Relevant and even prescient commentary on news, politics and the economy.

New home sales decline in April, revised sharply lower for March; prices continue to skyrocket, while inventory increases

New home sales decline in April, revised sharply lower for March; prices continue to skyrocket, while inventory increases This morning both new home sales and two price indexes for houses were released for April, completing our view of that important long leading sector. As anticipated, not only did new home sales decline for the month, […]

Home Values: Delusional Buyers, Bank Squeezers and Zillow

by Mike Kimel Home Values: Delusional Buyers, Bank Squeezers and Zillow Via Barry Ritholtz, a link to a post at Time Moneyland post which led to a post at the Zillow blog: Zillow recently compared the asking price of 1 million for-sale homes with those homes’ previous purchase price, then factored in the change in […]

Telling the Right Story, or Economists Catching Up Round One

Anyone who was in the MBS market and not working for a primary originator can tell you that the MBS securitization market ended around Halloween 2006. (Those of us who were at places with origination go a few more months, but had no flow by February.) Only economists were fooled by what I’ve been calling […]

David Streitfeld Knows Better than This

The NYT moves deeply into delusion: The rolling real estate crash that ravaged Florida and the Southwest is delivering a new wave of distress to communities once thought to be immune— economically diversified cities where the boom was relatively restrained. In the last year, home prices in Seattle had a bigger decline than in Las […]

Bernanke: We Didn’t Do a Good job Regulating, so Let Us Regulate More

UPDATE: CR appears to agree with me, even as he raises another point: Bernanke used data from other countries to suggest monetary policy was not a huge contributor to the bubble … however, Bernanke didn’t discuss if non-traditional mortgage products contributed to housing bubbles in other countries. This would seem like a key missing part […]

Today in "Economists Are NOT Totally Clueless" (Part 1 of 2 or 3)

The WSJ collects reactions to the release of the latest Case-Shiller index. Let’s look at two, just for fun: One in four mortgages are currently underwater. Foreclosure and delinquency rates, which hit a record high at the end of the third quarter of 2009, are therefore likely to continue to rise, perhaps sharply. In addition […]

Scariest Irvine Foreclosure

Dr. Black had a link to foreclosures in Irvine, California. This one especially caught my eye: 5031 Alcorn Lane, Turtle RockAmount owed: $298,876.14Last sale: July 2001, $485,000Auction date & time: Nov. 5 at 10 a.m.Location: In front of the flagpoles at Placentia Civic Center, 401-411 E. Chapman Ave.Trustee sale #: JPM-580Information: 714-573-1965 [emphasis mine] I […]

A housing bubble illustration

by Rebecca Yesterday’s post on the Australian economy sparked some discussion of its housing market. I agree – Australia’s bubble is large relative to that in the US (interestingly enough) and Canada. The chart illustrates the price to rent ratio in Australia, Canada, France, Ireland, the UK, and the US, which measures the trade-off between […]

Trends in home values: becoming murky

by Rebecca Wilder Actually, murky is something of a good thing when referring to business cycle dynamics. It usually means that a bottom is forming. In some sense, the key to recovery is the stabilization of home values. If home values would just “stop” declining – I understand that there is a market mechanism going […]

This May Make Robert Shiller and SocSec recipients happy…

but it doesn’t do that much for the rest of us. Via The Ambrosini Critique, Scott Sumner discovers there was no housing crash: The BLS claims that housing prices are up 2.1% in the last 12 months….According to the BLS, housing makes up nearly 40% of the core basket of goods and services. Further reading […]