Today, in my feeds, came this by Wolf Richter of Wolf Street, Sales of New Houses Collapse (in the West by 50%!) Inventories & Supply Spike to High Heaven, Worst since Peak of Housing Bust 1
The whole article is a worthy read, but this graph stands out.
Sales of new, one-family houses plummeted to one-third of sales (300,000, 2010-2012) of where sales were after 9/11 (900,000, 2002), right before Federal Reserve bankers pumped up the residential realty bubble by allowing commercial bankers to make No Doc loans. Sales today are only 56% of that 2002 figure.
The Secular Trend Indictment
Yet, it is even worse than that if you account for the secular trend, i.e., population growth. For a true assessment, those sales points ought to be divided by the population to remove the effects of population growth.
The 2002 USA population was 287.6 million. Today's population is 332.4 million. Thus, population grew 15.6%. Housing sales rate ought to have grown by the same amount from 2002, which would have 1.040 million new one-family houses sold annually.
Instead, roughly half the amount of houses are being sold at that is after a two-year juicing of the residential realty market with Fed Res bankers buying up over $1.3 trillion in mortgage-backed securities between 2020 and early 2022 while having kept interest rates artificially low during that buying period.
Gab It
