patrick.net

Nothing new there many of us have been saying this for a year. But well stated.
The housing "recovery" from day one has been characterized by low demand,low interest rates, low new home construction, low new home sales, low existing home sales, low labor participation rate, lower home ownership rates and lower wages but prices have risen- hence a "recovery"

Will pull up the patnet posting of this
http://smaulgld.com/the-coming-supplydemand-real-estate-inventory-reversal/

smaulgld says

low interest rates,

...and now monitary tightning and higher rates will be the final nail in the coffin

Bubbabear says

smaulgld says

low interest rates,

...and now monitary tightning and higher rates will be the final nail in the coffin

Exactly if we didnt have a recovery with $4 trillion in QE how is the recovery going to continue with higher rates as the Fed tapers into a recession?

smaulgld says

Bubbabear says

smaulgld says

low interest rates,

...and now monitary tightning and higher rates will be the final nail in the coffin

Exactly if we didnt have a recovery with $4 trillion in QE how is the recovery going to continue with higher rates as the Fed tapers into a recession?

She's was hired to clean house. Old Ben can't handle the criticism of history so he had her do all his dirty work.
http://www.zerohedge.com/news/2014-03-21/citi-warns-bond-bulls-qe-dead-long-live-normalization

Bubbabear says

She's was hired to clean house. Old Ben can't handle the criticism of history so he had her do all his dirty work.

http://www.zerohedge.com/news/2014-03-21/citi-warns-bond-bulls-qe-dead-long-live-normalization

Yep that is why I predicted Bernanke would get a taper or two in before he left so he could pretend he wasn't irresponsible!

smaulgld says

Bubbabear says

smaulgld says

low interest rates,

...and now monitary tightning and higher rates will be the final nail in the coffin

Exactly if we didnt have a recovery with $4 trillion in QE how is the recovery going to continue with higher rates as the Fed tapers into a recession?

So we lived the Truman show since 1987 till 2014, Bernanke pulled the plug and yellen is cleaning house ....My main question is what will the fed do for the next phase which that Israeli central banker will take charge since he's the vice chairman at the federal reserve currently, That's the real brains at the fed right now. Yellen is the fall person.

I suspect they'll restart the scam again but people will fear debt and bankers. Thus the federal reserve will have to go dormant as it did after the Great Depression and it will take 3 generations for it to pull the same scam again. By that time, the great grand kids don't know what the grand parents lived through

Here is the concept of the supply /demand reversal made even clearer:
from September 2013:

http://smaulgld.com/real-estates-underwaterdown-side-sticky-catch-22/

Conclusion: What's holding back the housing market isn't low inventory, its' low demand

http://smaulgld.com/will-buy-homes-support-housing-recovery/

smaulgld says

Conclusion: What's holding back the housing market isn't low inventory, its' low demand

http://smaulgld.com/will-buy-homes-support-housing-recovery/

It's a low supply of loans due to tight underwriting conditions.

Strategist says

smaulgld says

Conclusion: What's holding back the housing market isn't low inventory, its' low demand

http://smaulgld.com/will-buy-homes-support-housing-recovery/

It's a low supply of loans due to tight underwriting conditions.

Agree in part-loans are tight because people can't meet the stringent underwriting conditions because there are not that many buyers in the right financial health to buy an overpriced home now unless. The reason for the lower number of buyers is their economic circumstances are not that good

smaulgld says

Strategist says

smaulgld says

Conclusion: What's holding back the housing market isn't low inventory, its' low demand

http://smaulgld.com/will-buy-homes-support-housing-recovery/

It's a low supply of loans due to tight underwriting conditions.

Agree in part-loans are tight because people can't meet the stringent underwriting conditions because there are not that many buyers in the right financial health to buy an overpriced home now unless. The reason for the lower number of buyers is their economic circumstances are not that good

They don't have sub prime loans anymore.
They don't have stated income anymore.
Those with bad credit or self employed have been eliminated from the demand equation. Gotta be in the millions.

Strategist says

They don't have sub prime loans anymore.

They don't have stated income anymore.

Those with bad credit or self employed have been eliminated from the demand equation. Gotta be in the millions.

Correct so without those loans many middle class people can't qualify to buy homes

smaulgld says

Strategist says

They don't have sub prime loans anymore.

They don't have stated income anymore.

Those with bad credit or self employed have been eliminated from the demand equation. Gotta be in the millions.

Correct so without those loans many middle class people can't qualify to buy homes

Yes, these sub primes and stated income loans have been around for a long time, and on their own were not responsible for the 2008 housing crash. They need to be reintroduced with low LTV's.

1995 demand due to tight 1995 underwriting conditions.

Normalization will rule the roost moving forward

Strategist says

Yes, these sub primes and stated income loans have been around for a long time, and on their own were not responsible for the 2008 housing crash. They need to be reintroduced with low LTV's.

They will introduce them when rates go a lot higher and the housing sales drop further and the banks will make money loaning at higher rates

smaulgld says

Strategist says

Yes, these sub primes and stated income loans have been around for a long time, and on their own were not responsible for the 2008 housing crash. They need to be reintroduced with low LTV's.

They will introduce them when rates go a lot higher and the housing sales drop further and the banks will make money loaning at higher rates

Therefore, we cannot have a housing crash, right?

Strategist says

Therefore, we cannot have a housing crash, right?

THey may want a crash, so prices drop which will boost demand and they can then the banks can lend out boat loads of money at lower credit profiles at higher rates to get some real volume going.

Wait a minute, the Realtor's say it's a great time to buy and they would never steer us wrong. After all, agents have their Realtor Code of Ethics. :-/

Housing cannot be said to recover until the Trade-Up-Buyer returns.

Inventory supplied by the Trade-Down-Seller will grow, but for everything to work out, potential First-Time-Buyers need to believe their jobs are secure. That is still years off, but the quit-rate shows that it is starting to turn positive.