Housing Starts Rise 37% YoY Crushing Expectations

[Jordan]

Starts rose 24.7% in the Midwest, 21.4% in the Northeast, 18.7% in the West and 3.8% in the South. By structure size, starts for single-family homes rose 8.1%, and increased 20.3% in buildings with at least two units.

While starts in December were up 37% from a year earlier, rates remain far below a bubble peak of almost 2.3 million in 2006.

http://articles.marketwatch.com/2013...es-annual-rate

How misguided can housing bears be?

[torchbearer]

history repeats and the fed even admitted they were intending to reinflate the housing market.
i guess some people never learn. Inflation doesn't effect prices evenly, money flows to different areas in different amounts.
want to know where all the new credit is going?

[Acala]

One of these days, all the Fed money sitting in bank reserves and invested by banks in equities is going to come pouring into the economy. You know what it will look like in the initial stages before it drives general price levels through the roof? ^this

[Seraphim]

Are these new builds of the atrocious quality seen in many of the new builds between 2004-2009?

[cbc58]

Jordan - go buy housing... we'll pick it up for a 30% discount later. They want everyone to believe it's a great time to buy and many are falling for their trap hook, line and sinker.

[Seraphim]

I agree very much with Kyle Bass that US housing as a general PRICE POINT has stabilized and will go up from here in the long term. US RE is a bargain and value play INTERNATIONALLY.

This thread, however, is not a play on current price point but a indication of current building which indicates the current demand for long term demand (if only only by the current owner).

A lot of new starts signals long term valuations are favorable.

Any debts incurred on these mortgages are valued in USD and the value of the USD is bleak. Remember, the CRASH is home prices has ALREADY occured. The sudden and massive revaluation of the asset price (in this case residential RE) has occured already. Housing has crashed. The CRASH is DONE (in housing).

The next crash is a larger event. It is a debt/currency crash.

In this next crash, which is more of a fluid and ongoing event...real assets will do just fine.

US RE has already crashed and is PRIME in relation to **MOST** of the world.

The largest and most destructive swing/crash in price is DONE.

Hi, I'm Canadian and on the international market, I am BULLISH on well chosen US real estate.

I'm more bullish on gold/silver - but US RE is a gem.

Jordan - go buy housing... we'll pick it up for a 30% discount later. They want everyone to believe it's a great time to buy and many are falling for their trap hook, line and sinker.

[cbc58]

couldn't disagree more - here's why: the market has never really crashed because it has been supported by law changes, accounting trickery and free money. household expenses are going up, not down. a 1/2% rise in interest rates cuts about $4500 off how much someone can borrow on an average house loan. there are millions of homes being held off the market artificially. boomers are downsizing. just to name a few. go buy real estate if you have money and a job ... only problem is most people don't. in general -- it's downhill for years regardless of what the stats and Bass say.

[enoch150]

I was visiting my parent's in a very rural area of Virginia recently and noticed a ton of new logging projects going on in the area. I figured that was a pretty good indication housing starts were picking up.

[Jordan]

Jordan - go buy housing... we'll pick it up for a 30% discount later. They want everyone to believe it's a great time to buy and many are falling for their trap hook, line and sinker.

No way you'll get it cheaper than you can right now. That's pure delusion and time will confirm that.

[Jordan]

Jordan - go buy housing... we'll pick it up for a 30% discount later. They want everyone to believe it's a great time to buy and many are falling for their trap hook, line and sinker.

No way you'll get it cheaper than you can right now. That's pure delusion and time will confirm that.

[Zippyjuan]

Jordan - go buy housing... we'll pick it up for a 30% discount later. They want everyone to believe it's a great time to buy and many are falling for their trap hook, line and sinker.

I had a friend suggest I do that with my property. It is still not down to what I paid for it originally (1999). Meanwhile I have it all paid off now. If I had listened to him I would either be a renter still or would have purchased it at a higher price and owed more money and faced higher property taxes today.

Let's say you are paying $1000 a month in rent today and decide to wait two years for prices to come down more. That is $24,000 more you have paid into rent and gotten nothing for instead of using that to pay down the principle on a place today. And that assumes that prices are the same or lower in the future- if they continue to rise (as they are in most markets now) you will need more money due to higher prices of homes. As low as interest rates are today it not likely the borrowing costs will be any cheaper (and could very well be higher) and you will be two more years away from having it paid off. Those two more years cost you on the other end as well- two more years of mortgage payments and interest instead of being mortgage free.

In my opinion, the best time to buy a house is anytime you can afford it. You cannot predict what prices will do in the future.

[Henry Rogue]

In my opinion, the best time to buy a house is anytime you can afford it. You cannot predict what prices will do in the future.

I think this is sound advice, buy a house when you can afford it and I might add if you need it and or want it. I don't look at a house as an investment any more than a car is an investment. I don't think i will ever get out of my house what I put into it (principal plus interest, taxes and maintenance), but performs the purpose that I had intended for it. I know some people will make a profit from real estate investments, but certainly not all. Real estate isn't the sure thing that the keynesians will have you believe, 2008 proved that, but that doesn't mean you should never buy.

[oyarde]

I think this is sound advice, buy a house when you can afford it and I might add if you need it and or want it. I don't look at a house as an investment any more than a car is an investment. I don't think i will ever get out of my house what I put into it (principal plus interest, taxes and maintenance), but performs the purpose that I had intended for it. I know some people will make a profit from real estate investments, but certainly not all. Real estate isn't the sure thing that the keynesians will have you believe, 2008 proved that, but that doesn't mean you should never buy.

I agree with Henry & Zip , as long as we are talking about a property you plan to reside at, basically , forever .Not "investment " property .

[Zippyjuan]

I think this is sound advice, buy a house when you can afford it and I might add if you need it and or want it. I don't look at a house as an investment any more than a car is an investment. I don't think i will ever get out of my house what I put into it (principal plus interest, taxes and maintenance), but performs the purpose that I had intended for it. I know some people will make a profit from real estate investments, but certainly not all. Real estate isn't the sure thing that the keynesians will have you believe, 2008 proved that, but that doesn't mean you should never buy.

I see mine as a part of my retirement plan. Get your expenses as low as you can. Paying off the mortgage means I need less money to live on every month. Rent will never get that for you (and rents will likely continue to rise in the future).

[Michigan11]

Well I'm in Florida, and am not seeing much if any construction in my areas of travels. The midwest numbers seems surprising, where are these going on at I wonder. If these housing starts are increasing, normally you and I would get a general sense of it first hand, by sight or heresay locally, wherever we live such as in the past. Today I see all these numbers and just wonder lol

[ronpaulfollower999]

Well I'm in Florida, and am not seeing much if any construction in my areas of travels. The midwest numbers seems surprising, where are these going on at I wonder. If these housing starts are increasing, normally you and I would get a general sense of it first hand, by sight or heresay locally, wherever we live such as in the past. Today I see all these numbers and just wonder lol

Same. No construction around me, but houses are starting to sell which is good.

[NoOneButPaul]

http://articles.marketwatch.com/2013...es-annual-rate

How misguided can housing bears be?

I keep trying to tell you as someone who works in housing that almost all of this is being driven by the HUD!

Without the HUD housing would be in the toliet.
Without the Gov't funding the HUD it wouldn't exist.
Without perpetual printing and debt that destroys your currency the Gov't couldn't fund the HUD.

What part of this is hard to get?

This entire economy is built a top a failing currency.


But please... march back into this market and prove us all wrong. I'll keep stacking gold and silver and let's see who wins out...

[oyarde]

I keep trying to tell you as someone who works in housing that almost all of this is being driven by the HUD!

Without the HUD housing would be in the toliet.
Without the Gov't funding the HUD it wouldn't exist.
Without perpetual printing and debt that destroys your currency the Gov't couldn't fund the HUD.

What part of this is hard to get?

This entire economy is built a top a failing currency.


But please... march back into this market and prove us all wrong. I'll keep stacking gold and silver and let's see who wins out...

HUD math is pretty much the math I have seen....

[oyarde]

I keep trying to tell you as someone who works in housing that almost all of this is being driven by the HUD!

Without the HUD housing would be in the toliet.
Without the Gov't funding the HUD it wouldn't exist.
Without perpetual printing and debt that destroys your currency the Gov't couldn't fund the HUD.

What part of this is hard to get?

This entire economy is built a top a failing currency.


But please... march back into this market and prove us all wrong. I'll keep stacking gold and silver and let's see who wins out...

Silver, $31.91 , Gold, $1689.30. Yeah, I will have a beer now

[Tpoints]

I keep trying to tell you as someone who works in housing that almost all of this is being driven by the HUD!

Without the HUD housing would be in the toliet.
Without the Gov't funding the HUD it wouldn't exist.
Without perpetual printing and debt that destroys your currency the Gov't couldn't fund the HUD.

What part of this is hard to get?

Ok, fair enough, but do you think those things are going away anytime soon? We may agree they should, but will they?

[newbitech]

Ok, fair enough, but do you think those things are going away anytime soon? We may agree they should, but will they?

just real quick, i just posted a quick look at the fed effective rates and the fed back mortgage rates (fannie, freddie, FHA etc -> HUD umbrella).

I think it's plain to see that there is nothing that HUD can do to prevent the housing market from recycling. 1993-2005 was extraordinary in terms of propping up and handing out.

It didn't work! Oh it was nice for a stretch there from 2002-2007, or 5 years. But look now, rates at all time lows. Fed rates at basically 0. And for 4 years of this what do we see? finally an uptick in construction. Yeah, I don't think that's gonna last, and I wouldn't be surprised one bit if the numbers are more than a little fudged.

BUT, lets say we do get another run. How far is it gonna go? AND, when the market recycles in a couple of years, like it always does, then what?

Rates to 0%? They gonna pay people to live in these homes? Aren't they already doing that in some cases? YET, the best we get for recovery is a return to HISTORICAL LOWS? Come on!

HUD may not be going away anytime soon, and that is tragic. But all the propping and printing in the world didn't stop the last collapse. No reason to believe it will stop the next one in probably less than 2 years.

[Tpoints]

just real quick, i just posted a quick look at the fed effective rates and the fed back mortgage rates (fannie, freddie, FHA etc -> HUD umbrella).

I think it's plain to see that there is nothing that HUD can do to prevent the housing market from recycling. 1993-2005 was extraordinary in terms of propping up and handing out.

Not even subsidizing renters can prop of the market?

[newbitech]

Not even subsidizing renters can prop of the market?

their are a couple of things that will turn the market around.

1.) a shift from debt base purchasing of real estate to labor/cash based purchasing.
2.) population growth rate increase, either immigration or higher rates of birth
3.) land value appreciation IE, some heretofore undiscovered resource in the sand/rock/gravel/soil the house is built on.
4.) real economic growth

[idiom]

Well, as long as you have are purchasing something with clear title right?

And of course the mortgage is going to be held at the originating place and not shipped off before the ink is dry...

[devil21]

Why such disparities between regions? I live in the 3% south and there's definitely few starts (or sales, really) going on here.

[oyarde]

Any of young folks, I offer this, make sure you have a plan in place to keep up your payments if you lose a job that will be difficult to replace .

[ItsTime]

Any of young folks, I offer this, make sure you have a plan in place to keep up your payments if you lose a job that will be difficult to replace .

The plan should be don't buy until you have at least a year of expenses for a back up plan...

[talkingpointes]

Rental properties are still dirt cheap and without the hassle of taxes or another bubble. Phoenix is already on the rollercoaster again. I do flooring and have been busy the way I was back in the end of 05- into 06. Prices are up last year alone in some areas 36%. Yay..

[torchbearer]

my rent is $450 and i don't live in a dump.
hard to beat that without living in a ghetto.

[KrokHead]

my rent is $450 and i don't live in a dump.
hard to beat that without living in a ghetto.

In NY it often costs over 1100 for 1 BR to even live in the ghetto because the rents are artificially inflated by section 8. The government really hates social mobility.