Which countries have the most rate sensitive household sectors?
Source: BCA, The Longview
Property foreclosure filings have been increasing recently
This is the result of high interest rates resulting in rising mortgage defaults. Source: Game of Trades
US median home prices are contracting aggressively. In just 2 years, the % has gone from over 20% to -7.9%. This is THE sharpest collapse on record
Current levels have occurred ONLY 2 times in the last 60 years: 1. 1970 2. 2008 Both instances ended with equities declining more than 30%. Source: Game of Trades
Prospective California homeowners currently in the market would need to make $221,200 annually to qualify to purchase a median-price, single-story home in California, typically costing $843,600
The latest figures show that California’s housing affordability rates continue to decrease. The figures released during the third quarter are down from 16% in the second quarter of 2023. For comparison, about 56% of California home buyers could afford a home during the first quarter of 2012, the index’s peak high. Source: Wall Street Silver
From The Kobeissi Letter -> Bankruptcy documents show that WeWork, $WE, will immediately break 40 office leases in New York City
Documents also show that WeWork plans to break leases on 70 properties in New York City. Note that 40 of these locations are completely empty. Once a $47 billion company, WeWork still has 700 locations world wide. Could this bankruptcy worsen the commercial real estate crisis?
Mortgage demand is now down 50% from pre-pandemic levels and at its lowest level since 1994
From its peak in 2021, mortgage demand is down ~64%. Current mortgage demand is ~75% below the 2005 peak. The most incredible part of this? Mortgage rates are still only at their historical average. Housing market activity is coming to a halt. Source: The Kobeissi Letter
US Home Prices hit a new all-time high in August while affordability has plummeted to record lows...please explain...
Source: Charlie Bilello
The US housing market conundrum ->
New home sales just surged 12.3% month-over-month in September, the largest jump since August 2022. Even as mortgage rates push above 8% for the first time in 23 years, new home sales are surging. The gap between new home sales and mortgage rates has never been wider. Why is this happening? Explanation by The Kobeissi Letter: -> Homebuilders are taking on some of the cost of higher mortgages AND existing home sales are at their lowest since 2010. New homes are the only option for buyers and homebuilders are helping pay for it. Source: The Kobeissi Letter, www.zerohedge.com
