CEO Warning: The Housing Market Faces The ‘Perfect Storm’

by | Mar 26, 2019 | Headline News | 18 comments

Do you LOVE America?


    Recently, CNBC interviewed Glenn Kelman, the CEO of Redfin, on the current state of the housing market. Kelman said that housing prices, interest rates, and taxes are whipping up a “perfect storm” on the coasts and elsewhere.

    Student debt is already weighing heavily on the housing market, and interest rates poised to hit 6% could throttle the already precarious situation the economy is in now.  To be sure, the falling 30-year mortgage rate could reverse and hit 6% in the second half of next year. With record numbers of Americans in a record amount of debt, the slightest increase in interest rates could push some over the edge.  But that’s only one concern about the housing market.

    There is no better barometer on the health of the United States’ economy than housing, according to Market Watch. It’s an industry that encompasses a myriad of vital sectors; including banking, manufacturing, commodities, international trade, transportation, and, of course, consumer spending. So it’s not surprising the Federal Reserve closely monitors housing trends in the course of setting monetary policy. It’s simply not possible to have a solid economic foundation without a robust housing market, and last year, the housing market was anything but robust.

    The Fed’s hesitancy in raising interest rates further last week was due to volatility and instability in the housing market. This weakness is evidenced in the government’s own housing numbers.

    Early this month, the government reported that new home sales dropped 6.9% in January to a 607,000 annual rate, which happens to be 4.1% below its year ago level. Not a great start to 2019. Sales crept up a disappointing 2.2% all of last year.

    Existing home sales for February, on the other hand, rebounded with an 11.8% jump over January. It was certainly better than consensus expectations, which was in the range of a 5% increase. (Yet even with this bounce, the pace is still 1.8% off the same month last year.)-Market Watch

    There are several factors that play into the “perfect storm” for the housing market.  One of those is the overall age of the population. Currently, baby boomers are retiring at a rate of 10,000 a day, which means looking to the millennial generation as the next wave of demand for homeownership. But many in this cohort are incapable of making such a financial commitment because they are burdened with a record $1.6 trillion in college debt. And “serious delinquencies” (those at least 90 days overdue or in default) of student debt topped a record $166 billion in the final quarter of 2018.

    Lenders have also been more carefully assessing who the lend money to. With household debt reaching an all-time high of $13.5 trillion and interest rates rising the last three years, banks have also turned more cautious about granting credit to households, according to the Federal Reserve’s Senior Loan Officer Survey on Banking.

    If the market is weakening as the Fed’s numbers and plans to back off in interest rate hikes are showing, then many will delay home ownership until there is more confidence in the overall economy.  So don’t look for the housing market to improve dramatically this year.



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      1. AGAIN.

        • F***.

          Better get out or Ima end up homeless when I’m 75.

      2. Pfft, are you kidding? Let me hope the housing market improves so that houses continue to be ridiculously over priced, and I have to die in a crappy little apartment. Go Go housing market, and please keep telling them that they own their homes.

      3. “You know very well, and the stupid Americans know equally well, that we control their government, irrespective of who sits in the White House. You see, I know it and you know it that no American president can be in a position to challenge us even if we do the unthinkable. What can they (Americans) do to us? We control congress, we control the media, we control show biz, and we control everything in America. In America you can criticize God, but you can’t criticize Israel…”
        Israeli spokeswoman, Tzipora Menache

        • Yes we now have the first sell out Z-I-o-nist President.

          Never forget the 5 Dancing Mossad Agents on 9-11 that were sent over from the land of squatters to film the airplanes crashing into the twin towers. And they were welcomed back home in squatter land as heros.

          Know thy real enemy of America who hates us. Jealousy.

        • “You see this napkin? In 24 hours we could have the signatures of 70 senators on this napkin.”

          Steven Rosen, AIPAC

        • In America you can criticize God, but you can’t criticize Israel…”

          Sure you can….Louis Farrakhan does it all the time.

        • I have never liked not a single one of “them”, just make me sick to my stomach, the entire bunch of them.

        • But even to repeat what Menache says, even as an Israeli spokesperson,quoted word for word,will not keep you from the charge of ANTISEMITISM!!! You are not of the HOLY BLOOD, you are not one of Gods little puppies, You,Genius, are probably a White Guy filled with hateful thoughts of the White Race surviveing what the Holy Ones have planned for us.

      4. i will say it again……since 2000, the last year for a “normal” housing market, we make LESS MONEY(inflation adjusted). so how do we justify paying DOUBLE, and sometimes TRIPLE for our homes, when we are making less money? too-low interest rates, that’s how…..and SOMEday, we will have to return to normal rates, and pay savers a decent amount of money to rent THEIR money to the banks…….but we WILL have a collapse, and default before that can happen. what CAN’T be paid back, WON’T be paid back……hold onta’ yer BUTTS!

      5. Investment bankers have a short memory.
        Lehman Brothers September 2008.
        Rinse , spit and collapse.

        • but they don’t care, the taxpayers took it up the stinking ass yet again…this damn country so deserves to crash and burn!!

      6. Own your own home in a low property tax state. Or be a pawn in banksters eyes.

      7. California is collapsing. Not a peep on TV, mainstream media or from the realtors. I know several realtors that have left the profession as nobody can afford to buy houses. 25% of all homes for sale are pre-forclosure in some areas of Los Angeles and Bay Area. Here comes the sh@tstorm…
        No more property tax for the greedy libs to waste on welfare programs.

      8. I don’t know about you mainland guys but locally I see a lot more multi generational housing. I see a lot of major house additions.
        It is common to see 6-10 cars parked in someones yard.
        I provided space on my property and helped her and her
        husband build a house there. Many of my neighbors have
        done the same for their kids, or elderly parents.
        This used to be common in America.

        • I provided space on my property and helped my daughter and her
          husband build a house there.

      9. Oh, here we go. The “perfect damn storm” narrative all over again. How trite and stereotypical and BORING can you get?

      10. No problem with housing here in Santa Rosa County Florida.Woodlands are being destroyed at a fast pace to make room for big fancy houses that the people from all the s–thole states are buying.The roads are over crowded so are the fast food joints,Doctors,and Hospitals.The place is becoming what I call,Miami/Dade North,and that aint good.Soon the water shortages will begin during the hot summers and then it will be sink hole time.The County bigshots are calling it progress I call it BS.

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