Another blow to the overall Housing Market. KB Homes, the nation's largest Home Builder announced that they had a 68% cancellation rate for the fourth quarter of 2022. Their previous quarter's cancellation rates were not as bad, but still dismal for the market. KB Homes is not the only Home Builder that is experiencing this issue, however they seem to be the one that is most affected by this down turn. In the end, this phenomenon clearly tells the Housing Market that it is in for a bumpy ride in 2023, as mortgage rates are predicted to remain above 6% as the FED has not given any indication that they will begin to reduce rates going forward. The Housing Correction is full on and when the backlog of Foreclosures come along, we will move into the Crash phase.

There is some chatter out there regarding the likely hood that the Federal Reserve will reduce interest rates in 2023. At this point I think The FED has made themselves clear that they do not intend or foresee any rate reduction in 2023. In fact they state just the opposite: rates could rise a few more times this year. All 19 Executives of the Federal Reserve stated that they do not see rate reductions happening in 2023. Whoever is promoting the rate reduction concept is simply talking up their own wishful thinking narrative. Additionally, we see more Sellers offering concessions to Buyers in order to secure the deal. Some of these concessions involve Mortgage Rate Buy Downs, which are gaining in popularity. A couple of years ago it was the buyers who were conceding, waiving inspections and engaging in bidding wars. Funny how things change.

The new year of 2023 kicks off with the US Housing Market "frozen" and at a virtual standstill. With current and future sales activity down and to record lows, the Housing Market is eerily similar to what occurred just before the 2008 Housing Crash. The Housing Bubble has burst and the Housing Correction is underway. Another growing concern is the exposure with recent (2022 originated) FHA mortgages, many of which are already in default, or actually underwater.

In this video we discuss an interesting list that suggests the Economic Meltdown is already underway and it appears that the Housing Market is leading the way with the 1st 5 "reasons/issues" etc. It should come as no surprise as the Housing Market has taken a hit with respect to sales activity and price/value declines. The value declines are clear for everyone to see via the recent posting of the Case-Shiller US Home Price Index.

Last Long Video before Christmas Break. The Housing Market slows to a crawl and is now officially dead. Existing Home Sales down big time as well as New Home Sales. Mortgage Companies slowing as well and some are already in or headed to Bankruptcy. Seems a little like 2008 all over again.

Even though the Housing Market is starting to see a notable decline in Home values across the board, lack of Housing Inventory issues still persist. Lennar Homes announces that they want to sell 5000 of their homes to larger Investor groups. Additionally Gen X and Baby Boomers are not really in the market to sell their homes for a number of reasons. Couple this with the Builder perspective and we will have a tough time generating cheaper homes for the average buyer. An obvious solution to this issue is to focus of the Foreclosure niche as a source of readily available properties.

We knew something like this was likely. In fact, it was probable but it did not fit into the Housing Narrative at the time. It is clear that Home Buyers who recently purchased homes in 2022 are now experiencing "Equity Risk" based on where the Housing Market is headed and many are already defaulting on their monthly mortgage payments. This should come as no surprise, especially when looking at the amount of defaults associated with FHA/VA loans, since the borrower qualifications for those mortgages are more flexible than other loan programs. This is the flip side of stretching your purchasing ability during peak markets.

It is clear to see that the average person is now getting inundated with all sorts of Housing related articles. Most of these are now referring to the changes in the Housing Market, which is currently experiencing a Correction, with a Crash most likely to follow. Even the Chairman of the Federal Reserve, Jerome Powell, stands behind is statement made back in June regarding the fact that he needs the Housing Market to "reset" in order to make Homes affordable for the majority of people, not just the wealthy or the Investor Market.

Are you a Housing Bull or a Housing Bear ? Do you think the Housing Market will continue to slide into Crash territory or are we simply experiencing a short term phenomenon ? Another Wall Street financial firm gives their opinion as to what they believe will occur in the near future. It is very conservative to say the least.