Housing Starts at Another Record Low
Submitted by
CalculatedRisk on Wed, 02/18/2009 - 5:32am (129 comments)
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Nostrovia,
Furst?
anyone short?
Another extremely weak report to be followed by many more...
Wiley E. Coyote just made a hole in the bottom of the canyon. Where's that anvil got to?
Insert caption here _____________
Disastrous. Meanwhile, incomes continue to decline.
Repost from last thread because I think I am a genius
I think we need an order of the Purple House. It will be worn by all those qualify. To qualify:
Mr and Mrs Backbone of America! We salute you!*
I'm confused. With the inventory overhang, why are there any starts at all? Am I missing spacial differentiation of demand and capacity to pay?
C
"Where's that anvil got to?"
Give him a minute to open the damned umbrella...Sheesh!
Nostrovia,
Insert caption here _____________
2im | 02.18.09 - 8:52 am | #
At least Paulson is looking for the anvil.....
I'm a sole-practicioner architect who does residential work. The phone has not rung in weeks for new work. All I'm hearing about from colleagues is layoffs, not projects.
So, I'm thinking these numbers aren't going to improve any time soon.
C,
"Am I missing spacial differentiation of demand and capacity to pay?"
Wrong fiction genre. Build it, and they will come.
Nostrovia,
Eric writes:
anyone short?
Not me, I'm 6'5"
I'm a sole-practitioner architect who does residential work. The phone has not rung in weeks for new work. All I'm hearing about from colleagues is layoffs, not projects.
So, I'm thinking these numbers aren't going to improve any time soon.
What happened in the 1970's to cause that housing boom? Is the graph right?
Sorry for the dupe... I hate HaloScan.
Not me, I'm 6'5"
Dirk | 02.18.09 - 8:54 am | #
Mmm..... Long Pig!
Matthew | 02.18.09 - 8:54 am
demographics. baby boomers
"Insert caption here _____________"
Tuck in the Middle with You
YouTube - S Wheels -stuck in the middle with you
Nostrovia,
What happened in the 1970's to cause that housing boom? Is the graph right?
Matthew | 02.18.09 - 8:54 am | #
1946-1956 plus 25.
What happened in the 1970's to cause that housing boom? Is the graph right?
Matthew | 02.18.09 - 8:54 am | #
Baby boom started in 46, do the math, lots of people moving into prime first time house buyer age then...now not so much, as boomers get ready to retire.
-15????
Nostrovia,
The Order of the Purple House will have an image of Greenspan imbedded in it. When you walk past a real estate agent they will be required to stand up and hug you.
What happened in the 1970's to cause that housing boom? Is the graph right?
Baby boom started buying houses.
That's also a good part of what caused inflation during the 1970s, the wave of boomers entering the workplace.
.
What happened in the 1970's to cause that housing boom? Is the graph right?
Actually it was beavers running amok.
I'm not sure what a housing start is, but it seems like the number of starts must go below the demand before housing can stabilize. In that sense, the drop in the number of housing starts isn't 'weak', but rather, an indication that things are getting better.
Single-family permits were at 335 thousand in January, suggesting single family starts may fall further next month - although total permits were greater than starts, suggesting total starts might increase next month.
In Atlanta, home builders are stopping building way before finish stage. Drying house in, no primer/paint, flooring, sometimes no sheetrock just framing. Shells waitng for offers. Seeing $1 million+ new homes with hand made "for rent" signs. Saw a Bobcat with a for sale sign in front of an occupied $1 million+ home. Rich boys toys selling off
"Total housing starts were at 464 thousand (SAAR) in January, by far the lowest level since the Census Bureau began tracking housing starts in 1959."
And since the population has increased a lot since '59, starts per capita are a lot lower than '59.
I'm not sure what a housing start is, but it seems like the number of starts must go below the demand before housing can stabilize.
That would be zero in this case. Not a good thing if you are in an industry or profession that makes it money from housing
Nice to see you back, Rob.
By the way, CR, are you sleeping these days? Or have you mastered the art of sleep-posting
?
ova,
"That would be zero in this case."
Unless you follow Elvis' plan. He wants to make that a negative.
Nostrovia,
Obama save me.
Eric writes:
anyone short?
Eric
Way short. Will go deeper into shortdom at approx. 1:00, maybe at close, after Obama announces his housing plan. Market will find out there is nothing in there for them, nada, zilch. They'll take their toys and go home.
I propose the Office of Empty Home Destruction...This Federal Agency will go town to town tearing down excess housing which in most cases is worthless from neglect. Kind of like starting over.
Comrade Misean is Dope
That would be better than zero. Somebody has to knock them dow and carry them off
And since the population has increased a lot since '59, starts per capita are a lot lower than '59.
Bob Dobbs | Homepage | 02.18.09 - 9:00 am | #
Exactly - let's see some of that normalization that CR seems obligated to do for the UE numbers - per capita is easiest, or by households (subject to changes in household formation rates).
ova,
"That would be better than zero. Somebody has to knock them dow and carry them off"
I know, but isn't it a little scary that E's plan has allure...
TTFN!
Nostrovia,
Oh Obama,
Wherefore art though Obama. We need to maintain overpriced housing STAT!!
Quit dinkin' around and fix pricing already.....
GWB would have had a program up and failing by now, so step lively man!!
On a side note, I will be heading to the Obama protest/speech/rally today with a sign showing a picture of Bush morphing into Obama with the caption "Out of the frying pan, into the deep fat fryer".
With any luck someone will tase me so's I can get paid Democrat style!!
Full disclosure, I am neither a rightest or leftist...
...that pretty light blue band silhouetted behind the angry downward red & dark blue streaks is sure getting FAT!
Lots of ponies from O'Drama to lenders today ! I like mine Medium rare.
Monster rally ?
Yen doing that thing it likes to do...just sayi
citizen energyecon, I've plotted that before - it just looks like a steeper / more severe decline.
It's just an extra step because it is a 2nd series ...
best to all.
They're skyin' 'em, boss.
Our gov't is always so kind. Let's try and force a broken model's equilibrium point by bailing out specuvestors with the money of the prudent.
YIPEE!
Numbnuts....
Nostrovia,
The Latest from Denninger:
"The Beginning Of The End"
Which gov't agency tracks housing demolishions?
haynes on CNBC is calling BS on the bailout of the irresponsible
You folks just don't get it.
+
Figure it out, just this one time, PLEASE.
bsneath
sebastian? that you?
"The Beginning Of The End"
He's recycling material, that's what he said on Sept 15th. Yawn.
.
who said?
How about a Iraq/afgan veterans housing GI bill. Give all returning vets 50% of the value of a foreclosed house, and give them a 5% mtg for the rest. A way to reward those who put their asses on the line for this stupid war (more true of Iraq than Afganistan) and rudce the excess supply of houses.
haynes "we just taught a whole generation to buy more house than they can afford because they WILL be bailed out.."
haynes on CNBC is calling BS on the bailout of the irresponsible
Citizen Scotto | 02.18.09 - 9:12 am | #
I'd love it if they'd keep Santelli and Haynes, and put the rest of the staff in the gas chamber.
Haynes singing "Tomorrow" from Annie still makes me giggle.
mea culpa, mea culpa, mea maxima culpa.
Markets want their heroin. Junkies don't care if it's crap smack. Just one more fix, Uncle Sam Pusher Man, just one more fix. They'll shoot it telling themselves how good it is, rush will go as fast as it came, they'll puke and be sick again.
I'm not sure what a housing start is, but it seems like the number of starts must go below the demand before housing can stabilize. In that sense, the drop in the number of housing starts isn't 'weak', but rather, an indication that things are getting better.
NateTG | 02.18.09 - 8:58 am | #
In order to stabilize, starts have to equal demand. However, demand will not stabilize until the available amount of housing inventory drops to a reasonable level. That won't be zero, in much the same way as full employment is 4-6%, depending on what eras you've lived through.
On the otherhand, you're entirely correct in that even if things are not getting better, the forces of objective reality have begun to factor into the decisions of home builders bankers, et al.
Eric writes:
anyone short?
............yeah , it's me..........5'6..............
Citizen Scotto writes:
haynes "we just taught a whole generation to buy more house than they can afford because they WILL be bailed out.."
He whines because he has a job because CNBC got bailed out to the tune $310 billion via GE ....whine whine whine
Everything is free here in the land o' plenty. Free homes, free healthcare, free social engineering. You want it, we got it, and it's free.
Wait, Grandpa said there is no free lunch. Nah, that old fart doesn't realize that we are now so SPECIAL!!!
ETF Not Found - WSJ.com
Gold ETF.
President Barack Obama's plan to deal with the U.S. housing crisis will help as many as 9 million families restructure or refinance mortgages to avoid foreclosure, according to a summary released by the administration on Wednesday.
Obama mortgage plan to aid up to 9 mln families
| Reuters
This fool is peeing in the ocean.
Obama's anti-foreclosure program features $75 bln stability initiative
Bush/Obama= Dumb &Dumber
This fool is peeing in the ocean.
surely that's better than peeing in the drinking water well
Anonymous writes:
This fool is peeing in the ocean
And your plan is?????
".....homeowner stability initiative to help keep between 3 million an 4 million "responsible homeowners" in their homes."
....WAIT JUST A MINUTE. I paid off my place but never got a porch. I want a porch. What's in it for people like ME?
Dirk's suggestion about a veterans housing GI bill is excellent. Makes sense. Could be implemented right away: veterans probably are used to less-than-perfect housekeeping. (Anybody seen the World Press Photo for 2008?) Shouldn't cost too much. Helps people out in a practical way. Too bad that it is unlikely to happen.
Rob Dawg writes:
Wiley E. Coyote just made a hole in the bottom of the canyon. Where's that anvil got to?
ACME has an oversupply of anvils. I'm sure three are making their way to the bottom of the canyo
This fool is peeing in the ocean.
Oh, no....
Not another commemorative plate.
.
"$75 billion homeowner stability initiative to help keep between 3 million an 4 million "responsible homeowners" in their homes."
75B/3M = 25K
BAWWAAAAA!
there is only one alternative:
Strip the homes and export to india.We will purchase them.
haynes "we just taught a whole generation to buy more house than they can afford because they WILL be bailed out.."
Citizen Scotto | 02.18.09 - 9:13 am | #
Think so? If I'm not mistaken, the generation to which you refer (and their children) will be the ones paying for this bailout, and as such, might not be learing this lesson as you see it.
....nor learning either.
....WAIT JUST A MINUTE. I paid off my place but never got a porch. I want a porch. What's in it for people like ME?
Black Star Ranch
The satisfaction of giving to charity for the stupid needy. Don't you want to help end the homeless problem? Responsibility is so old fashion.
re: GI Housing bill
not that i particular feel this way, but one of the criticisms that has been advanced is one of class.
Thanks for fighting in the war, now here's a nice house in the Inland Empire for you...
[And your plan is?????
Johnny Mustardseed ]
Free. Market. Capitalism.
LOL!
Johnny Mustardseed
And your plan is?...well were waiting!
9 million homes, $75 billion dollars. Average award; $8,000. Nothingburger. $8000 30yr amortized 5%; $43/mo.
"haynes on CNBC is calling BS on the bailout of the irresponsible"
I assume he's talking about the bankers on wallstreet.....
repost because (kind of) on topic:
Crain's Business reports that downtown Chicago new condo sales were negative last quarter--that is, more units fell out of contract than were sold (sales were -253). Last year, 644 new condos were sold; contrast that with 8,162 in 2005 (peak sales) and 3,724 in 2007. Thousands of units are about to be completed this year, as well.
http://www.chicagorealestatedail...ews.pl? id=33037
send us all 9 million homes.You manufacture homes,we will purchase them
Martin, the Netherlands writes:
Dirk's suggestion about a veterans housing GI bill is excellent. Makes sense
Problem is returning war vets can't find a job. Companies won't hire them, afraid they'll wig out. Saw a vet talking about it last night. 20% of returning vets homeless. This is Amerika post WW II, we treat our returning vets like shit, discard them to the trash heap, do our best to cheat them out of benefits, education payments, etc. It's the Amerikan way.
Keep in mind that this is just one prong Obama's foreclosure relief plan.
He's supposed to announce that a major populist push for lien stripping, which will be a much bigger deal.
Black Star Ranch writes:
".....homeowner stability initiative to help keep between 3 million an 4 million "responsible homeowners" in their homes."
....WAIT JUST A MINUTE. I paid off my place but never got a porch. I want a porch. What's in it for people like ME?
Maybe you get to see your country the UNITED STATES OF AMERICA stay together....Pain for all..yes but a future maybe. I don't think it will save us,but Obama needs to try something
[I'd love it if they'd keep Santelli and Haynes, and put the rest of the staff in the...
Eric ]
I have always liked D Faber. His house of cards special was pretty good.
"send us all 9 million homes.You manufacture homes,we will purchase them"
limda,
Show me 2 Trillion
Fixed Crain's link:
Downtown condo sales show net loss in 4Q - Chicago Real Estate Daily
"Don't you want to help end the homeless problem?"
I am helping the "homeless", thank you. I let my shiftless middle brother come live with us, and then there's Rudolpho (the foreman), Oracio (the cowboy) & Felipe (the resident drinker) some days.
REBear writes:
"send us all 9 million homes.You manufacture homes,we will purchase them"
limda,
Show me 2 Trillion
REBear | 02.18.09 - 9:29 am |
We will pay in rupees
Shouldn't cost too much. Helps people out in a practical way. Too bad that it is unlikely to happen.
Martin, the Netherlands | 02.18.09 - 9:22 am | #
There'a also the issue that vets may not want home on inner city Detroit, which is nowhere near as nice as inner city Amsterdam, though the number of crackhouses is probably greater than the number of coffee houses in Amsterdam. Having been to the Netherlands a number of time, I've often wished I could live there. I doubt you'd feel that way about many of the forclosures here in the US of A.
Beyond that, forclosed homes might not be convenient to a vets new job once s/he returns home. There are a lot of issues here in the US of A that you wouldn't consider in Europe, so it's difficult to make comparisons. Smoke a doobie for me-
....nor learning either.
Black Star Ranch | 02.18.09 - 9:25 am | #
Haloscan need a grammar checker, as well as a stupidity checker for me
@Hoopajoops - If you're around, I saw you (or someone) asked what would happen to DJIA if BAC, C and GM just vanished. The answer: The index would lose about 82 points.
Honest. Their combined weight of DJIA is about 1%.
Great news.
Obama is keeping that election campaign promise to pay off my mortgage. Now, all he has to do is send me a check for my utilities and food and I'll definitely vote for him next time.
So far, this guys working out great !
The Netherlands rule.. and Amsterdam is just awesome..
LOL....just trying to help, xxxxx
I am helping the "homeless", thank you.
Hey, where are you at? I'm trying to freeload my way across the U.S. and I still need couches in 42 States.
.
mod fee $1000 x 3mil borrowers = $3billion direct to servicers
success fee $1000 per year x 3years = $3000 x 3million borrowers = $9billion to servicers.
$12b + $3b = $15b out of $75 billion to servicers ... that's 20%
.....[eg] good one, Broward.....Alaska
Is BAC about break the shortest time on DOW record?
$15b out of $75 billion to servicers ... that's 20%
And the largest servicers are the money center banks, who could give a rat's ass about the losses to the underlying securitized loans.
....[eg] good one, Broward.....Alaska
Dang, already got one there.
.
I'm in favor of helping exactly one kind of borrower...
The group of people who can't afford their current mortgage because it's some exotic arm... but who could afford their mortgage if it were changed over to a 30-year fixed with no change in principal.
The problem is I have no idea how many people are in that group
oops, $3b + $9b is $12b out of $75 16%
test test test
yves
recognising losses and recapitalising the financial system are vital, even if, as Mr Koo argues, the unwillingness to borrow was even more important. The Japanese lived with zombie banks for nearly a decade. The explanation was a political stand-off: public hostility to bankers rendered it impossible to inject government money on a large scale, and the power of bankers made it impossible to nationalise insolvent institutions.
At least at the current rate of decline I project that home starts will hit bottom very quickly...it has to as zero is getting very close.
DD
@xxxxx: Not all parts of Amsterdam are nice...
@LarryKudlow-Assclown: I'm very flattered!
What were the drivers of reversals in the previous downturns?
I am waiting for DailyBail. I know he will like the Purple House Award.
New Thread: Capacity Utilization and Industrial Production Cliff Diving ( 0 comments ...You could be FIRST! )
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It may be necessary to temporarily nationalize some banks in order to facilitate a swift and orderly restructuring, former Fed chairman Alan Greenspan told the Financial Times. I understand that once in a hundred years this is what you do.
This 'confession' from one of the main guys that fucked things up.
The problem is I have no idea how many people are in that group
LarryKudlow-Assclown | 02.18.09 - 9:35 am
I am in that group, so you can add 1. A fixed 5% would cut my monthly payments by @ 800 bucks...Which is what I am burning out of my savings account every month to keep up right now...
"Problem is returning war vets can't find a job."
Empires of the past learned this lesson the hard way: do not EVER bring the army home.
Maybe you get to see your country the UNITED STATES OF AMERICA stay together
Big deal. The "U.S.A." is mostly good for sentimental value these days. If it can't offer people adequate health care, a decent standard of living, and the right to assemble without being herded into "free speech zones," maybe it's time to let it break up.
Looks like that Dow open on a slightly higher 75-- handle has gone all floppy.
Honestly, sometimes the charts get over-dramatized with the scaling, like when a seemingly massive volume on open, like 10m trades gets re-scaled by the 60m in the last 5 mins, eg opex week(s).
Right, off to work before I get snowbound.
C
Born and bred American DOPES don't know whether to stop building more houses or to live in wigwams. The true sign of a born and bred American Dope is dropping umbrellas on anvils, while the Zombie Japanese bankers take over coffee houses in Tehachapi ... blah, blah ... rant, rant ... ramble ....
You will know the end times are near when you start to actually miss Jas's posts. (Fortunately, not quite to that point--yet.)
"If it can't offer people adequate....."
The "Country" is not supposed to offer us SH** - all they (the government) has to do is stay the hell out of the way - no social engineering - pretty simple actually - but then give a bunch of egos nothing to do, and they'll frig that up too. It's up to us TO DO.
I wouldn't call this a very weak report. To me, this is exactly what we need right now. The fewer homes will build now, the faster we can put this bubble behind us.
BTW, the Phoenix bubble is now officially over. Homes are now selling for less than pre-bubble levels (in real dollars).
Thanks for fighting in the war, now here's a nice house in the Inland Empire for you...
Basel Too "
What about those houses in Chula Vista from Jim the Realtor?
If anything, the vets should get the high-end stuff.
If the taxpayers are funding it, then these are the men and women who should be given the best.
"In order to stabilize, starts have to equal demand. However, demand will not stabilize until the available amount of housing inventory drops to a reasonable level. That won't be zero, in much the same way as full employment is 4-6%, depending on what eras you've lived through."
In order to stabilize, starts have to be far below demand for several, several years as a vast majority of the oversupply needs to be absorbed.
@xxxxx: Not all parts of Amsterdam are nice...
Martin, the Netherlands | 02.18.09 - 9:37 am | #
Which ones? Red light, blue light?
Let's give the vets the extra cars, too, and since we have the printing press why not just print an extra million dollars for each one. When we have extra crops, let's give them to them as well.
"Let's give the vets the extra cars, too"
Seriously, if we're giving away billions to bankers, why quibble about giving vets the high-end foreclosures.
It knocks out most of the speculators, targets a much smaller and politically acceptable group, and eliminates the need for bulldozing in Greenwich.
Plus, the folks who voted for Bush get to live next door to the men and women who got stuck with all the risks.
Wasn't there a CR housing starts bottom calling contest a while back?
How low can we go?
"Seriously, if we're giving away billions to bankers, why quibble about giving vets the high-end foreclosures."
Sure, despite what he may think, the vet who gets it won't be able to afford the upkeep and the utilities. And the vet who doesn't get it will be angry, b/c he got a house in the ghetto. Doesn't really sound like a fair plan to me. And when plans aren't fair they get corrupt very fast.
Beware! Those thinking the DOW is at the November lows need to consider the S&P. It is still about 30 pts. above the Nov. lows. Even if the Nov. lows hold, there are about 30 S&P pts to go, which translates into 24-300 DOW pts, which will definitley mark a new DOW low.