cities in the EU. Of course, migrants and vibrants will be exempted and allowed to roam freely without needing permission, because reasons.

      1. Violation will result in loss of employment. The vibrants and migrants are on welfare, so it won’t affect them.

  8. ‘Sales volume is near rock bottom,’ Redfin CEO Glenn Kelman said on a call with analysts.”

    Better get to sawin’ and slashin’ if you want to offload those alligators, greedheads.

  9. ‘This may be the best time to buy in recent history as buyers can finally negotiate after enduring years of a strong seller’s market,’ Levinson-Katz said.”</em

    Thanks for the "advice," REIC shill, but the real cratering hasn't even begun yet.

  10. ‘This may be the best time to buy in recent history as buyers can finally negotiate after enduring years of a strong seller’s market,’

    Libby is a trickster. Notice she didn’t say what it was the “best time” for. Because unless she’s been recently lobotomized, even Libby knows it’s the “best time” to receive the worst a$$ pounding, not only in “recent history”, but of a generation.

    1. “Always be closing” is what drives Libby, not fiduciary concern for her “clients.”

  11. ‘It is important to remember that the market continues to moderate in the wake of unsustainable price growth and sales activity during the pandemic, but remains robust,’ ​​ABoR Housing Economist Clare Losey said.”

    Buying into the pandemic-era housing bubble inflated by $4 trillion in Yellen Bux funny money pumped into the financial system would be a colossal mistake, said no realtor ever.

  12. “‘Realtors and their clients must take a deep breath, relax and expect both buying and selling to take longer than in recent months and return to pre-pandemic normalcy,’ Denver Realtor Susan Thayer said in the report.

    You keep using that word “normalcy,” REIT shills. I don’t think crater and “return to normalcy” are synonymous.

  13. In January, Shire Realty sold the mostly vacant building at 826 Collins Avenue for $5 million, or a 41 percent discount from the property’s price tag a decade ago.”

    Gosh, that’s getting perilously close to the 50% haircuts we were assured were un-possible.

  14. “‘We’re definitely not prepared,’ he said. ‘It’s a bit like if you ask (the) Titanic … to stop right away at a stop light and turn right on the spot. It’s simply impossible.’

    Dies, speculator scum.

  15. A reader sent these in:

    Bloomberg’s entire programming today has been “Soft Landing” segments… Probably a warning sign.

    https://twitter.com/FinanceLancelot/status/1686033519821123584

    Foreign Purchases of U.S. Homes Slump

    https://twitter.com/DeItaone/status/1686626586160750592

    US state and local governments just experienced the worst decline in income tax revenues ever recorded.

    This was the second steepest year-over-year percentage decline in history, with only the GFC having a worse outcome. Note that Federal tax receipts are also dropped again, now at recessionary levels and approaching -10% on a YoY basis. This is a clear indication of the continued fundamental deterioration of the economy, which sharply contrasts with overall financial assets that remain at excessively inflated valuations.

    https://twitter.com/TaviCosta/status/1686587577510547457

    Delinquencies are on the rise across the board BEFORE they start repaying student loans

    https://twitter.com/INArteCarloDoss/status/1686650400747708416

    FITCH DOWNGRADES FANNIE MAE, FREDDIE MAC AFTER US RATING CUTMortgage Back Securities are on the verge of crashing taking out the March all time low
    These #Bonds are AAA 😳

    https://twitter.com/GregCrennan/status/1686891557419712512

    “Lenders expectations in terms of rejection levels in the next few months will take out the records for the Great Financial Crisis.”

    https://twitter.com/DiMartinoBooth/status/1687055714697539584

    “With 64 bankruptcies in the month of July, U.S. corporate bankruptcies rose to a year-to-date level of 402, the second-highest year-to-date total since 2010, according to data released Thursday by @SPGMarketIntel

    https://twitter.com/DiMartinoBooth/status/1687127688106934272

    I think the main problem is the prices, not the rate. I am also not your typical Fintwit person.

    https://twitter.com/RudyHavenstein/status/1687278756862558208

    Does anyone even watch cable TV news or read newspapers like the NYT and Washington Post any more?

    https://twitter.com/WallStreetSilv/status/1687040618063888385

    “Housing isn’t a primary federal responsibility” – Justin Trudeau
    But 2SLGBTQWTF+ is a primary federal responsibility? 🤡 🌎

    https://twitter.com/WallStreetSilv/status/1687028619304984576

    NYC is going to let tens of thousands of illegal fake “asylum” seekers camp in Central Park. What do you think? Ready to send them back yet NYC?

    https://twitter.com/WallStreetSilv/status/1686926745411137536

    US housing units per capita continue to move vertically, far surpassing the previous ATH set amid the “housing bubble” of 2008. There was/is no shortage of physical shelter, just a massive surplus of $’s that needed a “home”. This bubble has been engineered to draw in every US citizen…and the pain will be felt by everyone. And of course, the only entity that will be able to “save” everyone, is the same entity that created this fiasco.

    https://twitter.com/Econimica/status/1686999658483314688

    Used cars are aging on dealer lots: 46% of the cars listed on Cars(.)com have been listed for over 45 days. Healthy inventories should have <5% of cars listed over 45 days old.

    https://twitter.com/GuyDealership/status/1687083451080454145

    American households are earning $121 billion more in investment interest income versus a year ago but are paying $151 billion more in interest on mortgages, credit cards and other loans.

    https://twitter.com/charliebilello/status/1687219518215458816

    Assets in money market funds have hit a record $5.5 trillion. With yields above 5%, this trend should continue.

    https://twitter.com/charliebilello/status/1687218625948557312

    The median home price in the Miami–Fort Lauderdale–West Palm Beach metro area is now 8.7x higher than the median income, up from 3.1x in 1990 and above the 2005 bubble peak (8.5x).

    https://twitter.com/charliebilello/status/1687152418096553985

    The median price of a starter home in the US is 46% higher than 2019 levels. The monthly mortgage payment needed to purchase one of these homes has more than doubled over that time period.

    https://twitter.com/charliebilello/status/1687113442984108032

    It’s increasingly obvious that this bull market bubble is not so much about all the spurious narratives flying around (AI, resilient growth, goldilocks, etc…) as much as it is a sovereign bubble. Yellen is clearly micro-managing liquidity at a cost to US taxpayers to avoid volatility while Bidenomics are supporting spending beyond any fiscal prudence. That’s the hard truth. And that bubble is starting to crack.

    https://twitter.com/INArteCarloDoss/status/1687087370837835776

    BOJ ANNOUNCES UNSCHEDULED BOND-BUYING FOR SECOND TIME THIS WEEK

    https://twitter.com/zerohedge/status/1686951163990528001

    Look who jumped to defend the U.S. government against Fitch’s credit rating downgrade. All of these guys are the top paid shills 🤣

    https://twitter.com/FinanceLancelot/status/1686955486132748288

    1. “These #Bonds are AAA 😳”

      Any of this sound familiar? But, of course, it’s different this time.

    3. “Bloomberg’s entire programming today has been “Soft Landing” segments… Probably a warning sign.”

      – vs.

      “Delinquencies are on the rise across the board BEFORE they start repaying student loans”

      “US state and local governments just experienced the worst decline in income tax revenues ever recorded.”

      “This was the second steepest year-over-year percentage decline in history, with only the GFC having a worse outcome. Note that Federal tax receipts are also dropped again, now at recessionary levels and approaching -10% on a YoY basis. This is a clear indication of the continued fundamental deterioration of the economy, which sharply contrasts with overall financial assets that remain at excessively inflated valuations.”

      “FITCH DOWNGRADES FANNIE MAE, FREDDIE MAC AFTER US RATING CUT Mortgage Back Securities are on the verge of crashing taking out the March all time low
      These #Bonds are AAA 😳”

      “Lenders expectations in terms of rejection levels in the next few months will take out the records for the Great Financial Crisis.”

      “With 64 bankruptcies in the month of July, U.S. corporate bankruptcies rose to a year-to-date level of 402, the second-highest year-to-date total since 2010, according to data released Thursday by @SPGMarketIntel”

      “Used cars are aging on dealer lots: 46% of the cars listed on Cars(.)com have been listed for over 45 days. Healthy inventories should have <5% of cars listed over 45 days old."

      \\

      – There’s clearly a disconnect between Wall St. and Main St. This is not a one-off scenario. There have been several times in history at the end of the market cycle when there’s crowding into the few remaining still winning stonks. Of course the Wall St. sell side/cheerleaders are promoting the “everything is (still) awesome” narrative. Think housing shills and you won’t be far wrong, since the sell side makes a living by selling to the “dumb” money.

      – At some point, the markets and economy will reconnect, but for now it’s still “party on, Garth!”. There’s a lengthy lag between tightening and the eventual market response. Employment is the last domino to fall. I think we’re getting close now. We now have disinflaton (falling rate of inflation), but still at a positive inflation rate. The Fed is going to fight that, in spite of Congress continuing to spend money that we don’t have, which is inflationary. Damn the credit downgrades, full speed ahead!

      – After 13 years of essentially free $ it’s hard for “investors” to accept that the punch bowl has been removed, the music stopped, and the party’s over. As in real life, there’s nothing that will prevent or cure the inevitable hangover. The bigger the boom, the bigger the bust.

      – CRE looks to be fine though… /s

      \\\

      The Market Is Detached From The Real Economy
      By Lance Roberts | August 4, 2023

      “The stock market is not the economy.”

      “Such is the latest rationalization to support the “bull market” narrative. The question, however, is the validity of the statement. During the 2020 economic shutdown and surging market rebound I stated:”

      “There is currently a ‘Great Divide’ happening between the near ‘depressionary’ economy versus a surging bull market in equities. Given the relationship between the two, they both can’t be right.”

      \\

      “Who are you going to believe, me or your own lying eyes?” – Attributed to Groucho Marx, but probably originated from Chico Marx in “Duck Soup,” 1933

      “This is your last chance. After this, there is no turning back. You take the blue pill – the story ends, you wake up in your bed and believe whatever you want to believe. You take the red pill – you stay in Wonderland and I show you how deep the rabbit-hole goes.” – Morpheus, The Matrix, 1999

      1. There’s clearly a disconnect between Wall St. and Main St. This is not a one-off scenario. There have been several times in history at the end of the market cycle when there’s crowding into the few remaining still winning stonks.

        Indeed, engineered so the smarter ones can sell to the dumber ones before the bottom falls out. State of our education and mass-media system ensures an ever-growing base of idiots to convince the good times will roll forever.

    4. “Does anyone even watch cable TV news or read newspapers like the NYT and Washington Post any more?”

      I don’t watch TeeVee. BitChute, Rumble, and some YouTube (yes, Google is evil).

      I read the New York Times (Obama State Department) and Washington Post (CIA) to get my Deep State propaganda straight from the source. Whatever they are advocating for, it is against freedom and the well being of U.S. citizens. They are, as DJT correctly stated, “the enemy of the American people.”

      1. I often wonder why the local TeeVee stations still broadcast local news. Other than the elderly, who watches it? Or anything that is broadcast? IIRC, Disney is floating selling off ABC, to raise cash. But ABC is worthless, in a death spiral. Who would buy it? The big networks are going to end up like Sears and KMart: worthless relics from the past.

        1. “local TeeVee stations”

          I don’t watch the tube, but I read the articles on the Denver7, KDVR, 9News websites for coverage of local crime.

          And read the /r/Denver Reddit threads about those crime articles, which are as predictable as you would expect.

          “They’re not sending their best”

    5. Used cars are aging on dealer lots: 46% of the cars listed on Cars(.)com have been listed for over 45 days.

      Yet the asking prices have not budged. I really don’t get it.

      1. Lowering prices could mean insolvency for the stealerships, who paid too much for their inventory, though if they can’t sell anything they will also go under.

        But yeah, a look on cars dot com still shows stratospheric prices. 10 year old Chevys with 100K+ on the clock asking 50% of what they cost new. Those cars used to be considered beaters, a car you could buy for a few thousand, not $15K

        1. Indeed. Lucky Lopez, one of the few youtube channels I watch, gives good info on this. Dealers are screwed, and they’re slow to want to realize those losses, though once it picks up steam it’ll surpass the GFC.

          1. I’ve been watching F150’s since they’re one of the more popular 1/2 ton trucks. For about 6 months now I’ll go on CarGurus and put “saved” on trucks between 2018 and 2021 with less than 40K miles. Once you hit “saved” then CarGurus will send you a notification every time there’s a price reduction on your saved vehicles, as I’m sure every car buying app does. But the last 30 days or so have seen an big increase in the price reduction notifications on those vehicles. The dam break usually begins with a trickle.

          2. It’s not so much that the dealerships don’t want to take a loss on one car. If they start cutting prices, the banks will notice that they’re insolvent and cut off the LOC. So a slow death it is then.

          3. The dealers operate on a line of credit, and when the loans they write and then discount for sale to the financial markets start going bad, recourse happens. When the dealer is unable to repurchase their bad loans they’re finished, game over. And with the cost of money now roughly doubled, and the Sixpack car buyers increasingly unable to qualify, many of these dealers are like the stars in the night sky—already dead, but you can still see the light. On the bright side, I fully expect the auto industry will be bailed-out, again. It is simply too large with a vast number of third party suppliers. Letting them go would be like tossing a football into the room with thousands of dominos lined-up. The ripple effect might topple an already fragile debt laden economy.

  16. ‘A year and a half in, that’s when the neighbours all collectively started to communicate to each other and we realised we’ve really got some problems here,’ she told 7NEWS.”

    Call it a hunch, call it an intuition, but I’d say yer well & truly buggered, Zara & fellow bagholders.

  17. “Auckland house sales fell nearly $1000 a day, if the average sale price drop by the city’s largest real estate agency is anything to go by.”

    That does not compute.

  18. seems to be an endless amount of construction firms going under down under.

    and an infinite anount of victims

    mind boggling

  19. Toronto Real Estate Prices SLIDE in July: Correction Speeding Up
    Mark Mitchell – Mortgage Broker London Ontario
    Aug 4, 2023

    Toronto’s real estate prices saw their first major decrease in 2023 in July, with the benchmark, average and median prices all dropping substantially. The real estate correction is off to a faster start that we saw in 2022, with prices falling faster than they did in March of 2022.

    https://www.youtube.com/watch?v=6swXPTCStl0

    7:42.

  21. Reasonably priced for a remodeled house. However, at the end of the day, its still a small 75 year old wood house in a declining Pensacola, FL neighborhood. On the plus side, the neighbor runs a massage business out of their house. In that neighborhood, massage may have multiple meanings.

    https://www.zillow.com/homedetails/27-Flynn-Dr-Perdido-Key-FL-32507/44675426_zpid/

    The previous listed and sold prices show how painful of a stomach punch the previous bubble pop was to the local market. Also, how the current bubble is affecting sellers current wish prices. You can practically hear the air going out of the bubble on this one by viewing the price reductions.

    Date Event Price
    8/4/2023 Price change $139,900
    7/29/2023 Listed for sale $144,900
    6/24/2023 Listed for sale $154,900
    6/5/2023 Price change $159,900
    5/27/2023 Price change $164,900
    5/12/2023 Price change $169,900
    4/28/2023 Price change $174,900
    4/12/2023 Price change $179,900
    3/20/2023 Price change $184,900
    3/18/2023 Listed for sale $174,900
    12/29/2016 Sold $34,000
    10/11/2007 Sold $30,000

  22. Ben, are you going to do any more get-togethers like during the last bubble bust? I live in AZ now, so curious if that’s on anyone’s radar.

  23. Today’s interesting find: Paul & Daisy Soros Fellow Vivek Ramaswamy’s Roivant Sciences Develops Clinical Stage Antibody to Prevent and Treat Acute Respiratory Distress Syndrome (ARDS) in Patients with COVID-19

    After Harvard college, Vivek worked for three years in life sciences investing in New York before pursuing his law degree at Yale Law School.

    Founded in 2014, Roivant is parent to a family of subsidiary companies focused on rescuing drugs that have been through initial testing and abandoned by other drug companies. Roivant works with other pharmaceutical companies and universities to complete testing and development.

      2. I stopped watching Fox News last November/December. The globalist anti-Trump Murdochs were pushing Vivek back then. I’ve never liked him.

  24. Are you a used home investor fraudulently masquerading as an owner-occupant?

    Here’s to hoping the Fed’s rate hike campaign delivers you massive losses and sends you packing.

    1. The Economist
      Finance and economics | Buttonwood
      Meet America’s disguised property investors
      They do not live in the homes they have bet on. Can they live with the bets they have made?
      Satoshi Kambayashi
      Aug 3rd 2023

      Who really bought the house next door? In America purchasers of residential property typically fall into two categories. First are the owner-occupiers, buying a home and hearth where they can live out their white-picket-fence American dreams. The rest are investors of various kinds. They may be flippers, looking to spruce up an old home and sell it on. They could be buy-to-let landlords acquiring a property to rent it out. Or they could be pure speculators, more interested in betting on prices than collecting rent.

      Owner-occupiers have traditionally dominated the market. For most of the decade to 2020 only a sixth of house purchases were made by investors, according to Redfin, a property platform. But their presence is growing. By 2022 the investor share was closer to a fifth.

      And their numbers may be far greater than reported, according to a recent working paper from the Federal Reserve Bank of Philadelphia, written by Ronel Elul, Aaron Payne and Sebastian Tilson. The reason is occupancy fraud. When applying for a mortgage, some buyers say they will live in the home they intend to purchase. But then they never move in. These phoney owner-occupiers are investors in disguise.

      Why might an investor indulge in this kind of masquerade? Their motives are easy enough to understand. Homeowners who live in their houses often get much better deals on their mortgages. The perks can include gentler interest rates, lower fees and smaller downpayments.

      To sniff out fraudulent borrowers, the researchers looked at three kinds of data. In a database of mortgage loans, they identified borrowers who said they planned to be owner-occupiers. Then they looked at those who have more than one “first lien” mortgage, ie the primary loan taken out on a property. (Mortgages for second homes or investment properties are classified differently.) Finally, they used address data gathered by credit bureaus to look for those who did not move within a year of obtaining a new mortgage.

      The authors define fraudulent borrowers as those who trip all three measures: they say they will move to the new property, they take out a second owner-occupier mortgage and then they never move. Once these disguised investors are added back in, the pool of mortgage-backed investors is 50% larger than commonly measured. That, in turn, suggests that total investors’ share of home purchases could be 20% higher than previously thought.

      This finding raises three potential concerns. First, it implies that investors are more influential in the market than they appear. People are wont to blame rootless speculators for America’s rapid house-price rises. A common rebuttal is to point out that investors still represent a relatively small share of purchases. But that defence is weakened if many speculators are going uncounted.
      …
      https://www.economist.com/finance-and-economics/2023/08/03/meet-americas-disguised-property-investors

  25. It’s the end of the work week for most of you cattle tax slaves. Where has your taxpayer money gone?

    Antiwar — No Breakthroughs For Ukrainian Forces In Counteroffensive (8/2/2023):

    “Ukrainian forces have still made no breakthroughs against Russian forces in the counteroffensive despite sending thousands of more troops to the front for a renewed push in the southeast, POLITICO reported Tuesday, citing unnamed Pentagon officials.

    US officials said last week that the “main thrust” of the Ukrainian counteroffensive had begun and that Ukraine committed NATO-trained forces it was holding in reserve. The push was focused on Zaporizhzhia, and the idea was to sever the land bridge Russia has secured to Crimea, and there have been attacks in other areas along the front.

    The POLITICO report said that Ukraine committed 150,000 troops to the assault along three axes of attack, but Pentagon officials said the operations have not yielded significant results, with one saying Ukrainian gains are being measured by the hundreds of meters.

    “They are making mostly small, incremental gains,” one official said. “They are still facing stiff Russian resistance — second and third layers of defenses.” The report said Ukraine is still keeping some forces in reserves.

    The Wall Street Journal recently reported that Western officials didn’t believe Ukraine had enough weapons or training to dislodge Russian forces but hoped they would be able to break through anyway.

    In the lead-up to the counteroffensive, the Discord leaks and other media reports showed that the US did not believe Ukraine could regain significant territory. But the Biden administration still pushed for the assault and rejected the idea of a ceasefire.”

    https://news.antiwar.com/2023/08/02/no-breakthroughs-for-ukrainian-forces-in-counteroffensive/

    War pigs gonna pig.

    1. Russia Today — Most Americans believe US has done enough for Ukraine (8/4/2023):

      “A majority of Americans believe the US has done enough to support Ukraine in its ongoing conflict with Russia and would argue against allocating more funds for the country, a new survey by pollster Social Science-Research Solutions (SSRS) and commissioned by CNN, shows.

      The survey was conducted in July, sampling the opinions of some 1,279 respondents randomly selected from among US households. The poll indicated that only 48% of respondents believe the US should do more to support Kiev, while a slim majority of 51% said the country has already done enough.

      The outcome of the survey drastically differed from the outcome of a poll conducted by SSRS in the early days of the conflict in February 2022. Back then, when some 62% of respondents believed Washington should do more to prop up Ukraine, while the rest said it had done enough already.”

      https://www.rt.com/news/580829-americans-ukraine-aid-poll/

      Russia is winning.

  26. ‘Realtors and their clients must take a deep breath, relax and expect both buying and selling to take longer than in recent months and return to pre-pandemic normalcy’

    via GIPHY

  27. ‘But three months is simply not enough time, said Dany Papineau, CEO of WeChalet, a Montreal-based short-term rental startup with 2,200 listings ‘We’re definitely not prepared,’ he said. ‘It’s a bit like if you ask (the) Titanic … to stop right away at a stop light and turn right on the spot. It’s simply impossible.’ Papineau said such fines could be detrimental to his business as it continues to grow. ‘It’s really like putting a gun in your face’

    What Dany is saying here: we have a sh$tload of STR’s and no capacity to meet safety standards.

  28. ‘three years on, she says the experience has been a nightmare. ‘A year and a half in, that’s when the neighbours all collectively started to communicate to each other and we realised we’ve really got some problems here’

    So it took social media a year and a half to discover they were fooked.

    How did you lose yer shack Pete?

    The Auckland housing market once again showed a consistency in line with traditional seasonal expectations during July with sales numbers up on previous months, but prices falling back a little.

    2. As one who got to stare down the mandate gun barrel and was about 2 weeks from losing my job and was only spared because the two mandates that affected my employer were overturned by judges, my unmodified blood boils over this diabolical lie.

    1. Finance ·Housing
      Housing market head fake? Boise slips back into correction mode after seeing a modest spring price bump
      BYLance Lambert
      August 4, 2023 at 6:57 AM PDT
      Boise home prices are down 11.2% from their May 2022 peak—including a 0.2% decline in June.
      Getty Images

      Boise’s meteoric rise to prominence as a Zoomtown during the pandemic was nothing short of remarkable as remote workers, untethered from traditional office spaces, flocked to the city, driving housing demand to unprecedented heights. The city’s allure, fueled by its relative affordability compared to tech hubs like Seattle and San Francisco, saw local home prices skyrocket 63% from March 2020 to May 2022.
      …
      https://fortune.com/2023/08/04/boise-housing-market-looks-like-a-head-fake-home-price-decline-in-june/

      1. Once vibrant, twice doomed.

        “However, this euphoria was tempered by last year’s rapid hike in mortgage rates, which pushed Boise’s housing market into a correction. The aftermath was a 12.8% drop in Boise home prices between May 2022 and January 2023, according to Freddie Mac. That’s a reminder that even the most vibrant markets can be vulnerable to house price declines.

        This spring, that home price correction lost momentum as Boise experienced a 1.9% house price uptick from January to May 2023. Yet beneath that rebound lies a debate: Is the spring price gain a sign of genuine recovery, or simply a seasonal head fake? After all, the seasonality of housing, which is seasonally the strongest in the first half of the year, can lead to temporary price jumps, even in markets undergoing corrections.

        The recently published June reading for the Freddie Mac House Price Index suggests that Boise’s spring bounce for existing home prices might indeed be a head fake. According to the repeat sales index, Boise home prices fell 0.2% in June after rising just 0.1% in May.

        Among the nation’s 100 largest housing markets, only three saw month-over-month price declines in June: Austin (-0.1%), Boise (-0.2%), and Honolulu (-0.3%).”

    1. Financeflux | On August 3, 2023
      US Government To Borrow $1,000,000,000,000 in Q3 As Deficit Widens and Debt Servicing Costs Shatter 11-Year High: Treasury Estimate
      By Alex Richardson

      The US government is dramatically raising its expectations on how much capital it needs to borrow this quarter amid a growing fiscal deficit and dwindling cash reserves.

      The Treasury Department says it has increased its Q3 borrowing estimate to $1.007 trillion, significantly higher than its prior May estimate of $733 billion.
      …
      https://dailyhodl.com/2023/08/03/us-government-to-borrow-1000000000000-in-q3-as-deficit-widens-and-debt-servicing-costs-shatter-11-year-high-treasury-estimate/amp/

Comments are closed.