In a harrowing turn, new home prices have plummeted by a staggering 18%, marking the most significant annual decline on record, surpassing even the depths of the 2008 financial crisis. The grim reality intensifies as builders face a crisis, with mortgage demand hitting its lowest since 1994, and housing defaults soaring to levels not seen since 2013. The average selling price is down almost $90,000 from last year, raising a critical question: How can this precarious situation end well? The housing market is in crisis mode, and caution is warranted.
Last year at this time, the average new home was selling for a record $496,800.
Now, the average new home is selling for $409,300.
As higher rates are here to stay, home builders are likely in for a rough 2024.
Follow us @KobeissiLetter for real time analysis as this develops.
— The Kobeissi Letter (@KobeissiLetter) November 27, 2023
CAUTION: Housing defaults have just reached the highest levels since 2013
This is not looking good pic.twitter.com/hftYQEtRQi
— Game of Trades (@GameofTrades_) November 27, 2023
Never say we didn't warn you pic.twitter.com/czFNvX48zr
— Darth Powell 🦈🇺🇲🇺🇦🇵🇱🇫🇮 (@GRomePow) November 27, 2023
Last week's post:t.co/JfUn2FZdJA
— Genevieve Roch-Decter, CFA (@GRDecter) November 27, 2023
Who went Black Friday shopping?
US personal interest expenses (Aka non-mortgage interest as a % of disposable income) has exploded over the last 2yrs – now it’s highest level since 2009
This trend doesn’t appear to be changing anytime soon
Rather it’ll likely get worse pic.twitter.com/RRwWdTauhA
— Cejay Kim (@cejaykim) November 27, 2023
Real estate prices can actually fall? Hmmm that's odd. I think @1CoastalJournal might be onto something here. 😉😊 #realestate #housing t.co/g4F32Flks6
— Kenny Capital (@KennyCap_Phd) November 27, 2023