Housing Market Update – Exclusive Information

by Dave Kranzler, Investment Research Dynamics I find it interesting that we’re now seeing some other analysts/bloggers discuss the housing market in a bearish “light.” So far everything I’ve read is nothing more than a regurgitation of the information and analysis I’ve been presenting for over a year. The facts and the trends in the data have not all of a sudden become “bearish.” Perhaps it’s now becoming more obvious. Here’s some facts: 1) The trend in unit sales volume for both new and existing home sales has been negative on a year over year monthly comparison basis (i.e. July 2014 vs. July 2013, etc) since July 2013. Yes, there been some blips in the data, some of it “dead-cat” bounce noise and most of it fictitious “seasonal ajustments” based on data samples that are then converted into annualized rates. Just that concept alone, converting an estimate into an annualized rate for a given month is nothing more than unmitigated brain damage. 2) Mortgage purchase applications have been in cliff-dive formation for well over a year. This is the foundation of the traditional first-time buyer/move-up buyer market. It’s at least 70% of sales volume over a long period of time. 3) Mortgage applications AND unit sales volume has been declining DESPITE the fact that mortgage rates have been falling for over a year now to near-record lows. 4) The investment buyer game is over 5) Inventory is starting to pile up everywhere AND flippers are now finding themselves “stuck” with homes. But don’t take it from me. A long-time reader who works for a title attorney in the DC area sent me this email last week:

I am in the DC Metro area. We have been in business for 29 years and to give you an idea of our drop off: On the average we would have 700 title orders a month. During the boom it doubled,almost tripled. We are lucky if we see 120 cases a month now and very lucky if they make it to settlement and get paid. This is just for title searches.

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