The National Association of Liars (Realtors) reported existing home sales this morning and they continue to blather about weather and a glorious future. Meanwhile, existing home sales have plunged by 7.5% in the last year and are now at a 21 month low. Does this chart show the housing recovery you hear so much about on the MSM? Existing home sales are at the same level they were in 1998, before the Federal Reserve induced bubble years from 1999 through 2006. A critical thinking individual might wonder how home prices have soared by double digits over the last two years as existing home sales have made no headway.
Home prices have soared by 7.9% in the last year, as sales have plunged. That makes sense. Right?
First time home buyers accounted for 30% of the sales, near a record low, and the same level as one year ago. In a healthy growing housing market they would make up 40% to 50% of buyers.
The irrational surge in home prices can be seen in the data supplied by the NAR. Here is the recipe:
- Too Big To Trust Wall Street banks withholding foreclosures from the market to create an artificial shortage of inventory.
- The Federal Reserve handing hedge funds (Blackrock) billions of free money to buy foreclosures at artificially high prices from the Too Big To Trust Wall Street banks in a buy to rent scheme designed to improve the balance sheets of the insolvent banks.
- These two suppositions are confirmed by foreclosures plunging to only 14% of sales from 21% one year ago, despite millions of homes still in the foreclosure process and the fact that 50% of all sales were to investors. In the years before the banking oligarchs took complete control of our financial system, cash sales would be 10% of transactions.
- Now that cable TV has ten flip that house shows on again, like 2006, you know every get rich quickmoron who fell for the Dot.com boom and the previous housing boom have entered the market just as the next bust is about to occur.
- You have Fannie, Freddie, and the FHA giving out 3% down mortgage loans to the delusional poor who deserve to own a home.
