Wednesday, 19 September 2007

Housing outlook continues to look grim

In case you missed it amongst the euphoria of helicopter Ben's antics, homebuilders confidence fell to it's lowest level ever.

The NAHB/Wells Fargo housing market index fell two points in September to 20, matching the all-time low for the index set in January 1991. The index, which gauges builder sentiment, dates back to 1985.

Numbers over 50 indicate more builders think conditions are good than think they are bad. So at 20, approximately one fifth of the builders say the housing market is good. As I expressed last month I'm surprised anyone thinks the housing market is good.

If that wasn't enough to dampen your enthusiasm, how about the fact that nearly a quarter of a million foreclosure filings were reported in August, up 115% from a year ago and up 36% from July. James Saccacio, chief executive for RealtyTrac had this to say:

"The jump in foreclosure filings this month might be the beginning of the next wave of increased foreclosure activity, as a large number of subprime adjustable-rate loans are beginning to reset,"
You better believe it is James. If you'd like to hear a not very upbeat interview with Rick Sharga of RealtyTrac click here.