Nearly 7% of for-sale homes posted a price drop during the four weeks ending October 29, on average, the highest portion on record. . . .
Sale prices are still up 3% from a year ago. That’s partly because sale-price data is a lagging indicator, reflecting deals that went under contract a month or two ago. Growth in sale prices may slow in the coming months as it starts to reflect sales that went under contract as mortgage rates hit 8% in October.
Another reason for rising sale prices is that despite slow demand, low inventory is propping up prices. The total number of homes for sale is down 10% year over year; . . .
Redfin agents describe a mismatch between sellers’ high expectations and the reality of buyers’ budgets . . .
The pool of available buyers with the ability to afford homes has naturally dwindled. No surprise. It has taken longer than most predicted but I’m still in camp that the economy is going to continue to slow and head into a recession, probably sometime mid next year.
Hell considering the huge uptick in car repos and that market just being ridiculous don’t be surprised if we end up in an automobile caused depression by next year.
I’ve got a friend who sells used cars. He said the other day that he has never seen so many cars listed as “repossessions” at the local auctions in his entire life. To me that says a ton about the economy. Because a good many of the cars he sent me were less than two years old. I’m used to seeing ■■■■ box 6 year old Chargers or Challengers at the repo lot. But two year old Toyota Sequoias and Honda Pilots? That’s really unusual since the people who buy those types of cars usually have stellar credit.
Economically America’s 123.6 million households fall into three categories of almost exactly equal size (within 1% of each other)
**1/3 ** Own a home with a mortgage on it. Nearly all of them recently refinanced at 2.5-3% and received, in effect, a $1,000+/month pay increase.
Savings deposits into banks did NOT increase by a commensurate amount. But spending on consumer items increased, and so did new inflows into investment (stock) accounts.
For the moment let’s forget PPP loans, Stimmy checks and Brandon’s gifts to his econ-industry donors.
41 million households got a $1,000 monthly pay increase.
They are not putting it into banks.
They are using it to buy consumer items (travel and restaurants etc.)
and they are using it to buy stocks and bonds and crypto and, for a while NFTs and land in the metaverse.
That leads to
Higher prices for consumer items (at least temporarily)
Higher prices for stocks and bonds and crypto (at least temporarily.
And those higher prices affect all three groups of American households.
More later.
