Click for ginormous chart:




Source: Bank Of The Internet

Category: Digital Media, Real Estate

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

18 Responses to “Will America Ever Recover From The Housing Crisis”

  1. James Cameron says:

    Perhaps I’m color challenged, but I’m having a little difficulty squaring the housing “graph” with the colors in the legend. AND FYI to whoever created the graph: use a pdf rather than a jpeg (if the sources aren’t individually clickable) so the sources can at least be copied . . . and checked.

  2. Winston Munn says:

    If anyone needs help understanding the concept of misallocation of resources and its consequences, point them to this chart and to this recession.

  3. willid3 says:

    the housing market might recover about the same time wages do. which currently are on a 30 year down ward slope. until wages do, housing wont either. as folks get used to have less and less income every year, they will run away from any thing that has a long term commitment (that 30 year mortgage fore example)

  4. wally says:

    Sure; we’re recovering right now… ever since BR’s 5 part bottom call.

  5. hawaiianwaverider says:

    another factor is $1trillion+ student debt (plus limited job market) that the younger generation has and is not forgiveable by bankruptcy. Even though that age bracket is a smaller size of the buying pool, they are a component that will not be there as they were in previous cycles.

    OT but relevant, lord help us if the whining increases about “forgiving” some of that student debt. It would be tragic to teach a whole generation that you are not responsible for debts you incurred.

  6. cognos says:

    Hmm… seems like we’ve “recovered” ALOT.

    Lots of 5-20x trades in stock market (and HY and MBS credit).

    Lots of new jobs (maybe not as many as we’d like).

    Zero to no inflation remains the main problem… and this is demographic, along with overly cautious monetary and fiscal policy.

    But by the time you feel “confident” in the recovery… it will be full-on bubble boom. Isn’t it ALWAYS? When did we realized the early 90s downturn was “recovered”…? It wasn’t 1994… was it 1996? Or was Grantham still a naysayer? (By my recollection he was bearish all through 96, 97, 98, 99, etc… as were many others. Ha!)

  7. dsawy says:

    This bit of chart-porn says nothing about the demographic wave of the Boomers moving into their senior years and down-sizing their housing requirements. Not just the size of their homes (as their children move out), but also the tendency of older people to get rid of vacation homes as they become less mobile in their senior years.

    Couple that with the aforementioned (by @hawaiianwaverider) student debt crimping the ability of young people to take on debt for tangible and substantial property (both cars and houses) and we will likely have a moribund housing demand for quite some time…

  8. louis says:

    It will recover for 4 weeks preceding the election. And then it will continue it’s transformation.

  9. wally says:

    “It would be tragic to teach a whole generation that you are not responsible for debts you incurred.”

    Yes, people get morally uptight. On the other hand, the GI bill was an immense giveaway that dwarfs student loans and paid off by helping make the US into – by far – the strongest economic power in the world. Making investments like that in your future is no giveaway. It pays handsomely.

  10. VennData says:

    “…How Banks Bought The Tea Party…”

    Cancel my subscription to this blog. Are you saying banks give money to Republicans?! Are you insinuating that? Are you out of your mind? Don’t you realize, Barrack Ritholtz, that OBAMA is the one that bailed out the banks!

    … gave them a deal, a sweet, free ride, that kept their managers intact, their bond holders whole and even allowed the shareholders to hang on and cash out? Don’t you realize that? …that money that could have been made an equity investment into every home with a current mortgage (Hard-working, God-fearing, meat-eating Republicans…) and that they all LOVE Obama now, bowing down with their elite Wall Street Hedge Fund and Private Equity buddies? Don’t you know the truth about who bailed out the bankers?! It was the liberals!!! I swear it was… The Limousine Liberals! I promise…. please… please it was the liberals…

  11. Shiller’s data is based on only 10-20 cities and compares to “a year ago” … not last month, thus those subscribing to his methodology have missed the bottom.

    Using April 2012 data, the median national New Home Price bottomed in Oct/2010, has since risen $30,000 and is only 1% below the long-term Price/family-income trend line. The median nat’l Existing Home Price bottomed in Jan/2012, has since risen $24,000 and is 10% below trend. Sales volume for both is also far above the recent lows.

    Realty Bubble Monitor:

  12. huxrules says:

    Damn you Austin with your “what’s a 2008″ real estate market. I’d like to hear more about places that didn’t get gutted and why.

  13. wisedup says:

    relax, fresh from his successful stint in Wall Street Mitt Romney will enrich the investors by selling off the assets of America at 2 cents in the dollar to the Chinese. The influx of Chinese owners will finally eliminate the housing crisis.

  14. Jim67545 says:

    @VennData: are you serious? My recollection is that the bank bailout occurred in the summer and fall prior to Obama’s presidency. Although we hear that everything is Obama’s fault somehow… dropped something on my foot yesterday. Darn that Obama.

    Housing: Oversupply meets weak demand. Oversupply due to demographics, a decade of overbuilding, changing economic dynamics (which make some areas less in demand than before), changing taste (smaller homes, shorter travel), etc. Weak demand for all the reasons mentioned above plus widespread damaged credit meeting restrictive lending standards, depleted savings (unemployment), rising general cost of living (despite low inflation) meeting stagnant real wage increases. The distress in Florida and Las Vegas, both retirement related, also signals at best a freeze-up in retirement related migration and at worse a symptom of retirees being more poorly prepared for retirement. This may have to do with the disappearance of defined benefit pension plans, poor saving in 401(k)s, unemployment occurring at end of careers, etc.

    LOTS of forces at play. Net net, slooooow absorption. In 2008, when asked, I said it would take 5 years to work our way through this but now I think it will take another 5, barring any new drop in the interim.

  15. MayorQuimby says:

    Housing will be just fine when “they” let prices correct to affordable levels which with today’s jobs instability and cost of living is probably about 2x household income.

  16. agrund says:

    At May 23, 2012 8:35 am

    @VennData: are you serious?..

    No, he’s not. Sheesh.

    Also – from the graphic.. “reign in your financial” Double sheesh.