Inquiring minds have been asking, where do Real Homes of Genius go when they get their wings? Now that we know that many people that are losing their homes are not the poor family in a $150,000 home struggling to make ends meet, but a would be speculator who is now underwater, we understand that somewhere along the line someone is going to pay for this bubble. The question really is where in the world does the inflated housing buck stop? Report after report from credible sources (unlike some lowly blogger) are now openly discussing nationwide price drops of 25 to 30 percent. The mainstream media is now running with this housing crash phenomenon but why are they still painting with the sub-prime brush? This is much larger than sub-prime and until we start hearing, “every home in virtually every area needs to be prepared for depreciation” we know that we still have a long way to go down.

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Driving around this weekend, I was listening to a local real estate radio show that I’m sure many of you have heard. One of the calls again demonstrates that we are nowhere near the bottom of this housing bonanza. The call went as follows and I do paraphrase: Read the rest of this entry »

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Let us clear something up regarding the last financial crisis with housing at the center of the market unraveling. The vast majority of the foreclosures that happened in the Great Recession occurred on standard 30-year fixed rate mortgages. There is this mythology that only subprime and NINJA (no income, no job, no asset) loans were the culprit of the entire collapse. This narrative fits into the crony capitalist mentality that somehow, only losers caused the crisis and that of course all of the suckers that got lured into a toxic mortgage somehow deserved losing their homes (while banks of course got bailed out with billions of tax payer dollars). A swift kick to the poor, and corporate welfare for the banks. It almost fits into this modern psychology of dis-information and revisionist history that we are now seeing.  So it should be no shock to rational individuals that now, we suddenly have a whopping 4.7 million mortgages in forbearance (aka not paying their mortgage payment). This is not a good thing. The assumption is that people are going to start paying their mortgages back on time once the virus goes away but is that the case with so many jobs being lost? First, let us show you some data on the previous crisis for those that somehow forgot who lost their homes based on the type of mortgage on the property.