Housing by the Numbers

Friday, September 15, 2006 | 04:05 PM

A brutal piece in Comstock Funds is highlighted in Marketbeat today. The Comstock boys ask "Is the Housing Hard Landing Already Here?"  (Their answer is a resounding yes).

Here is Housing by the numbers:

 32.6% of new mortgages and home equity loans in 2005 were interest only, up from 0.6% in 2000

 43% of first-time home buyers in 2005 put no money down.

 15.2% of 2005 home buyers owe at least 10% more than their home is worth.

 10% of all home owners have no equity in their homes

• $2.7 trillion in loans will adjust to higher rates in 2006 and 2007.

• 70% of borrowers who took out pay-option ARMS in the past year have loan balances larger than their initial loan.

• Homeowners face higher payments as mortgages are reset.  Generally, monthly payments rise between $200 and $500 depending on the size of the mortgage.

• According to Reality Trac, August foreclosures were up 23% over July and 53% over a year ago.

• The number of homes for sale is at record highs, and inventories are 59% higher than a year earlier.

• New home sales are down 22% and existing home sales down 11%.

• The NASB housing market index has recorded an all-time decline.

• The housing affordability index is at a 15-year low.

• The house price-to-income (rents) ratio is off the charts. According to HSBC, in 18 states accounting for over 40% of national home values, the price-to-income ratio is 3.6 standard deviations above the mean.

• The OFHEO index of house prices deflated by the consumption price deflator has soared to a record high of 350 from 250 in 2001.  From 1976 to 1996 it never was above 220.

• According to the NAR the year-to year prices of existing homes are now flat.  A short time ago they were rising at a yearly rate of 16%.

• Nationally, home prices have not declined on a year-to-year basis since 1933.  Recently, however, prices have been dropping in the North East, West and Mid-West. 

• Sales incentives are now estimated at 3% to 7% of selling prices.

Wow -- that is some soft landing you got there . . .


The Hard Landing For Housing is Already Here
Thursday, September 14, 2006


Friday, September 15, 2006 | 04:05 PM | Permalink | Comments (66) | TrackBack (1)
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» Watching housing slide from Econbrowser
The Census Bureau yesterday released August data for housing permits and new housing starts, both of which confirm that we are in the midst of a significant housing downturn. [Read More]

Tracked on Sep 20, 2006 8:18:34 AM


When you east-coasters say Mid-West... do they mean Ohio or the REAL midwest... (the states west of the mississippi and east of the rockies)?

I live in what I consider the real midwest and between St. Louis and Denver, there aren't many markets that had any sort of housing inflation (relative to real inflation). Though many new homes are now coming with discounts, often times the discounts are still putting it pricier than the cost of the house one year ago. Looking at housing prices in Memphis, STL, Omaha, Kansas City, OKC, etc.... housing prices are stable or slightly up... and almost identical to inflation for their relative areas.

Posted by: Chad K | Sep 15, 2006 4:39:58 PM

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