Unfinished Houses for Sale Pile Up, Total Inventory Highest since 2008, amid Material Shortages & Worst Spike in Construction Costs since 1979

Sales of new single-family houses fall 24% from a year ago. The lower end has died.

By Wolf Richter for WOLF STREET.

Sales of new single-family houses in August were down by 24.3% from August last year, to a seasonally adjusted annual rate of 740,000 houses, according to the Census Bureau this morning.

Sales of single-family houses remain far below their peak during the years of 2002 through 2007, in part due to the large-scale construction boom since then in multi-family buildings, such as condo towers and apartment towers:

Ballooning inventories: A record 90.5% of the houses for sale are either not started or unfinished, as total inventory piles up. Homebuilders are complaining about material shortages and labor shortages and surging costs and all kinds of other issues that prevent them from starting construction or completing construction.

Inventory for sale by stage of construction. The number of:

  • Not-started houses for sale jumped to 105,000 (up from 60,000 in August 2019);
  • Under-construction houses for sale jumped to 237,000 (up from 185,000 in August 2019).
  • Completed houses for sale, at 36,000, were far below August 2019 (81,000).

Total inventory for sale, from not-started to completed houses, rose to 378,000, the most since October 2008:

Supply of new houses has been above 6 months for the fourth month in a row, at the top end of the pre-pandemic range except for 2018, when surging mortgage rates triggered a slowdown in sales, and therefore an increase in months’ supply:

The median price, at $390,900, was unchanged from July and May and was up 20% from a year ago.

The median price is heavily skewed by the ongoing shift in mix to more expensive homes, with the low end dying out completely:

  • Almost no homes with a price of under $200,000 were sold. This category has died.
  • Under-$300,000 homes accounted for only 29% of total sales, down from 35% in August 2020 and down from 42% in August 2019.
  • $300,000 to $400,000 homes accounted for 19% of total sales.
  • Over-$400,000 homes accounted for 51% of sales, up from 31% in August 2020, with the over-$500,000 homes, which is where the money is, accounting for 31% of sales.

Construction costs spiked the most since 1979, amid all kinds of shortages and price spikes of materials. According to separate data by the Commerce Department, construction costs for single-family houses, excluding the cost of land and other non-construction costs, spiked by 12.8% in August compared to a year ago, the fastest year-over-year surge in construction costs since 1979:

Lumber has come off its ridiculous spike, but Chicago lumber futures, now rising again and at $650 per thousand board feet, are still 70% higher than they’d been in August 2019. Steel prices have continued to surge. Futures of Polyvinyl Chloride, the material for PVC pipes, have surged 65% year-over-year. Costs have surged across the board.

There are anecdotal reports coming out of the homebuilder industry of shortages of all kinds: Shortages of windows and doors – the glass shortage is apparently behind the WOLF STREET beer mug shortage – steel beams, insulation, appliances, roofing materials, copper wiring, fasteners, plumbing fixtures…. And prices of materials are responding in the most monstrously overstimulated economy ever, and these costs are getting passed on.

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  253 comments for “Unfinished Houses for Sale Pile Up, Total Inventory Highest since 2008, amid Material Shortages & Worst Spike in Construction Costs since 1979

  1. Harvey Mushman says:

    The U.S. Census Bureau reported that new-home sales increased for the month of August for the second straight month. I just read that today in a CNBC article titled “10-year Treasury yields increase on week as Fed inches closer to bond taper”.

    • Wolf Richter says:

      Harvey Mushman,

      New home sales in August were down 24% year-over-year. Hence the charts, which make it clear. People who get their econ info from some MSM headlines are going to be misinformed.

      • Harvey Mushman says:

        That’s what I like about this site, you have charts to back up your claims. CNBC… no so much.

      • Phoneix_Ikki says:

        This is soo true, I read the MSM headline and came straight here…obviously the MSM headline are just full of bubble gum narrative. Can always count on this site to provide some meaningful data to make sense of it all..

        Here’s how wonderful the MSM headlines are, literally copy and paste probably something from NAR..

        US new home sales surprisingly strong in August: govt
        U.S. new home sales beat expectations; supply near 13-year high

      • MCH says:

        Wolf

        Where are these new home constructions located? Real estate is all local. Here in the bay area, there is a continuing cry of housing crisis and the response by GG (Governor Gavin) is SB8, 9, and 10.

        Reduction in environmental regulations, changes in SF zoning, etc, etc. All of it feels like an attempt to cram more living space in place. I wonder where is the water and electricity going to come from on all of these. We already have a drought going, and then there was electrical problems during the summer. But let’s build more houses, and pack em in like sardines.

        • Rcohn says:

          Too many people , too much traffic, too many taxes
          Expect rationing of water and blackouts next year

        • Wolf Richter says:

          Rcohn,

          Are you talking about Texas?

          :-]

        • Wolf Richter says:

          MCH,

          A house is not for everyone. I refuse to live in a house, will never live in a house. No way in hell will I ever live in the suburbs. I’m a city guy. I love living in the middle of big cities. And I’m not the only one. So in San Francisco, there have essentially not been any single-family houses built in decades. It’s all multi-family, smaller fill-ins and lots of towers. And there has been a ton of construction of that type. But it doesn’t show up in the single-family category.

          Multi-family is a separate category, and it’s more complex in terms of “sales” because it involves condos and rentals. And the data is not well tracked. And you’d have to count units and not buildings.

        • MCH says:

          @Wolf,

          Agreed on the fact that a house if not for everyone. In cities like NYC, SF, Chicago, Honolulu, it doesn’t work well.

          That said, I am still curious about whether your data has any information on how this is occurring geographically?

          For example, is this inventory located in the south, Fl for example, or TX, or is it more in the NE?

        • cas127 says:

          One imperfect proxy for geographic location of home inventory buildups…the monthly Zumper apartment price surveys that Wolf reports on. Rent prices adjust to reflect increases/shortfalls in housing supply.

          In the short term, other factors can distort this (RE speculation driving apartment complex speculation up…followed by attempted – if doomed – rent hikes to recoup overpayments for complexes, or Covid eviction moratoriums greatly limiting turnover supply) but in the longer term, apt supply and demand determine rent levels…so rent price changes can tell us about supply and demand levels as well.

        • Petunia says:

          MCH,

          Watched a video a few months ago on real estate in Austin, Tx. The guy was claiming over 20K units(apts) were permitted there and most would be completed by next year. You might want to check that out.

          I also watched a video of a guy walking around LA in a section where hundreds of apts were mostly built. It was an area where the homeless problem was significant. The units were mostly condos starting at $600K.

        • MCH says:

          @Petunia,

          I see…. So i wonder if the point is that SFH inventory are piling up because people can’t afford them any more and it’s better to just put up a bunch of condos and apartments.

          Yup…. There are too many people in the cities.

      • Wes says:

        Mr. Richter, is it possible that the lifting of the forbearance of mortgages may have impacted the lower end of the housing market?

      • Randy says:

        What the MSM dont tell the truth? LMAO! Frankly anybody who evens turns on them news channels needs to go see a psychiatrist. There nothing but a brainwashing propaganda machine.
        As for home sales there’s plenty of evidence here in Florida that nothing is selling. Ive had 4 subdivisions pop up withing a couple mile radius of where i live during this plandemic, plenty of houses going up but ive yet to see a single one moved into yet. And all high dollar at least 3500 sq.ft. houses all vacant. Biggest construction boom ive seen in this town in my lifetime and ive lived in the same town my whole life(60 years). Subdivisions having been popping up everywhere in and around town.
        And for a fun little kicker I’ll mention 2 of these subdivisions are right next to our old dump, ground is toxic as hell. Methane gas pipes stick out of the ground all around it and they have test wells all around it too. Good luck to the fools who buy those toxic poisoned properties.

    • qt says:

      Month to month vs year to year

  2. RightNYer says:

    I’m loving watching all of this fall apart. Americans need pain to learn resilience. We’ve been too prosperous for too long.

    • Joe Saba says:

      I’m fine with what we have
      making more $$ every day now
      to bad nothing to spend on YET

    • Poor like you says:

      I call it prosperity disease.

      • guamuchil says:

        the classic word is “decadence”

        • Khowdung Flunghi says:

          How ’bout “small batch dog food” as a candidate for the “decadence find of the week” award?

        • Fat Chewer says:

          Khowdung, I think you have won that award. Watch for the next step; meals cooked and delivered to your dog via UberEats.

      • Winston says:

        He was referring to politics, but it’s a fit on this subject, too:

        “Prosperity breeds idiots.” – Aleksandr Solzhenitsyn

    • jon says:

      I don’t think anything is falling apart. If the home prices go down by 20-30%, don’t see as a bad thing. On the other hand, it’d be good to make homes affordable to common joe
      People who are holding many homes as investments would be hurt though.

      • Lololo says:

        Common Joe here. It’s insane how little if a home we actually want and how unattainable it actually is with these ridiculous prices. We have a lot more money saved up than most couples and we still cannot afford to buy a decent home.

    • Jay says:

      I live in Woodstock, GA. Really nice suburb of ATL. My home: 1,298 SF, spec home 22 years old. 2 BR, 2.5 BTH and a small loft, some brick with vinyl, 600 SF back yard. Cute house. My home has appreciated 82% in 3 years and is up to $237 SF which is beyond insane. The FED has created a monstosity of a housing & equities bubble. Anyone with 1/2 a brain knows this which doesn’t bode well for Powell & many of his FED counterparts.

      • Alan says:

        Yes home sale pressure is not a misperception here. Realtors busier an last 30 years Live in Billings Mt. Urban influx driving prices up, our children can no longer find affordable housing. Biggest impact wa 400K range now 600 or 700k.
        Houses bought everywhere, sight unseen, cash purchases almost always, above asking. Inspections waived. It’s “Just get me away from the homelessness”.

    • Depth Charge says:

      We need an absolutely massive recession/depression to get rid of all of this malinvestment, excess debt and greed disease. Millions need to be totally wiped out to the point of bankruptcy, especially levered corporations.

      • Nacho Bigly Libre says:

        Why will it be different than 2008?

        Same institutions and same incentives.

        If anything, post-2008 effusive money printing and lack of public protests mean we can expect more of the same.

        Instead of 800 billion TALP, this time we will get 8 trillion of relief. You know, to keep credit markets from freezing up.

        End the money printers, end the Fed.

        • Old School says:

          I think the thing that is different is that we are at the end of creating more dollars being a good or benign thing. Creating more dollars now is going to be a big negative.

        • RightNYer says:

          Old School, yes.

          It’s a form of recency bias. History is littered with examples of unrestrained money printing being an unmitigated disaster, but our being the largest economy and being the reserve currency allowed us to get away with it without being that big negative (mostly). This has led people to think that we can ALWAYS get away with it.

          But in reality, playing these games for 12 years while having been the most prominent superpower for nearly a century is not that long. In other words, the fact that it hadn’t been the big negative doesn’t mean that it’s going to stay that way. I agree with you that its time is nearing the end.

        • Nacho Bigly Libre says:

          Creating more dollars out of thin air was *always* a negative thing. Never a benign or a good thing.

          I am asking what incentives have changed that now you expect the Fed, politicians and the banks will act differently? Have the BLS or the mainstream media been telling the truth about inflation? Do you see any BLM style ‘peaceful’ protests?

          You can pin your hopes on the Fed or the politicians doing the ‘right thing’. I don’t.

        • RightNYer says:

          Nacho, the difference here is that its negative effects are manifest whereas they weren’t before.

          People now are seeing higher and higher prices on things they need (including housing) and are getting angry.

        • Mr. House says:

          You already did, it was called the CARES ACT

      • Swamp Creature says:

        Depth Charge

        Bring it on! Sooner rather than later!

    • RH says:

      This is a little too much like 2008 for comfort. I remember home prices creeping into unaffordable territory where I live. The same is happening now and when enough potential buyers can no longer buy at those prices, prices must come down.

    • kam says:

      American Government Policy for 30 years has been the destruction of the American Private Sector Working Class. The death of jobs and families.
      No other dominant nation in History has so quickly destroyed it’s own economic engine of real growth. The growth in income and wealth by earning it, not inflating it.
      BTW, cash lumber prices are $100-200 below futures. Futures being the paper derivative market where big money swamps the boat.

  3. Timothy says:

    If Over-$400,000 homes accounted for 51% of sales, then how is the median $390,900 …wouldn’t it be above $400,000?

    • Wolf Richter says:

      Timothy,

      Median v. average.

      $390,900 is the “median price.”

      What you’re referring to is the “average price” and yes the average price is over $400k. It’s $443K. The average price = total sales in dollars divided by number of houses sold.

      The “median price” is the price in the middle. If you sold 1,000 houses, you put all 1,000 homes on a list and sort by price. The price of the house in the 500th line from the top down or bottom up is the “median price.”

      • BuySome says:

        Since there is no “prisoner zero”, houses 1-500 would be below median, with houses 501-1000 above it. Would not the median lie halfway twixt 500 and 501?

      • Depth Charge says:

        He’s right, Wolf. If more than half of the houses sold above the price of $400,000, then the median would be above $400,000.

        • andy says:

          By your own definition – if 90% of the houses sold for more than 400K, what would the median be?

        • Depth Charge says:

          Above $400k, Andy, but the actual number is impossible to calculate without looking at all of the individual sales.

    • Jay says:

      And the median value is more resistant to being influenced by either high or low outliers in terms of home sales values. With the median being below the average, the data is skewed left / negative meaning more data lies below the average. It also means there’s less variation above the mean which makes sense with home prices as they get more expensive above the mean.

      • Old school says:

        One thing too is American’s grew up with cheap housing. As family size has shrunk, a couple of years ago average house size was right at 2500 sq ft for 2.5 people or right at 1000 sq ft per person. That’s a lot compared to rest of world.

        I know a lot widows and divorcees living alone in $2000 sq ft 3 bedroom/ 2 baths.

        • Cas127 says:

          “I know a lot widows and divorcees living alone in $2000 sq ft 3 bedroom/ 2 baths.”

          Names? Phone numbers? Pics?…

        • Michael Gorback says:

          I happen to live alone in a 3 BR 2 bath house. Besides the MBR one BR is for my office and the other is for hydroponic gardening. The one room I don’t have any use for is the dining room. I have a good friend who always eats dinner in the dining room with his wife. Or eats his wife in the dining room. I forget which. Either way, I’d give up the dining room before the 3rd BR.

          As for city vs burbs, I can’t stand city noise and crowds. To each his own. Even the suburbs get on my my nerves with lawn mowers and leaf blowers, which is why I bought 20 acres outside of a town with pop 900.

    • TheRealMRDyno says:

      It says “Over-$400,000 homes accounted for 51% of sales”.

      I read it the same way as you, as in 51% of number-of-sales, not 51% of sales-value. Different backgrounds lead to different assumptions. I always try to check the math on that kind of thing both ways.

      I generally try to check the math on everything period since it seems many, many people are simply innumerate.

      • Wolf Richter says:

        TheRealMRDyno,

        % of number of homes sold.

        The number of over-$400,000 homes sold = 31,000 (rounded, not annual rate) = 51% of 62,000 total homes sold (rounded, not annual rate).

      • robert says:

        The over-$400,000 sales cannot exceed 50% of the number of unit sales; it is a subset of the 50%-above-median unit sales.
        The definition of median, is 50% of total units above, 50% below. If 62,000 sold, then 31,000 are above the median, 31,000 below. A median by definition cannot be different from 50%. If the lowest price of the upper 31,000 was 391,600 and the highest price of the lower 31,000 was 390,000 then the median price would be 390,800.
        It could mean that that 51% (15,810 units) of the number of houses above the median price sold for more than $400,000, and 49% (15,190) of the above-median price sold for less. There would have to be a lot of houses that sold for between the median and $400,000 (15,190 units), a spread of only $9,200, probably unlikely.
        Alternatively, the 51% could be gross sales value of the over- $400,000 sales price of all 62,000 houses sold, which is a different metric than the median price. This seems about right.

  4. Peanut Gallery says:

    Apparently Evergrande didn’t make their interest payment to bond holders.

    And the markets are just ho-hum about everything!

    • DR DOOM says:

      Evergrande did not make their dollar denominated interest payments. they are considered to be in a 30 day “grace” delinquent period. Don’t know about yuan denominated payments were met or if they even exist or it might not matter as they are all denominated in dollars. The takeaway is no body got paid but the lawyers and talking heads on MSM that couldn’t explain anything and don’t give a shit anyway.

      • Old School says:

        Got to be careful when you give your investment dollars to people you don’t know. Sounds like auditors were a joke as usual.

        • robert says:

          In real estate, Zeckendorf said: Don’t buy it if you can’t walk to it.
          It served him well in New York. Then much later he bought out of New York and it didn’t go well.

        • Fat Chewer says:

          Sounds like the ratings were off too. The first thing that triggers a downgrade is a possible default on bond payments. What about paying suppliers and customers with IOUs for years? That doesn’t trigger a downgrade. So when they finally do give a downgrade, it’s almost lost in the noise of an impending default.

          It comes long after people have already bought the worthless paper. That information was supposed to be relevant BEFORE people bought the worthless paper.

          It appears they downgraded the rating based on exactly the same information the rest of us got from the MSM. Isn’t it their job to have this kind of information before it becomes a problem? Isn’t that what a well informed ratings agency does?

          How can we do due diligence when the people with the important information and who are supposed to be impartial act like all is roses, even as a company that is issuing bonds racks up billions in debts to it’s customers and suppliers?

        • Auldyin says:

          @OS
          If you are getting 10% when the 10yr is 1.4% it’s a scam.
          Always has been, always will be.
          They used to teach that in infant school in Scotland but now they don’t even teach 2+2.
          Just sayin’

      • BuySome says:

        So what, Evergrande got themselves an eviction moratorium? Maybe they can consider all that debt a leaning curve and just cancel it all like one giant student loan. Hell, it’s time to start handing out all the boarding passes for vacations on Mars. Now we know why the guys that made the psychadelic posters called themselves the “Print Mint”. It’s a black-light world where dead-guys pictures glow in the dark.

    • Lynn says:

      The media was spinning the fact they made a payment to Chinese banks, even though they defaulted on the larger dollar and offshore loans. Made it sound like they made all payments rather than one smaller one.

      • roddy6667 says:

        China will probably take care of the mainland bond holders and the 1.3 million with homes under construction. Taking care of the citizens instead of the top 5% will resonate well inside China. It is in keeping with Xi’s current programs.

        • Old School says:

          Sounds like among other things China wanted or needed to try to reign in some risk taking and the weakest large developer blew up first. Same thing will happen here when Fed starts removing punch bowl, someone big will blow up and then Fed will stop.

    • andy says:

      They paid it in full with unfinished apartments.

      • Trailer Trash says:

        I kinda like the idea of paying the bills with unstarted houses inventory.

  5. Keepcalmeverythingisfine says:

    Possible inventory glut colliding with higher mortgage rates? Could happen. Thanks for the charts, interesting. I carefully watch new home prices as a leading indicator of recession.

  6. Seneca's cliff says:

    My son has a house reserved in a new subdivision being built by one of the big national home builders. The good thing is that he had the price locked in as of a couple of months ago. It is slated to be done in January, but they came back to him and said they would be deducting the cost of the outdoor portion of the Central AC because they could not get it by then, and he would be on his own to find one himself after taking ownership.

    • RightNYer says:

      Translation: They can’t get the AC condenser at a price that they’re willing to pay.

    • Peanut Gallery says:

      We just got central AC installed. There was a $2000 difference between the two vendors we got quotes from for pretty much identical products.

      Some price gouging going on.

    • TheRealMRDyno says:

      I’d check the sales contract pretty closely, not sure how they can do that.

      Also, HVAC work has crazy overhead, an HVAC company will charge about $4k to replace a standard furnace alone, no AC. You can buy one for about $850, made by Goodman in the USA, delivered, on Amazon. They won’t honor warranties on diy installs, but you can get anyone with an HVAC license to install it for $300-$500. HVAC guys hate Goodman, and not because they are bad.

      • Trucker guy says:

        HVAC guys hate Goodman/Amana because they’re garbage that you have to constantly return to fix awful craftsmanship and cut corners while having to deal with angry homeowners.

        There’s a reason they’re among if not the cheapest hardware to install.

        • True Texas says:

          Our neighbor’s Goodman is the original unit that came with the home they had built 22 years ago and runs just fine. In fact, we’ve only seen a repairman out there a couple of times over the 17 years that we’ve been here. Our Goodman is also an excellent unit, while not as old as theirs (only because we wanted a newer one) and we’ve had no problems, with decent electric bills.

        • TheRealMRDyno says:

          Yes, and that reason is: you (can) buy them direct, and don’t pay for the HVAC company’s building, support staff, advertising, insurance, utilities, etc.

          There is a similar reason why guys with an HVAC license will work directly for $30-50/hr, vs $150/hr when sent from an HVAC company. The same thing is true for many fields.

          Re: quality – have you been listening to HVAC guys? Or is that you talking?

        • VintageVNvet says:

          Maybe do trckguy,,, but our neighbor got a new one of that brand, both inside and out, and when it needed the part apparently designed to fail at half the ”service life” of his unit, the original guy came and replaced it free or charge,,,
          Ours was one of the big three brands, and we were quoted a couple hundred, in spite of the actual part being free of charge, by, as mentioned, one of the large HVAC ”service contractors”…
          I told him to pound sand, or whatever, and then called the neighbors guy who quoted less than half for the replacement including the part….
          HVAC, especially the AC part,, almost a total scam in FL,,, and we can only hope the guv stops it, along with the other scams he has stopped or at least slowed down in the last few years…

        • Jay says:

          BS. I replaced my 20 year-old Rheem with a 3T 14 SEER Goodman single stage with a 60K BTU 96 AFUE furnace two years ago for less $5,900. Everything is working flawlessly and has cut my cooling bills by 1/3 and my heating bill by 25%.

          Goodman / Amana are owned by Daikin, the largest HVAC company in the world. Goodman uses quality scroll compressors & components like everyone else. It’s more important to find a quality installer than anything else. And like Trane, they now have Inverter based compressors.

          If at the very least, you can go online to acwholesalers & hvacdirect and find pricing on like components that you can use a basis for ensuring you get a reasonable quote. For example, you could buy a 3T two stage 18 SEER Goodman condensor for $2589 with no shipping delays. And that’s not a true wholesale price.

          I guarantee that a licensed installer can buy a like Lennox condensor for no more than $200 more than the Goodman, if not almost the same wholesale vs retail price.

        • Petunia says:

          We rented a house with an Amana AC. It broke down twice a year, the landlord claimed the AC was brand new because it was only 7 years old. I wouldn’t recommend it.

        • sc7 says:

          Goodman is fine and easy to fix. The issue is they sell to hack installers that make them unreliable.

        • Ron says:

          Not true have a Goodman furnace 10 years no problems

      • Trailer Trash says:

        I just paid $3500 for a new oil furnace for my trailer and I was happy to pay it for a very well made furnace, made in USA. I didn’t have to lift a finger except to write the check. The techs really like this brand. As a former wrench-turner myself, I’ll go with the technicians’ opinion every time.

    • andy says:

      Same story with my friend, but they deducted the roof.

  7. Saltcreep says:

    And this is the sort of stuff the Fed is tapering and tightening into..? I reckon the bookies should be lining up odds for us to bet on as to what the excuses will be that they’ll provide, when, sometime next year, they’ll be furiously backpedalling on their ‘hawkish’ line, as the peaking and slackening of the measures they are goaded by are, in my estimation, likely to become apparent.

    • BP says:

      Tightening into? They loosened it all into this mess. It needs to end.

      • Saltcreep says:

        Hey BP. It shouldn’t have ever started, I would contend, but the trap has shut and they’re caught.

  8. Ralph Hiesey says:

    “The median price is heavily skewed by the ongoing shift in mix to more expensive homes, with the low end dying out completely:”

    That illustrates exactly what I’ve been thinking (and occasionally saying) for awhile about “inflation.”

    The rich are howling “inflation inflation.” (Oh, Wolf, I don’t mean you!) I suspect the same is true in vehicles–the expensive ones are — especially when supply is short– because those with lots of $$ don’t really care what the price is.

    Not difficult to understand why: The top 2% of wealth hold 50% of total wealth. The bottom 50% hold 2% of total wealth.

    We are having inflation for the rich (plenty!) but not so much for the poor. The bottom 70% wealth can’t yet afford inflation–unless their wages go up a lot.

    I suspect a lot of suppliers, because of supply problems are taking advantage of those who are willing to pay whatever it takes to get what they want.

    Wolf, you should boost your price to $150 donation to get one of those rare mugs you have–they’ll be gone in November!

    • Wolf Richter says:

      Ralph Hiesey,

      House prices don’t figure into inflation calculations.

      32% of CPI is based on RENTS (including owners equivalent of rent).

      I think you might misunderstand how inflation is calculated. Inflation is NOT based on the median price. It’s based on how the price of the SAME ITEM has changed over time.

      • Ralph Hiesey says:

        Of course you’re right, I realize that housing prices for inflation are based on “equivalent rent.” So house price inflation is “asset” inflation, not price inflation.

        I’m just suggesting that it’s possible that those who have the big bucks are also influencing the other factors that the Fed measures when measuring inflation. With Covid supply shortages, those who are willing to pay the most will be able to buy stuff in short supply, whose prices are temporarily jacked up, due to shortages. That will bias price inflation up until such shortages are resolved.

        It would be interesting to compare price inflation with goods that the rich buy, like higher end vehicles, housing materials, and almost any housing assets now and compare it with goods that the bottom 70% buy, like those at Target and Walmart.

        Lots of highly visible asset inflation that alarms people is not price inflation.

        Not saying the Fed has been right, just think it’s too little early to know for sure how bad price inflation will be until well after Covid.

  9. Djreef says:

    Go on Realtor.com and find a house under $200,000. I dare you.

    FEMA Trailers don’t count.

    • Antwan says:

      You can find single family homes in say Beckley, WV for $100,000. Of course, there’s valid reasons why homes in such places or Niagara Falls or Kensington in Philly are so cheap.

      • Cas127 says:

        Valid point, but I seriously wonder if it is really a simple lack of jobs in such areas, rather than any intrinsic awfulness (crime, horrible weather, etc) that yields very low home prices.

        This is a very large country with a significant number of places that businesses/industry have moved on from…but the housing remains (resulting in markedly low prices).

        Viewed accurately, those low cost homes can be an asset in themselves (for retirees, remote workers, etc)

        • BuySome says:

          If anyone wants to poke the embedded fleas on this old dog, I would nominate Udell Iowa for a sample in the case study. Railroads crossing there are long gone, but as far as I can tell every Tornado has gone past this hamlet miraculously. The only crime stat way out of there seems to be a sex-listed incident. And since the population is still white as potatoes, you can’t easily prejudice the numbers by blaming it on color effects. This can of beans was packed long ago before date codes….how fresh it it?

        • VintageVNvet says:

          EXACTLY CORRECT c-10:
          Penultimate place we lived and loved, friend bought at courthouse steps, for 2 or 3 thousand, houses ready to live in after the last crash…
          He being a good guy, usually put in a couple thousand more to fix anything and re paint the entire interior, and then either sold for a nice few thousand profit, or rented at local rate and/or refinanced on the rent to go do it again,,, and apparently did many dozens, and will likely be ready, willing, and able to do it again after the crash now so clearly, ( at least to us older than boomers ),,, coming sooner than some may think or hope.

      • Andy the Car says:

        Back in the Aughts, you could buy homes in Greenbrier and Pocahontas Counties in WV for as little as $15K. I remember looking at houses in Marlinton that were in good shape in the $20Ks. Of course, we’re talking about the middle of freakin’ nowhere. Beckley was the big city comparatively, but even there $40K would get you something reasonably liveable.

    • Peanut Gallery says:

      I’m sure there are still some houses in the KC, MO area that are sub-200K right? Not desirable areas though.

    • Young Buck says:

      Theres some decent houses in Wisconsin for under $200k, but who wants to live in Wisconsin, amirite?

      • RedRaider says:

        Hey! I live in Wisconsin. It’s a nice place. I would say avoid the Milwaukee and Madison areas but that’s just personal tastes. If prefer the upper half of the state and live in the central area.

        I remember when Detroit went bankrupt. They were showing a house in the suburbs that was selling for $5k. It would have gone for $125k in my area. Probably over $1 million in California. I wondered what the property taxes on that $5k house were. I’m willing to guess $5k/year. Imagine that – 100% property tax!

    • Mendocino Coast says:

      I can Help you with that :

      Perhaps Wolf will remove the Link ut as you asked here are your listing under $200,00 as requested and as I lived in NC I happen to know how very Nice it is . The Appalacian ( Blue Ridge ) is one of my favorite Places . Not everwhere is California or wherever your perhaps thinking about ???
      Point being you just dead wrong no offense intended

    • Lynn says:

      I currently live in Tulsa, Ok. I have lived in my current home for 20 years. I was a realtor for years. I am now in the process of purchasing a home in Missouri in the country 15 minutes from a lake. It is a 131 year old, a little over 2,000 sq. Ft on 1 acre. The roof, ac and Hardiebacker siding is new. It has hardwood floors and tile in the bathrooms. 4 bdrm, 2 bath, office Asking price was 125k and I offered 150k. I was willing to move. They are out there.

      • Depth Charge says:

        Hahaha! They were offering to sell you a house for $125,000 so you thought you’d counter with $150k? Unbelievable. Nothing like pissing money away…

        • Lynn says:

          Different “Lynn”. Honestly, I’d be ashamed.

        • Depth Charge says:

          “Different “Lynn”. Honestly, I’d be ashamed.”

          Let’s call you “Logical Lynn.”

        • BuySome says:

          In the normal calm between wars, it would seem crazy. But in a hail of gunfire, Lynn has brought a tactical nuclear weapon to the battlefield. There just might be some solace in knowing nothing can cross the wasteland in-between. Insane? Perhaps. But how to measure when walking the razor’s edge between nuts and genius?

      • Lynn says:

        Hey, You’re not me. I guess I’ll have to change my name. Maybe formerly known as Lynn or something.

        Or maybe you might, unless you want to assume all my political and pitchfork sentiments.

        • Wolf Richter says:

          Lynn,

          Yes, this gets very confusing. Something like Lynn01 would work, if you don’t want to have a long screen name, such as your proposed “formerly known as Lynn or something,” which would be very cute too.

      • Michael Gorback says:

        Why did you offer so much over the ask?

  10. George Adlam says:

    The Fed has no intention of tapering at all .They might nudge the over night rate but increase there asset buying QE has never stopped it can’t until they are ready .then create a crises to forfil there end game

    • Wolf Richter says:

      George Adlam,

      “QE has never stopped”

      This is total nonsense. QE stopped the first time in 2014, and the assets then remained flat until late 2017, when the Fed started shedding assets through Aug 2019.

      • DawnsEarlyLight says:

        True, but QE is nonsense!

        • william says:

          QEing is what banana republics do! America has somewhat getting away with it due to the ww2 aftermath of Bretton Woods gift of Reserve Currency! However, as usual a Not-Agreement-Capable broke the Bretton’s wood gift and went off the gold standard! When, and it’s not if, a structurally broken America loses Reserve Currency status Lebanon and Argentina will look like they are rock soild economies!

    • jon says:

      The FED would do a drama/ charade of tapering and hiking rates but they won’t do it really meaningfully.
      If they are honest, they’d se inflation at 15% or more, not 5% their manipulated numbers report.

      Just remember, for whom the FED works for.

      • Old School says:

        Steve Hanke says primary factor in inflation is money creation and that 12% inflation is already baked into the cake, but exact timing is tough. Might be 4% in flatiron for three years or 6% for two years or 9% for 18 months, but it’s here and we are going to get more of it.

  11. boikin says:

    I am surprised any houses are being finished right now, I am in process of having a house built and my builder says it is like herding cats trying build a house right now. Simple things like soffits are out of stock and then as soon their back in stock the soffit subs are not working. I think he is process of building 3 houses right now each a different stages and all are delayed because of some random shortage. These are all custom homes so they are already sold, but if I was looking a buy a new home there is no way I would be looking at new construction having no idea when it could be finished. And just for information we started this house in the winter of 2020 before things when crazy(but actual work did not begin till much later in the year). It will end up taking 2 years probably for us to get an under 2000 sqft house built when it is all said and done.

    • DawnsEarlyLight says:

      Do you have a maximum time to completion in your contract?

      • boikin says:

        No, but they said as of right now should be done by the end of year which is fine for us, we were never in a rush. That brings up another problem for the house builders all the commercial jobs take priority for the subs since they all time deadlines.

    • AdamSmith says:

      I have been a General Contractor for decades. Spoke to a young guy in the market asking what was happening on the ground (especially how construction people could afford 100K trucks).

      His answer on the trucks was people buying with refi money on the trucks.

      On what was happening on the ground was something I have never heard of having been a builder since 1974. He said project managers/superintendents were quitting left and right because they had contracts on say all the garage doors in a new housing tract but could not get any units to complete the job OR they had the units ready but the job they were to be installed in was held up because of another item still not available needing installation before the contractor waiting to install could execute.

      However this happens I do not see it possible to have a soft landing.
      It also seems foolish to think of any kind of “landing” of the economic plane other than saying the landing gear will not execute to prepare for a “crash” landing. That is what is on everyone’s mind because there is no pattern to follow or precedent that can be used in a hyper-economic evolution.

      One thing that seems clear is that the serious chaos has just kicked off and the carnage will be breathtaking to behold….

      • SnakeEater says:

        Most can’t afford those trucks. They are bought because they qualify for a section 179 deduction from the IRS, which is huge for a small business. It allows you to depreciate the entire 100k value of the truck in 1 year. For a small LLC, it might mean you don’t pay any taxes that year.

        • AdamSmith says:

          Yes, I have used this excellent write-off many times…..
          But here I am talking about guys who do not own businesses doing this and still using the refi money for the truck which is most of what I see…. This means there will be a big availability in the years ahead when the owners cannot even afford the maintenance, insurance, and tires without great pain.

          When I had Bobcats for a company called RanchHandEnterprises I had a Monster one ton 4 x 4 Dodge Diesel Ram (45K), a one ton Diesel Dodge Dually (35K), and a 3/4 ton, diesel Dodge ram long bed (34K) which were 2004,5,6 and now this is the value of one fully loaded 1 ton 4×4 Dodge diesel pickup. This including two Bobcat units and 20+++ attachments, trailers, and power equipment used in developing SoCal horse ranches from Malibu to Palm Springs, From the High Desert to San Diego County s and now this operation would require about 500K to start…. It just boggles my mind how the modern day guy could get to this spot from the multiple refis I had to used to build this mini empire of working on high dollar English horses in Los Angeles.

          Then the Great Recession set in and after three close calls on loosing my ranch I still am standing in a good retirement and cannot believe how this has unraveled so quickly.

          So, now, how much worse can this get? I am much more able to say it will crash than I can see anything to save most….

          No small investor will be able to do well (except those like Wolf)

          Wolf has inspired me to pursue statistical training and to apply it to numerous data categories to infer REALITY

    • MiTurn says:

      “Simple things like soffits are out of stock…”

      Boikin,

      My son is an electrical contractor and he says that the supply problem is a nightmare. So he’s learned to keep extra stock on hand, and then keeps them on backorder at his supplies so he’s always first in line when stuff comes in. He’d prefer not to tie up so much money in material, but it seems like the best plan for right now.

      • Wolf Richter says:

        MiTurn,

        What your son is doing — “keep extra stock on hand” — is a logical smart response to shortages. It’s called “hoarding,” and if everyone is doing it, it makes the shortages even worse, or causes them in the first place.

        • BuySome says:

          One man’s “hoarding” is another’s “strategic investment”. Especially when “E Pluribus Unum” has been replaced with “War Is Hell” on the paper. This change courtesy the marketing office that brought us Department of Defense (previously, War Department). Sandbags or electrical supplies, all a “defensive” posture in the face of an unpredictable enemy hiding behind marble columns.

        • VintageVNvet says:

          NO Wolf, it is called ”stocking” as was and has been done by prudent ”contractors” for many many decades before the total nonsense of ”just in time” became the mantra…
          Please do NOT knock the prudent and prepared contractors, many or most of whom have come up from the ditches and have seen this current scenario before, in some cases many times before.
          And Please understand why, if you call to have something or anything done for your IT or APT, you may find the ONLY ”contractor” who can do it sooner rather than later, is going to charge a bit or a bunch more than the ”contractor” who does not have any inventory,,, etc., etc…
          Knowing you are a young boomer Wolf, I do not denigrate your not understanding many older folks who have been through similar ”shortages” many times, most of them a result of managed intentions by manufacturers and middle folks, as these current shortages clearly are at least in major aspects…

        • Depth Charge says:

          Yep. The hoarding is causing a bunch of false demand. A guy normally orders 6 items. When he goes to get the 6 items there are only 2 available. So, he asks the supplier if he can get the other 4. The supplier says yes, he can have the next 4 the following week. Anticipating the need for another 6 the following week, but also worrying about future shortages, the customer decides to order 60, though that is 10 weeks worth.

          Having multiple customers suddenly wanting to order 60 instead of 6, the supplier puts in a positively massive order of 6,000 to the distributor instead of the normal 600. The distributor thinks that demand has suddenly gone parabolic, and they notify the manufacturer to ramp up production to meet this newfound increase in demand, when there’s actually never been an increase in actual demand. Then, GLUT.

          That’s what’s coming – MASSIVE GLUTS.

        • Wolf Richter says:

          Can’t wait for that massive glut of WOLF STREET beer mugs that I ordered on May 31 and that I may get maybe sometime next near.

        • RightNYer says:

          Depth, yes, exactly. And that’s going to happen with housing too. The population hasn’t increased substantially in the last 2 years, so the argument that there is such increased demand for houses is nonsense. People are buying them intending to flip them. Ultimately, no one is going to pay the carrying costs on empty houses, so these will hit the market at some point.

    • Jon says:

      I’m friend in San Diego wants to buy a brand new home for $1.2 million usd

      But the appointment to tour the new home is weeks out
      Such is the craziness here

  12. tom15 says:

    My business is tied to construction. In close to 30yrs we have NEVER been this backlogged with work. This is the 1st time our business has turned away more jobs than we have accepted. How do you finish a home when you have been waiting for 6 months for a door? Need that garage door?
    Take what they have or wait…with no time frame given. Plumbing supplys??!! The list goes on and on.

    I’m shocked the numbers are not worse.

    Let us all hope our food supply, and power delivery holds up better than construction.

    • JWB says:

      The Gov N just signed in legislation last week making it easier to put an ADU or three on most any previously zoned SFR lot. We have an acre down near Carmel here. I am in real estate here with impressive connections in the construction community. My first choice architect with whom we share a former CEO of a national bank among others took a day and a half to get back to me saying he will try calling me next week about my possibly getting on his schedual. The septic guy came out right away but the engineer for the required upgrade to add just one ADU with one bedroom says he and everyone else can’t touch the project for at least three to four months. Has to do with new statewide septic regulations. The GC who is a client has now gone almost five hours with no getting back to me which has to be more painful to him than to me. And the loan officer with the special ADU financing program can’t do a thing without the cost estimate from the GC. If we had everything ready to go today with permits in hand, I bet we’d still be a good 10 to 12 months out from being able to offer exceptionally nice rental housing in a marketplace desperate for it from an experienced landlady who knows to rent under market to get a great longterm renter. This is just a clusterblank all around.

      • Lynn says:

        My first thought is your architect doesn’t know the regulations yet or what he needs to order or where for septic components in order to fit regulations. I’d call the septic guy again and see if he knows them. In my area of California most septic guys know and are the only ones who design any system. Even the PITA above ground systems. They also know the local environmental health guys the best. It would probably be cheaper and more efficient to leave your architect out of designing the septic systems as well.

      • Kyle says:

        Build it slowly and quietly without a permit using recycled old material. “It is what it is” is a term that originated when such places were discovered decades later.

      • Anthony A. says:

        What’s an ADU?

        • AdamSmith says:

          Accessory Dwelling Unit also known as granny flats, or converted garage units now known to mean a small cheap place to rent or keep your mother-in-law or ????

        • Anthony A. says:

          Adam, thanks for the clarification.

    • sc7 says:

      Exactly, everyone is missing the “unfinished” element in this article, as usual. Another moving of the goalposts and surely this data is a sign of the coming “big crash”.

      As new construction gets finished up here in the Boston area, they’re getting snapped up within a day or two.

  13. 2BFrank says:

    Evergrande has 30 days written in to its covenant before it is considered in default, so technically it wont default on its dollar denominated bonds until Oct, in their situation they will delay paying right up until they default or pay up.

  14. David Hall says:

    “The inventory of homes actively for sale in the 50 largest U.S. metros overall decreased by 20.7% over last year in August…” Realtor(.)com, Sept 22, 2021

  15. Augustus Frost says:

    It’s only because of the loosest credit conditions ever and very lax mortgage standards that these prices are “affordable”. This “affordability” is actually debt serfdom for anyone with limited housing equity or relying on the predominantly fake economy to service their mortgage.

    No, current mortgage standards are not strict, except compared to the non-existent standards of housing bubble 1. Neither is the “traditional” 80/20 loan underwritten at the level bubble prices existing now.

  16. Memento mori says:

    Wolf, you have been wrong on this for so long that I think its fair to question your credibility here.
    You have no idea of the frenzy out there.
    Any slowdown is because of lack of decent inventory.
    As saving culture has been annihilated by the Fed policies, housing is the only inflation hedge for the average Joe.
    Look to Canada what is in store for the US, home prices could well double from here within 5 years.
    Credo quia absurdum.

    • RightNYer says:

      I heard the same things in 2007 and 2008 as well. “Lack of decent inventory” only means “at a price mutually agreeable to buyers and sellers.” If buyers aren’t willing to buy at the prices sellers are demanding, prices drop. Things sit on the market for months before sellers start dropping prices. That’s how it starts.

      • Nathan Dumbrowski says:

        Neighbor in SoCal (Simi Valley, CA) listed his condo and within one week sold for $10k over listing. This market here is al fuego. I recall purchasing my first home (4br/3ba) for $370k back in early 2000s. Thinking this was the top. Now a 2br/2ba condo is selling for more

        Where do we go from here

      • Auldyin says:

        @RNY
        Prior to 2008 we had an ordinary punter bragging in the bar that he bought 4 houses off plan at 10% down and 30yr mortgage.
        Only place I’ve seen the likes of that this time round is maybe Evergrande.
        By the way, that guy was never seen again in the bar after 2008.

    • Paulo says:

      After reaching an all-time high in March 2021, the average sold price of a home in Canada has slid for three straight months to end up at $679,051 for June 2021, a drop of 5.5% from the peak of $716,828 back in March.

      $679,051 X .8 = $543,240 in US dollars or $100K more. approx 20% more expensive in Canada.

      82.66% urban in US
      81.56% urban in Canada….that part is almost the same

      The only real diff I see is in general the price of raw land is higher in Canada due to most of Canada being Crown Land or designated non development, and that labour is paid more, plus no undocumented framers, roofers, etc. Of course all fixtures bought offshore would also be purchased with a lower valued CDN dollar as well.

      Seems pretty close to me.

      Most expensive RE is on BC west coast where the climate is mild. We also do not have huge national const companies building single family with few exceptions like Seymour Pacific, etc. The biggies usually build apartments and condos. Most home construction is local sourced.

      • Trailer Trash says:

        “82.66% urban in US”

        It’s really that high? I hope they stay there, for the most part. During the First Great Depression many urbanites had relatives out in the countryside and moved back to the farm because they had no rent money. This probably didn’t happen much in the Dust Bowl but in other rural areas.

        It will be interesting to see how many people move back to rural areas over the next few years.

        • BuySome says:

          Unfortunately, the events of the ’30’s drove more people into cities than out of them. Some held onto their farms by getting jobs paying cash while leasing out the old lands to big concerns. Far more help wanted signs in Megaville than CornTown. The direction of travel lies in the rent that comes due at the end of the month….assuming rent must be paid.

      • Lynn says:

        “raw land is higher in Canada due to most of Canada being Crown Land”

        Wow. That’s right. You still have a queen. Pretty impressive how much one family owns. Well, not much different here really, a lot of land is owned by BLM or by huge landholders that never sell.

    • Wolf Richter says:

      Memento mori,

      Read the friggin’ article before you post idiotic braindead comments. Adios.

    • Swamp Creature says:

      Memento mori

      The lack of inventory is due to the fact that there are a lot of people owning two homes at once. There are many reasons why are doing this , but easy money is one of them. When this unravels, there will be plenty of homes for sale. This is a ticking time bomb. We do appraisals in the DC Swamp and nearly every home, (85 – 90%) we look at are unoccupied. The owner owns the home we are appraising plus the home they have just bought.

      • Mendocino Coast says:

        Great Post I was thinking perhaps that was happening .
        I wonder just how many of that 85 – 90% of unoccupied are actualy Speculators rather then Not ?
        I am not Rich but have owned 3 Homes at a time just because I like liveing in differant Places during differant seasons of the year .
        Last House I bought in Las Vegas (2012 From Wells Fargo ) a nice 4 bedroom Home I paid $62,250 Cash for a Mild fixer as I like to play Poker sometimes during winter Months , since sold the place .
        Most Likley the Number of “Speculators” is Very hi compaired to not .

      • Lynn says:

        I’m also wondering how many are speculators who own more than 2 empty homes. I think they might not volunteer that info.

      • Mojer says:

        A reasoning like what they do to Chinese investors because it is their almost only possible investment, strange times in the “free” world

      • Old School says:

        You are hearing a lot of financial commentators telling people to own something real. I suspect a lot of upper middle class who rode out the stock market now have a multi-million dollar portfolio and desire to put a portion of that into real estate.

        • RightNYer says:

          Old School, I’ve heard this argument before, but I’m not buying it. In my anecdotal experience, people rarely actually sell their stocks to put the gains into real estate or anything else. Rather, their stock gains embolden them to spend cash they have or taking on additional debt to buy other things, whether houses, cars, boats, jewelry, etc. Their thought process is “Might as well spend the money, I can always sell some of my stock if I need the cash.”

          This is the “wealth effect,” where unrealized gains cause people to spend money. The problem with it is, the unrealized gains can collapse in a heartbeat, and then the money is already spent or the debt already incurred.

        • BuySome says:

          I’d venture that at the top of faulty towers, a barber shop has been clipping one hell of a lot of hair for a good while now. We just don’t know whose heads keep getting shaved everytime they pump the handle of the chair before releasing the pressure valve. But I’m guessing Ma & Pa Kettle aren’t tossing their eggs directly into the basket. On the other hand, let’s hope they haven’t given Junior the keys to the tractor or they may find the fields have been plowed low in preparation for filling in a lake when the storms set in…the grandkids tend to think that every lake front property is a future health resort. Most can’t spot the difference between a used car salesman in a plaid vest and a guy selling magic beans in a tuxedo. The only alteration of this old tale is that the names are changed to protect the innocent. But the show must go on.

      • jm says:

        Brokerages catering to the very well-to-do offer accounts that let you write checks against the value of your securities, in effect taking a margin loan whenever you want. Thanks to the incredible inflation in stock prices many people have acounts nominally worth several million, and so can borrow half a million just by writing a check, at a quite low rate (compared to the expected 20% annual home price rise). They don’t have to sell their stocks, which they know also will keep rising 20% a year.

        And they know both the home price and stock prices are protected from loss by the Fed–that though they may drop transiently, will be inflated back up to even higher levels if the just hold on for a while. Like a Nomura Securities fellow in a very expensive Italian suit was explaining to a gaggle of exquisitely coiffed and dressed Japanese ladies on an NHK TV investment advice show back in 1989 when I happened to turn on the TV upon arriving at my hotel in Tokyo one Saturday morn, “No one has ever lost money in the Japanese stock market if they’ve stayed invested at least three years.” All the ladies bowed in unison, softly saying, “Ha” (i.e., “Yes, I understand”).
        https://www.google.com/search?q=nikkei+stock+indexes&oq=nikkei+stock+indexes&aqs=chrome..69i57.17887j0j8&client=tablet-android-samsung&sourceid=chrome-mobile&ie=UTF-8

    • sc7 says:

      Spot on, the endless doom narratives around housing have been wildly incorrect year after year, while you and SoCalJim have been spot on.

      • Old School says:

        That’s true, but something is smelly in Denmark. All asset values must in the long term be built on future income whether it’s a stock or a house.

        As the stock goes to 30 times income or the house is bought for 10 times income the asset is very vulnerable to an economic shock. It is being papered over with massive government spending right now, but never bet the farm on politics.

  17. El Katz says:

    Example of supply chain:

    Called a supplier today to order undermount cabinet drawer slides for a project. Out of stock. I asked the owner when he expected receiving stock. He laughed and said “Presently, November 26th…. but I’m lying to you. I have no idea”. This particular product is made in the U.S.A., so not subject to the port container debacle.

    Then he proceeds to tell me that a woman just bought an entire cabinet in order to cannibalize the trash pull out and have her kitchen finished. Additional cost was $300 over what she would have paid for the pullout alone.

    • Trailer Trash says:

      Pretty scary to think that basic items like drawer slides are unavailable. I recently ordered a toilet from Home Despot to be delivered to my home next week. There seems to be plenty of toilets at reasonable prices.

      • COWG says:

        TT,

        Localized…Crap ton available here in SW FL…

        I do think all the profiteers with the hold off the market second homes have sucked up a lot of building materials/ appliances/ AC/ plumbing etc trying to get the most money while prices are high…

        Puts them in direct conflict with builders for such…

        Add in Wu Flu handling incompetence, the Federal ( we decide who) Deserves, the gimme-lus, and sure enough, it’s a friggin’ zoo…

  18. J-Pow!!! says:

    What’s wrong with you people! Clearly this is a good time to buy a home! Home prices only go up! Buy now before you’re priced out for ever! I’m clearly creating hyperinflation! It’s not as if anyone is using this word to create a bubble out of fear and make money! Buy now before we run out of lumber! Buy! Buy! Buy! Hahahahahahahahahaha!!!!!!!!!

    • Mendocino Coast says:

      J-Pow!!!
      Sep 24, 2021 at 3:18 pm
      What’s wrong with you people!
      What’s wrong is that the Government has stagnated Opertinunty by eliminating Opportunities , Quality of life theme for personal Gain strange as that may seem and getting away with it .
         LOL LOL LOL HA HA HA    
      Your J-Pow   so you Know that humm wait is that funny ? 

  19. Gabby Cat says:

    We are trying to decide who we should build with. Some are giving us 16 month time frames and other are at 8. None offer appliances and require you to do the work for finding them. The number never falls from shifting prices due to lumber. When the price went down in lumber the builders all around Central Ohio notified of higher prices. Everyone that we know not in the market tell us to wait – it will crash. However, bankers say the 2008 crash will never happen on American soil again. New investment firms purchase foreclosures so they do not hit the market. Single family homes are allowed to be purchased as multifamily units. Supply and demand is a beast in this market. We are on the sidelines not sure if we should try to build or wait. We think these may be individuals profiting from the insanity. We are shocked at the sticker prices for houses that do not meet the normal family of four requirements.

    • Lynn says:

      “New investment firms purchase foreclosures so they do not hit the market. ”

      Son of a B. So that’s what I saw..

      “Single family homes are allowed to be purchased as multifamily units.”

      That sounds like corruption with dept of Ag and HUD loans.

      • Gabby Cat says:

        AG and HUD are at the mercy of the Dodd/Frank monster that made this finance option available. It is federal law to discriminate against financing impoverished citizens. Therefore, four working adults qualify for a three bedroom 1200 SF home in Central Ohio. They must have 20% down and cash to cover the gap. First time home buyers, using FHA, qualify up to 10% down in grant money. In addition, Amazon employees qualify for an additional 5% home ownership aid. This is given to qualifying employees. It’s unclear if it’s a grant or paycheck allowance, but no loan showed on the applicants paperwork. I can tell you that the one adult not on the loan application is the one that worked at Amazon. The family that bought the home has three generations living in the home. That is 6 adults and 2 kids. The subdivision is now 80% that way. The families are super sweet and care for all of their neighbors. The HOA on the other hand have lost all control of the laws due to language issues. Then those who do not have large families are stuck without a house price they can afford and no options to own a home. It seems the Government, no matter the good intentions, can never truly help the poor American. They need enforce old anti-trust laws, breaking monopolies, and price gouging. Did I mention the family, all American Citizens who escaped a small country in north India, all received free college tuition? I digress….

    • Old School says:

      Safest thing to do is find an already constructed house when the market is a buyers market if you can be patient. I know some people who got screwed royally by building their dream home.

  20. Stan Sexton says:

    Where are Invitation Homes, Blackstone and Blackrock who buy homes for rentals? The market must be down.

    • Wolf Richter says:

      They’re not buying homes and converting them to rentals. They BUILD new homes — “entire neighborhoods” namely entire subdivisions — for rentals now. And they buy companies that already own large rental portfolios. And BlackRock had nothing to do with this. These nonsense headlines never die once people get them into their minds. So please read this article:

      https://wolfstreet.com/2021/06/22/no-blackstone-didnt-buy-17000-houses-out-from-under-desperate-homebuyers-and-blackrock-didnt-buy-a-whole-neighborhood-but-built-to-rent-is-a-h/

      • jon says:

        Thanks Wolf.

        But the bottom-line is: Big corps with deep pockets are owning more and more single family homes so that hey can rent to people.
        These companies have access to cheap money, are deep pocket and they believe that home prices would go up and rents would keep going up as well.

        • Wolf Richter says:

          Yes, but they don’t really care about home prices; they care about rents.

        • MCH says:

          Sounds very much like they care about the yield, all the way up till the point when the underlying collapses.

          Heh heh. But then, their advantage is cheaper debt… would be curious to see how the larger guys roll over the debt, would they have access to the discount window? (I am only kind of kidding here)

          I wonder if repo money could be useful here somehow.

      • roddy6667 says:

        My recently retired brother fled from CT to Traveler’s Rest, SC. He doesn’t want to be bothered with home ownership right now, so he rented a new home just 3 doors down from his son. The entire new neighborhood was built for rent. I don’t know who the developer is. He just deals with the management company.

  21. Seneca's Cliff says:

    In the subdivision where my son has a partially built home reserved the big ( one of big three) home builder developing the project and building the homes is selling off the model homes in the “model home village” and the project is not nearly built out yet ( they still need the models to continue selling more homes). He asked the sales person about it ( who looked exasperated) and she said it was because headquarters was desperate for closings by the end of the year to keep the financials from looking bad. These model homes were the only ones complete enough to sell right now.

  22. JWB says:

    And regarding cars, my Jeep has been in the shop since July 20 after someone hit the back driver’s side. The good news includes I was driving a Jeep at the time and so was able to walk away just ticked off. The bad news includes the worst of all for parts right now is Chrysler according to the shop. My brain can’t sort much of this out other than we have demand stimulated by artificial means?

    • Seneca's Cliff says:

      My friend had a small collision in his 20 year old Jeep in July also, but the body shop and insurance company said it was a write off because many of the parts are no longer available. I just had an alternator, belt and idler pulley go bad on my 28 year old Mercedes diesel and the good news is all the parts are available same day from the factory parts network, but the shop can’t fit me in till early October since they are so busy.

      • Mike G says:

        Some carmakers with healthy “classic” markets are diligent at keeping parts inventories for decades – Mercedes, Porsche, etc. Others are infamous for discontinuing parts early, like FCA and Nissan. Which doesn’t seem like a vote of confidence for the durability of their products.

        • COWG says:

          Well supplied and reasonably priced for my ‘06 BMW…

          Some speciality parts are expensive but available…

          eBay fills in nicely for that…

        • Auldyin says:

          @MG
          I thought some guy in the States was still building 70’s Datsun 240Z’s.
          Did that fizzle? Sad.

      • Rick G says:

        You can’t do this yourself? Simple things, probably a few wrenches.
        Try aftermarket.

  23. DougP says:

    If I read this article correctly, this is not about the housing market slowing at all but rather a shortage of supplies issue. Supply chain rather than housing?

    If that is correct then this is not an indicator of any change in the housing market, yes?

    • jon says:

      Govt stops free money to people and raise the mortgage rates. All supply chain issue would go away

    • Wolf Richter says:

      DougP,

      Yes, the market for new houses is completely screwed up by massive supply chain issues, and possibly labor issues. At this point, it is difficult to sort out demand as an isolated item amid all this.

      We have a similar situation for the auto industry, where new vehicle sales plunged in recent months to multi-year lows, prices soared, and inventories are totally depleted because of the chip shortages. It’s hard to get a clear picture of demand under these conditions.

      But unlike homebuilders, automakers cannot sell unfinished vehicles :-]

    • Wolf Richter says:

      DougP,

      My second try, with a chart now, to demonstrate the supply chain issues:

      The chart below shows the percentage of completed houses in total inventory for sale (total inventory for sale = not started + under construction + completed). In the article, I mentioned that 90.5% of the houses in inventory were either under construction or not started. This chart is the inverse: completed houses, and they’re down to 9.5% of total inventory:

      • DougP says:

        Thanks Wolf, (and others) I’m just trying to understand all of this.

      • Trailer Trash says:

        ” (total inventory for sale = not started + under construction + completed)”

        Why does “Not Started” smell so foul to my cynical nose?

        A contract to build a house would be an asset with value, but this “Not Started” business seems to be something different. Does a file folder of permits and permits in progress get assigned a value? Does there have to be actual land assigned to a “not started” house?”

        I have a widget manufacturing company and next year I plan to build a million widgets so I’ll go ahead and add the value of a million widgets to my inventory today. The bank will like that.

        • Wolf Richter says:

          Trailer Trash,

          This is standard industry practice. You can buy a house where construction has not started yet, no problem. Many houses are sold that way. You go to a builder’s subdivision, and you pick out a lot and specify things like the floor plan, the finishes (granite countertops vs. quartz, this type of faucet v. that type, flooring, etc.) plus appliances and other things that the builder lets you choose, and you put some money down, and the builder thereby sold you a house where construction hasn’t started yet.

          Until the builder sells this not-started house, it is in their inventory for sale. The value at which the builder carries this house is not part of this article. Generally, builders carry their inventory at cost, and they already have some cost in this property, including planning, the land, infrastructure, etc.

        • VintageVNvet says:

          Common arrangement here in the saintly part of the TPA bay area TT:
          Builder buys and demos an older house with many issues, FKA ”problems”,, and lists the home they prefer to build back better;
          buyer buys before building begins because better price before building begins:::
          Win win win until the wind wind wind begins and even the winds of the ‘canes does not harm the new build due to the new build being built better,,, of which there is NO doubt these days, as the new builds meet all the engineering needed to withstand all most all of the ‘canes ever, SO FAR…

        • Auldyin says:

          @TT
          Common practise in UK called “Off Plan” buying.
          All the best plots get snapped up first. The least favourable plots are built lastand sometimes have to be discounted to get rid.

      • sc7 says:

        Too bad so many commenters didn’t bother to actually read this analysis and latched on to “inventory up”.

  24. Seneca's cliff says:

    Everybody seems to have a complicated explanation for the shortages of everything in every nook and cranny of the economy. But I think it boils down to a simple principle first introduced to me by my grandfather back on the farm as a boy. Too many people riding in the cart and not enough people pulling. For the last 40 years we have told ourselves a fairy tale that insurance salesmen, social influencers, marketing execs and finance people are just as important ( or more so based on how we choose to pay them) as truck drivers, machinists, farmers, sawmill workers and longshoremen. We have promoted the idea that everyone can be a “knowledge worker” or learn to code. But now we are learning. the hard way, that this is not true. We have confused fluff with substance and will pay the price for many years ( if not a generation).

    • TheRealMRDyno says:

      Watch the last of the hunger games movies, and tell me someone didn’t make the whole thing from the thought you’ve expressed here.

    • historicus says:

      Absolutely correct.
      The Fed is doing nothing more than emptying out the pockets of future generations.
      There is a safeguard for this not happening….
      the Fed is supposed to “promote moderate long term rates” ( the 3rd unmentioned mandate). Moderate means not extreme, either too high or too low. Too low, immoderate rates, allow the irresponsible debt creation that steals from the future. This is why this mandate is always carved out of discussion with the “dual mandate” game of just mentioning the first two mandates in the Fed mission statement.

    • AdamSmith says:

      I agree with you except for one critical thing.
      The immigrants work harder than almost all natives because the natives are spoiled.
      The old, like you and me grew up in different circumstances that are no longer relevant.
      The young immigrants are the only ones you want to hire because they actually work and are grateful to have it….
      Mind you I can outwork most anyone even at 66 years old and I say to you the reality we grew up with is GONE….
      I have decided to live in the now rather than the future but know I cherish the point of view you have but it does not work anymore and is not the reality on the ground.

      • historicus says:

        The work ethic that young men used to grow up with in this country has been missing in many instances.
        Latino immigrants, at least in my area, are the workers…..
        to their great credit.

      • Seneca’s Cliff says:

        I agree with your point about the diminishment of the work ethic, but I don’t think that it is as important as the choices we have made about what work is important. A good example happened to me this week. I went to UPS ship location ( a big one next to the main terminal) to drop off some parts that were being shipped to keep part of a plant in production that makes analog chips ( many for autos). In front of me was some kind of event planner lady berating the clerk about the cake topper ( or something like that) she was waiting for. She wanted the clerk to contact the route driver and have him divert to meet her so she could get her cake topper in time. In the meantime the minutes were ticking by before my parts would miss the ship time and the chip plant would be down another day. Can you imagine that happening with plane parts during WWII or gaskets for the Apollo mission.

        • BuySome says:

          SC-In the past, transportation was about 8%+ of the Oregon economy. U(of)O had one of the nation’s lead profs. on trans. until he went emeritus and then bye-bye. Also libraried an immense catalogue over these subjects. But come the ’90’s, the business department became concerned more and more with stock crap and so-called investing. The state’s direction became an adjunct of outsider influences and spending projects that fill up chain motel vacancies with hard hats from Tejas et al. Got to get those room taxes, never mind that so much stuff from outside the nation will end up occupying those triple rigs wizzin’ down the highways between coastal urban giants. (The spellchick just tried to blame it on a baseball team in Wolf’s neck, but I slapped her capitalizing claws down. Humans-1, Electrodams-O.) Just expect things to get worse. We ain’t farmin’ Kansas no more. It’s all balloons to the Emerald City fairgrounds now.

      • Ron says:

        America has always been built by the immigrants as they usually have nothing start on bottom and climb social ladder then get lazy

      • kenny says:

        The truth and nothing but TRUTH . Well said

    • Jj says:

      Yes. Now that millennials and genz have discovered the market, no one wants (or needs) to work. The market will have to crash to induce the need to work again.

      You said it better Seneca…

  25. Michael Gorback says:

    My contractor called today. He was supposed to convert my patio into a sun room using koblenz beer mugs but he was only able to get 500 of them so we’re on hold.

  26. SocalJim says:

    I have only seen a slowdown in certain homes. Basically, the multiple offers on a home in a defective location have really cooled. Some defection location homes are sitting for a little while before they get that offer.

    However, often, better locations are still a bidding war. But, the bidding war is taking place with fewer offers.

    In my opinion, more price gains are ahead, but more selective and smaller.

    However, SB9 is very interesting. Many speculate that the small homes on large lots near the SoCal beach are in play and in a big way. I expect this might be true, but no data till 2022.

    • I’ve got a lot which isn’t economically feasible to develop, (still 10 miles from the ocean) but I am going to explore SB9 for options. They said in the boilerplate they only expected to change the outcome in a small number of cases. Beach property is not low income housing, it will be interesting to see if this is just another loophole for the rich.

    • sc7 says:

      WolfStreet’s most accurate housing commenter here, let’s see if this prediction also holds true.

  27. Brent says:

    Well,according to Social Security Wage Statistics only 1.6% of population will be able to pay their mortgages, considering average house price $400K and historical lending rule of thumb: mortgage=2.2x annual family income.

    https://www.ssa.gov/cgi-bin/netcomp.cgi?year=2019

    In the late 40’s first houses in Levittown,NY were selling for $8K.Workers were making $3K per year,engineers $5K per year…

    In October 1945 Department of Defense cancelled almost all war orders and industrial wages instantly dropped from $2 per hour to 50cents per hour…

    Paying off mortgages was no fun,no fun at all-even back then.

    Happy RE flipping Boyzzz & Grrrrlz !!! 😀
    We all ought to be rich…

  28. historicus says:

    The Fed tries to pump housing with cheap mortgage rates supported by their MBS purchases. But they also promote an inflation that creates massive problems in the housing industry.

    FOR EVERY ACTION THERE IS AN EQUAL AND OPPOSITE REACTION….and the central bankers are “too smart” to realize it…just ask them.

    It is the same with their cheap money/rates to promote employment. The federal govt borrows at those fairy tale rates and doles it out in a fashion that acts as a disincentive to work. So the Fed’s actions actually have the opposite effect.

    • Mojer says:

      One way to over-shape the economy to recover from the Covid crisis, if it goes wrong it was only because the health crisis has occurred, no one will be held responsible.

      • historicus says:

        No one is EVER held responsible ….
        In our ruling system, those who make bad decisions or engage in malfeasance are not held to account. Not like in the private sector.

        • BuySome says:

          Pan Am, Monkey Wards, Sears, Borders, etcetera, etcetera, etcetera. I think the list might be enough to fill about half the pre-Covid hole in the national debt pool. Of course, we’ve been digging the deep end to Olympic proportions since. We’ll need another couple of kegs for the rest of this party. This one’s about tapped out.

    • drifterprof says:

      Fed owning 2.54 trillion in MBS (fred.stlouisfed) seems bizarre. Seems like only single-digit percent of Americans is concerned or educated enough to know about it.

      According to a 2017 Daily Dose article, the Fed owned $1.77 trillion of MBS, nearly 29 percent of all outstanding MBS.

      I don’t know the place to find current outstanding MBS, but found value of total outstanding mortgage debt in U.S. is 16.96 trillion (Q1 2021, statistica.com)

      So it looks like the Fed owns 2.54/16.96 = 17.3% of ALL outstanding mortgage debt in the United States? What is the process of determining who holds the bag if the MBSs go south?

      Seems like the holders of low interest MBSs aren’t going to be happy if inflation spikes.

      • historicus says:

        They own MBSs yielding almost 3% below inflation…

        and continue to lend to the mortgage industry at these levels ($40 billion a month)

        Who is advising the Fed to do such a thing? It looks like a locked in loser for the Fed….but who benefits? People who own lots of real estate. In 2006 and 1999 we had inflation in this neighborhood, and the 30yr mortgage was 6%, now 3%. Who is advising the Fed to do this? Who might own lots of real estate?

  29. Jaylah says:

    My experience here in Cleveland has been similar with stick-built housing. Recently, I had a great conversation with my friend where he recommended I construct modular homes/buildings. Some of these new modular homebuilders can offer exceptional quality with a guaranteed timetable. Modular homes are built off site and pieced together on site. They can go up in as little as a couple of days. Im actually building a 12 unit, 3 story modular apartment building for around $1,150,000. Financing was also tremendously easier to get for modular construction. The timeline of construction is streamlined and costs are as close to fixed as they get. The quality of these modular buildings is also pretty good in my opinion, 12 foot ceilings, top end fixtures and materials. I rent a crane for usually two days and they assemble the building. Modular buildings do have a bad reputation but it is starting to change. Utilities and insurance are typically lower than stick built as well.

    This article and accompanying statistics do seem to be spot on in my area. New single family homes are being sold for a minimum of 400-500k around me on the west side. This is typically unexpected being that Cleveland is not a hcol area. My real estate agent tells me most of the home buyers are from out of state. As an aside, I still haven’t been able to collect rent from dozens of my tenants. I’ve been held up in court for so long its infuriating. Here’s to hoping things go back to some level of normalcy soon.

    • Old School says:

      I expect some innovation could come to housing (or should I say shelter) but it’s probably too regulated for real innovation. Conventional products can get conventional financing.

    • Seneca’s Cliff says:

      Are you saying that people are moving to Cleveland from out of state to buy expensive houses on purpose?

      • historicus says:

        Somebody has to be on the losing side of a bet.

      • Anthony A. says:

        They have spread out and are past Texas. Next stop, Buffalo, NY.

        • Petunia says:

          NYC already had a modular container home which was recently resold in Brooklyn. This is a big deal because NYC has a very restrictive permitting process for new builds. Look up Carroll House in the New York Post to see it.

    • Paulo says:

      A big low-end apartment building burned downed in a nearby city where I live. As a long time carpenter I would drive by with interest, mainly to see who was building and the progress. Demolition, site prep, and surprise surprise….prefab stick framed walls stacked up on site, an area just big enough to keep the different wall types organised. I was pleased to see fir sheathing as opposed to crap OSB with this method. With proper sheathing winter work can proceed as OSB swells.

      We’ll see. Prefab is nothing new. I remember instant homes setting up in an Alberta sub division I was working on, in 1975. Nothing new at all. The problem is quality control. When everything is subbed out offsite and away from the General watching eyes, you get problems. Problems like discovering the foundation is 3 inches shorter than the plans. So, what rooms did we remove 3″ from when building on site? All I remember is it was a freaking nightmare. These days the project would come to a screeching halt with new designs and permits required.

      I stand with building on site. Sure, you can hire factory workers to shoot up stapled walls on a work floor, but they often over nail, no always over nail with staple and nail guns, and the work is about as good as you might expect.

  30. MikeS says:

    Real Estate is like Strip Clubs, it’s all about location. The supply/demand equation can be vastly different based on zip code and to paint the entire country with one large brush is a fools errand. Supply chain issues are very real and are skewing the data. I have been in the real estate business for 40 years, commercial broker, homebuilder and now land developer.

    I live in PA and have a home in SW FL. I can say without reservation, these two markets are still very strong and SW FL is experiencing a significant inventory shortage of resale and new construction inventory.

    The country is seeing internal migration patterns never before experienced and I believe this is a major cause of inventory imbalance.

    There are so many inputs that can impact the inventory and sales data that to try and explain what is going on at a local or regional level with one chart is difficult if not impossible.

  31. chupakis says:

    Welcome to the Biteme economy and the central planners’ way of managing “infrastructure”. Wouldn’t it be great if we had a President who knew about supply lines, construction, and how a free, private economy functions? Hell, I’d even put up with a nasty tweet or two to live in a first world nation again.

    • Wolf Richter says:

      ” how a free, private economy functions”

      Explain this to Jay Powell. It’s his money printing and asset price inflation that is to a large degree responsible for this.

      • lenert says:

        How much has the rise in derivative financing for housing since passage of the Securities Modernization Act contributed to the cost structure of housing either positively or negatively? It’s been pretty good for fees, yeah?

      • historicus says:

        1000+s

    • TangoOscar says:

      President Trump begged for negative interest rates and started the stimulus checks in the fist place. We were going down this path either way. Collapse is colorblind. Say it with me, overpopulation and resource scarcity. This is why it’s happening globally and not just the United States.

      • 91B20 1stCav (AUS) says:

        Tango-triple-check. A civilization’s population expands to, but generally ignores, the resource limits found by its existing technology, followed by decline and/or collapse. (See ‘Acme’ products and Wile E. Coyote in the old Warner Bros. cartoons for a poor, but entertaining, analogy…).

        may we all find a better day.

  32. Brent says:

    After careful deliberation I decided to adjust my forecast way downwards.With a median family income of around $50K and average house prices $400K only 0.1% of the population will be able to pay off their mortgages.

    Frenzied house flipping,milking HELOC for all it’s worth and search for Greater Fool is the only options left.

    Charles Hugh Smith bothered to look up health care prices at Santa Monica Hospital in 1952 and inserted fee schedule scans in his article.

    Obstetritian costs-$30
    Wards-$16 per day
    DeLuxe hospital rooms-$26 per day

    Nowadays,medical billing practices being what they are,everything is unpredictable,insurance or no insurance…

    Folks who somehow manage to pay off their mortgages should be awarded Congressional Medal of Freedom and Nobel Prize in Economics 😀

    • Wolf Richter says:

      “median family income of around $50K…”

      Median household income in 2020 was $67,521 — Census.

    • Concerned American says:

      Time to eliminate all medical insurance and let consumers negotiate their health care expenses directly with their doctors and medical providers. Only way to drive down health care costs.

      • Michael Gorback says:

        Right after the doctor’s employees agree to pay cuts, the utility rates are slashed, ISPs stop gouging businesses at higher rates, medical supply and pharmaceutical companies cut their prices, payroll companies lower their fees, software companies slash EMR prices, the government allows tax writeoffs for unpaid bills by deadbeat patients, landlords cut rent, malpractice insurance is cut significantly, and everyone is willing to pay cash in advance.

        • Educated but Poor Millennial says:

          Ask doctors to not dream about driving a Ferrari then things will get normal.
          80% of doctors see people as $ sign, no more than that. The remaining do really care about humans.

      • Michael Gorback says:

        But in principle you’re correct: insurance disconnects the consumer from the price. The problem is how do you get the toothpaste back in the tube?

    • OutsideTheBox says:

      Brent

      For perspective…..

      In 1952 my Dad started teaching mathematics at the local public school.

      His first year pay was $ 2000 per YEAR !!!

      With NO medical insurance.

      So those medical prices are still REALLY high for those times.

      • Brent says:

        Santa Monica is posh area of Cali,and,ipso facto,prices are supposed to be higher.But rates were about the same nationwide in 1900-1970 before the LBJ Great Society program struck.

        Child delivery for example was $25 for the doctor & $10 for the nurse.Midwifes charged the same $25 before they became almost extinct.

        As to your Dad making $2000 per year-I have an old issue of Look mag with GM-UAW ad:
        “UAW new contract for 1954,$3.89 per hour.Highest industrial wages in the world !”

        In other words GM assembly worker’s daily wage could pay for a child delivery with something left for Schlitz 6-pack.

        Why and how everything changed for the worse is in the book “Social Transformation of American Medicine” by Paul Starr,Harvard curmudgeon…

      • BuySome says:

        $50K is 25 times that, so if you had 25x$16 in hand today they’d probably show you a card that reads “checkout time at 11am…watch the narrow risers of the stairs on the way out”. (Of course, they would never count cash today so you’d need electro-widget equivalents on a plasto-form card to cross that medical border. Welcome to open-door policy.)

  33. Jim Y says:

    August housing report from a realtor in Sarasota/Manatee county Florida:
    Enormous Buyer Demand Continues into Fall for the Sarasota-Manatee
    Housing Market

    • Concerned American says:

      What else would you e pact from a realtor?

      • RightNYer says:

        Yeah, I’m waiting for someone to post a headline from the National Cattlemen’s Beef Association that red meat is healthy in large quantities.

    • LM says:

      “Fall” as in drop or “fall for” as continuing to be fools and pay exorbitant prices?

  34. RightNYer says:

    I’d support eliminating tort liability for all but recklessness. Immunize doctors for negligence, gross and ordinary, and watch insurance costs drop like a rock.

  35. Marty Milner says:

    You just need one roof over your head and one hot dog stand. Keep it simple. Buy at bottoms and sell at tops, or when you need to reclaim “position size limits” and diversification. TMI is not good for peace of mind. Keep it simple, buy what you understand or something you have a deep understanding of. Rules are changed all the time by the rule makers. Investment ideas should be clearly actionable. JMHO

  36. BuySome says:

    Wait a minute…didn’t Martin Milner buy a new suit to impress a young Liz while financing it all against selling patent dog medicine to his father’s clients, nearly killing his mother? I’d say take a leaf from the John Milner story and keep the yellow rod garaged whenever holiday drunks are appearing in the roads. Who knows, the life you save might be your own, if not James Dean’s. A dangerous blacktop out there…might end up wearing “forty seven miles of barb wire and a cobra snake for a necktie”.

  37. RedRaider says:

    Re: A record 90.5% of the houses for sale are either not started or unfinished.

    So, people trying to sell homes that don’t exist? Why that’s ok. People are trying to buy those homes with money that doesn’t exist (no value).

    Hahahahahaha! You can’t make this stuff up if you tried!

  38. drifterprof says:

    “People are trying to buy those homes with money that doesn’t exist (no value).”

    Ray Dalio: “So, it’s important to realize that 1) most money and credit (especially the fiat money that now exists) has no intrinsic value, 2) it is just journal entries in an accounting system that can easily be changed, 3) the purpose of that system is to help to allocate resources efficiently so that productivity can grow, rewarding both lenders and borrowers, and 4) that system periodically breaks down. As a result, since the beginning of time, all currencies have either been destroyed or devalued.

    Intrinsic value ended in the United States way back when:

    1) LBJ ballooned the national debt by expanding the Vietnam war, which in combination with LBJ’s “Great Society” spending, resulted the United States started bleeding its gold reserves.

    2) U.S. printed more money, devaluing the dollar, which being the world’s reserve currency, made other countries help pay for the U.S. war in Vietnam and a big military industrial expansion.

    Suddenly the U.S. was a crybaby and said the gold standard was no fair because other countries had stocked up on gold.

    The money as a mere accounting system which Dalio speaks of, has been a failure at allocating “resources efficiently so that productivity can grow, rewarding both lenders and borrowers.”

  39. Mira says:

    Unfinished houses ..
    It’s a great time for/if a group of unemployed tradies were to scoop up a few unfinished homes .. finish them off & rent them out .. until they can be sold ?? ..
    Recycled materials are even better than the news stuff & cheaper.
    There is definitely opportunity here for skilled trades men & tinkers even.

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