About that Housing Peak

We have the latest Case Shiller/S&P/CoreLogic housing data just out:  Headline is a 20.6 percent annual home price gain which is super inflationary:

YEAR-OVER-YEAR
The S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index, covering all nine U.S. census divisions, reported a 20.6% annual gain in March, up from 20.0% in the previous month. The 10-City Composite annual increase came in at 19.5%, up from 18.7% in the previous month. The 20-City Composite posted a 21.2% year-over-year gain, up from 20.3% in the previous month.

MONTH-OVER-MONTH
Before seasonal adjustment, the U.S. National Index posted a 2.6% month-over-month increase in March, while the 10-City and 20-City Composites posted increases of 2.8% and 3.1%, respectively. After seasonal adjustment, the U.S. National Index posted a month-over-month increase of 2.1%, and the 10-City and 20-City Composites posted increases of 2.2% and 2.4%, respectively.

How long can it continue?

ANALYSIS
“Those of us who have been anticipating a deceleration in the growth rate of U.S. home prices will have to wait at least a month longer,” says Craig J. Lazzara, Managing Director at S&P DJI. “The National Composite Index recorded a gain of 20.6% for the 12 months ended March 2022; the 10- and 20-City Composites rose 19.5% and 21.2%, respectively. For both National and 20-City Composites, March’s reading was the highest year-over-year price change in more than 35 years of data, with the 10-City growth rate at the 99th percentile of its own history.
“The strength of the Composite indices suggests very broad strength in the housing market, which we continue to observe. All 20 cities saw double-digit price increases for the 12 months ended in March, and price growth in 17 cities accelerated relative to February’s report. March’s price increase ranked in the top quintile of historical experience for every city, and in the top decile for 19 of them.
“For the first time in nearly three years, the city with the most rapid growth in housing prices was not
Phoenix. In March, Tampa led all cities with a gain of 34.8%, with Phoenix (32.4%) and Miami (32.0%) taking silver and bronze honors. As was the case last month, prices were strongest in the South (+29.8%) and Southeast (+29.6%), with every region continuing to show impressive gains. “Mortgages are becoming more expensive as the Federal Reserve has begun to ratchet up interest rates, suggesting that the macroeconomic environment may not support extraordinary home price
growth for much longer. Although one can safely predict that price gains will begin to decelerate, the timing of the deceleration is a more difficult call.”

This may weigh on the meeting today between Joe Biden and Jerome Powell.  Be interesting to see what chair Powell has to say after.  Charts like this make renters cranky and homeowners thankful:

Housing in March was up at an annual rate of 206 percent Hyperinflation anyone

Markets have already spoken:  Down.  Set to open down 250’ish at the open.

Housing is a long-delayed report.  This is price information from month three 2022 and we’re in month six of the year tomorrow.

More on the subscriber side tomorrow.

George@Ure.net

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George Ure
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17 thoughts on “About that Housing Peak”

  1. might get wacked tonite george . noticed you went to the casino at wall and broad to have a hit of red on the great roulette wheel good luck with that

  2. Young people, couples included, who are NOT professionals or have a dual income union wage scale types of jobs, are being locked out of the housing markets by the BIG New York Financial firms who have access to BILLIONS of Dollars of CHEAP money, courtesy of the US Government. (thus buying up hundreds of thousands, millions even, of single family dwellings in the US)

    The US Government, and the FED, seems to be on a campaign to turn most Americans into RENTERS versus property owners, all for the benefit of the already top 10% class, and particularly for the top 1% class. What they are doing can’t be accidental, it has gone on too long now and has been too calculated to be anything other than part of an OVERALL PLAN.

    There is a reason why over the decades and centuries the refrain of KILL ALL THE BANKERS has resonated in country after country at times. Clearly the Banker Class in the US has decided, as has Klaus Schwab, that average people should OWN NOTHING, they should ALWAYS be paying tribute (money) to those at the top who OWN everything. Shades of the Middle Ages dynamic of Serfdom!!

    The rise of the Finance People to the top of the heap, replacing Main Street business and Industrialists (both of whom made their money off of REAL wealth creation, NOT financial manipulations) has been devastating to the American Working Class, and the lower half of the Middle Class. The massive housing price increases and ongoing massive rental price increases (overall in urban Florida rental rates are going up YoY 35% across the board, ditto Arizona, etc. etc.) which is going to impoverish tens of millions of lower middle class, or retired, Americans. (requiring them to pay even more of their low incomes to the Rent Collector Class – ie: the Banker and Finance class)

    Welcome to the World that the FED and the NY Banker Class has DREAMED of and WORKED for over the last 40 years … the impoverishment of the American Middle Class so that only the upper crust can own property and assets and also so that those in the top 10% can receive massive monthly transfer payments from the lower middle class and lower class.

    • Don’t argue your limitations! Transcend them!

      There are many ways to buy a cheap house and get on the escalator. Pay attention and improve your sales skills. You need to convince people that they need YOU to buy their worthless house!

      • NO cheap houses in my city anymore. Even in the “hood” the pricing is sky high.

        Recent survey by a local realtor showed that two weeks ago of houses OUTSIDE the city school district there were a total 11 houses for sale the previous week that were UNDER $200,000, and all had sold by their next survey the a week later, and all went for over asking (urban area of 1.5 million and we are NOT one of those “high tech” cities). In the hood you can still get a Fixer Upper for about $100k – $125k … but that is with regular shootings going on within a couple of blocks and car break ins GUARNTEED (so you never lock your car).

        Attorney I know told me last week about one of his clients who buys properties in the hood to both fix up and sell and to rent out … and that guy just paid $130k for a property that needs about $20,000 just to pass inspection (for being rented) AND the neighborhood has had 3 shootings within a couple of blocks over the last 6 weeks.

        Friends daughter just moved into a house that cost her $300k+ and that neighborhood has regular shootings and car breakins plus is in the city’s (terrible) school district (3rd worst urban school district in the state). For our urban area that was considered a CHEAP CHEAP house.

        Your comments are fine in theory … but in practice it just doesn’t work that way any more in most cities that have job availablity. OH … and our rents have been going up 20% YoY this spring. Not as bad a Florida or Arizona etc., but still that is a real hit when the average two BR rental unit here in an everyday complex WAS $1500/mo.

    • I don’t know if you’ve checked lately, the exodus out of Manhattan and all of California is just getting started in earnest. soon they will be able to convert it all to low income affordable housing. Invest in cubicles/partitions and bunk beds.

    • “Young people, couples included, who are NOT professionals or have a dual income union wage scale types of jobs, are being locked out of the housing”

      Yup.. how do you pay a mortgage on a quarter or half million dollar house on 12 dollars an hour..and pay daycare or any of their other e expenses.. you cant.. that’s why the mad rush to get on federal programs to even up the gap…
      But they are building massive apartment complexes.. even there.. average cost of low income rent is six to eight dollars an hour take home..
      For the costs of regular expenses without federal assistance.. you need four jobs..one for rent one for insurance and auto one for food and utilities one for any other expenses..
      And that is changing rapidly..

    • So, here’s my story:

      We sold our house to a young unmarried couple who came into our shop. The female of the species asked if we knew of anyone selling their home in the neighborhood where our shop is in as all the houses get bought up either before they hit the market or are bid higher than what they can pay. I asked, what are you looking to pay? They said $500,000. I said, our house is worth at least $550k, and will be worth over $600k by the end of the year. But, it is not in this neighborhood, but close by. I might be interested in selling it. This was April of 2021.

      I really knew that it was worth more than that; I had received hundreds of mailings offering to buy my house, and done my research and kept up with the price increases. Plus my home, although older, was very well built, on a great 8,200 square foot lot, and in a very desirable location.

      However, I had never listed my property, she just walked in, and I took this as a sign from God; he found my buyer without me having to go looking for one.

      So, I gave them my address. They said they were interested, one thing led to another and I sold our house, in six weeks to this young couple, AS IS, NO REALTOR fees, and I paid no closing costs. The realtor fees on $500k was $30k, which I skipped, and I did not have to do one thing to it, of course, I hired professionals to clean it after we moved out.

      They purchased it at a 3% interest rate. They were paying $1,800 for a 2 bedroom apartment. They bought our house and their mortgage was $2k for a 3 bedroom 2 bath, with sunroom, and a 2 living room house with a very nice yard, ability to drive around the side of the house, long driveway, and great neighbors.

      That house is now worth $650k, and if things continue, onward and upward.

      I knew that I had an opportunity to help a young couple (30 and 31) get started in a real estate environment that they would have a difficult time competing in. I purposefully left money on the table; could I have used that money, absolutely. It just felt right so I did something that most people, in our income range, and close to retirement would never do.

      However, the rest of the story started in December of 2016.

      We went to see a person speak, he was well respected, and had written several books. A GREAT MIND and person. We had met him about a year earlier, not that he would remember meeting us, but we were excited to get to meet him. So, now it is Dec of 2016, and he is speaking again in our town. So, off we go. Well, there was this special deal if we paid a little extra for our ticket we could have a meal with the author. I really wanted to go, my spouse was reluctant, but he relented, and we both sat in a room with only 5 other people with the esteemed guest.

      The topics varied, the conversation stimulating and it was well worth the extra fee and the topic turned to survival, prepping, what’s coming, etc. So, we expressed a desire to obtain a property outside of the city. What I did not know or realize was his wife was there. Her Mother had recently passed away, and she now wanted to sell her Mother’s house; she slipped the address across the table.

      We had no idea what a blessing was coming our way. We went out there, and it was incredible. We had never even heard of this small town. This is before the property boom. The house hadn’t been touched in 40 years. It was a perfect down size home on an acre close to a water source. She wanted more than we could pay, but we didn’t say that, we just spent a few months trying to figure out how to purchase the home as it was still going through probate.

      Fast forward, the house finally cleared probate, and someone who was helping her clean out the house offered her $30k less than she wanted, in cash, right on the spot, and she texted us; if we could buy it at that, then, we could have it, now it was in our price range.

      We purchased it with funds from a sale of 5 acres we had and from an inheritance my Mom left me. The funds from the sale of the 5 acres and the inheritance were received on the exact same day; how can you explain that? The house needed some updates, plus we rented it out for a while to bring in income.

      So, as mentioned, we sold the house in the city last year, paid off the remaining mortgage on the city house, and paid off all our debts, used some of the proceeds to improve this country property, froze our property taxes at 65 (just school taxes), and will start over there. The city house could not work for us long term, the property taxes would just never stabilize and eat away at our retirement income.

      The formula anyone can do; get thee out of the cities; go rural.

      On our rural street are millionaires and small holdings as humble as a concrete or gravel platform, and an RV. All ages are scurrying like little squirrels putting up for a hard winter. People are building their own little homes, all kinds, moving in older homes, manufactured homes, building brand new smaller homes, really, it’s being done and having a lot of money is not necessary, just the idea, and a desire to make a home. I have been really impressed at the handywork.

      Buy the land. Put in septic/electric/well OR hook up to the local cooperative that easily provides water, electric, and septic.

      Then build your dream or buy it as is, or move in another structure, these humble places are everywhere in America. Everyone on the street is living for and within their income, not living above it.

      We learned from coming to this site; the writing is on the wall. Get thee out of debt, stock up for a hard winter, and settle yourself and family.

    • “(thus buying up hundreds of thousands, millions even, of single family dwellings in the US)”

      And thus confirming my belief that the “reverse mortgage” deal was a scheme to take property out of private hands and into the hands of banks, and eventually the feds.

      • “a scheme to take property out of private hands and into the hands of banks,”

        OR…… here is another possible angle to this upcoming debacle ..

        https://www.diva-portal.org/smash/get/diva2:1388354/FULLTEXT01.pdf

        There are more studies on it.. but really does anyone want to know…. but is that money buying your mortgage from the bank.. coming from an american source.. or a source from another country.. like selling off our ports and toll roads..
        since passed legislation that now allows them to demand the thirty day pay the loan or they can take possession.. are our homes and companies being bought up to allow for them to take access..

  3. So George,being an RF kinda guy(and solar),maybe you can answer an off the wall kind of question regarding the two main solar charge controller types. How much of a “signal” do they put out when they are charging and how far away can they be received. Just asking for a friend.

  4. People paying property taxes are also probably unhappy with the loss of value of our currency from all the printing, causing these prices to rise so much. If one is not in the market to sell the rising prices/values don’t provide much benefit. Maybe if you are leveraging the homes value to make other property investments?

  5. This is starting to smell like prep work for a mobilization and landing… Famine confirmed. Wonder why these resources aren’t being protected?

    https://www.zerohedge.com/commodities/massive-fire-strikes-huge-poultry-farm-supplies-eggs-major-supermarkets

    https://www.thelibertybeacon.com/the-destruction-of-food-processing-plants-across-america-a-jon-rappoport-report/

    One of many. Cant have you commoners around with $ de-correlated assets ready to opt in on the financial reset. Why that would be too many newly created 1%’ers to deal with. LOL.

  6. Here on the Hotlanta southside my new property tax home valuation went up 38% since last year. I own one piece of rental property and it needs major repairs and updates, and it went up 28%. I’m lucky I’m about to get rid of it.

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