Housing

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December Jobs Growth Misses, Wage Growth Still Weak

Yesterday I was musing about the expected rise in inflation and bond yields that so many professional pundits and talking heads are expecting in 2018. That's the story being bantered about on various mainstream cable news puppet shows. Today we received another reality check on that "pent up demand" and overheating labor market story as the December Jobs Report painted a rather lackluster finish to 2017. The BLS Employment Situation showed an increase of 148,000 jobs in December. That's the good news from the establishment survey. The Household survey (Table A) showed an increase of [...]

Misguided Expectations For Inflation And Bond Yields In 2018

The Federal Reserve has proven they are devoid of credibility when it comes to their advertised mandates of full employment and price stability. What the Fed is good at is the same thing it has always been good at...blowing bubbles and serving the interests of Wall Street banks. Thus it should come as no surprise that many of the clueless PhD economists working for the Federal Reserve are calling for an uptick in inflation in 2018. You know, because the labor market is so "tight" and current inflation is still tepid. The Fed of course [...]

Mortgage Interest Deduction In Play, 2018 Housing Market Still Cloudy

The controversial mortgage interest deduction is still in play if you follow the back and forth in DC, and the picture for housing is still rather cloudy. There is a lot which could change depending on what Congress tries to ram through reconciliation in terms of the House and Senate tax sausage. Regardless of what Congress and the GOP approve, you can rest assured it won't stimulate job growth and it won't contribute to long-term economic growth. What we are seeing play out in the halls of DC and Wall Street right now is a [...]

Senate Bill 2 Insufficient Fix For A Broken System

After numerous meetings throughout the state taking copious amounts of public input through the Committee on Property Tax Reform and Relief, Paul Bettencourt has filed Senate Bill 2 dubbed the Texas Property Tax Reform and Relief Act of 2017. Among other things, the bill would require cities and counties to ask for voter approval for any property tax hike greater than 4 percent. More interestingly, the bill will not affect school district taxes. School property taxes make up roughly half of the property tax bill for Texas homeowners. This bill would do nothing to lower [...]

Debt, Deficits & Housing – The Smoke & Mirrors “Recovery”

Many among the status quo have defended the last 8 years as a productive "recovery" from the abyss of financial armageddon unleashed by our criminal banking sector. The efficacy of the recovery depends on the person responding to the question. For the vast majority of the U.S. population, there has been no recovery, but instead a steady decline. If you have been paying attention to the early release of season 5 of 'House of Cards', speaking of the email data dump exposing our corrupt political machine for all to see, the reasons behind the phony [...]

New Home Sales Decline To 511,000 Annual Rate In March

The Census Bureau reported that new home sales for March declined to a seasonally adjusted annual rate of 511,000. This was below expectations of 522,000, but higher than March of last year. The median price of a new home contracted in March was $288,000, a YoY decline of $5,400. The average price of a new home contracted in March was $356,200, $3,500 more than March of 2015. New home sales have remained grounded as the Fed's "wealth effect" continues to diminish within the real economy. New home sales are still hovering around 1991 levels, due [...]

KB Home Q3 Earnings Confirms Shrinking Margins Problem For Homebuilders

KB Home reported third quarter earnings, and the theme of compressing margins was apparent. KB reported revenues that were 43 percent higher and a 25 percent rise in deliveries for the quarter, but the company's profits suffered as a result. KB Home saw their gross profit margin fall from 18.8 percent last year to only 16.2 percent this year. KB cited higher land costs as a primary source of the dent to their profits. While KB's 25 percent rise in deliveries and 19 percent jump in new orders may look impressive in a headline, the [...]

Toll Brothers Discovers “Recovery” Is A Mirage, Stock Drops 7 Percent For The Day On Weak Q3 Results

Luxury home builder Toll Brothers announced FY 2015 third quarter quarter results today. Toll reported that Q3 net income was lower than a year ago with net income falling from $97.7 million to $66.7 million year-over-year. Toll's gross margins for the quarter fell from 22.7 percent last year to 19.8 percent this year. Amusingly, Toll's average price for a home in backlog was $829,000, the first time above $800,000. On a day when a market recovery looked quite possible, it was also interesting to see Toll's stock drop 7.8 percent today. Like many investors were finding [...]

Renter Nation: Multi-Family Permits And Starts Soar In June While Construction Of Single Family Homes Flatlines

The Census Bureau reported housing starts and permits data for June, and it was another case of divergence between single family construction and apartments. The reclassification of America into a renter nation continued in June. Single-family housing starts dipped by roughly one percent from May posting at a rate of 685,000. Multi-family starts jumped from 370,000 last month to 476,000, a rise of 28 percent. This was highest figure YTD and up 55 percent from 2014! While single-family starts look to be stuck in the mud, construction of new apartments is all the rage. In fact [...]

By | 2017-12-22T02:28:23+00:00 July 17th, 2015|Development, Economy, New Home Sales, Real Estate|0 Comments

Lack Of Real Reform Continues To Strangle The Economy, Housing Market

"Washington has become our Versailles, We are ruled, entertained, and informed by courtiers - and the media has evolved into a class of courtiers. The Democrats, like the Republicans, are mostly courtiers. Our pundits and experts, at least those with the prominent public platforms, are courtiers. We are captivated by the hollow stagecraft of political theater as we are ruthlessly stripped of power. It is smoke and mirrors, tricks and con games, and the purpose behind it is deception." Chris Hedges For all of the talk about green shoots and "solid" economic growth, the real [...]