15 Signs That The U.S. Housing Market Is Headed For Complete And Total Collapse

The American Dream

The U.S. housing market is dying. You will only hear hints of this on the mainstream news and from the politicians in Washington D.C., but as statistic after statistic continues to roll in, the reality of what is happening is becoming very difficult to deny. Up until the end of April, the giant tax credit that the U.S. government was bribing home buyers with helped stabilize the real estate market, but now that the tax credit has expired the decline of the U.S. housing market has resumed. Mortgage defaults continue to set new records. Foreclosures continue to set new records. Home repossessions by banks continue to set new records. The number of homes being constructed and the number of Americans applying for home loans is at stunningly low levels. For decades, owning a home has been touted as the very heart of "the American Dream", but today that dream is out of reach for an increasing number of Americans. Why? It is because there are not nearly enough jobs for everyone. Without a jobs recovery, there simply is not going to be a housing recovery. Unfortunately, as the U.S. economy continues to come apart like a 20 dollar suit, even more Americans are going to lose their jobs and the U.S. housing industry will continue to experience a very painful decline.

The truth is that this is not a short-term downturn in the housing market. During the past two decades, an insane amount of debt fueled an artificial housing bubble that drove home prices to ridiculous levels. Now the U.S. housing market is trying to correct itself, and no matter how many trillions of dollars the U.S. government throws at the problem the fundamentals of the marketplace are still going to have their way eventually.

So exactly how bad are things out there right now?

The following are 15 signs that the U.S. housing market is headed for a complete and total nightmare....

1 - Sales of new and existing homes in the U.S. are at depressingly low levels. For example, during the month of May sales of new homes in the U.S. declined to the lowest level ever recorded. Yes, you read that correctly. The U.S. Department of Commerce began tracking sales of new homes back in 1963, and since that time the number of new homes sold has never been as low as it was in May. Not only that, but existing home sales (which had been faring a bit better) are also showing signs of serious decline. In the month of July, sales of existing homes in southern California fell nearly 22% from a year earlier. In Austin, Texas sales of homes declined 25% from a year ago in the month of July. The truth is that home prices are still way too high. As prices begin to decline that should help home sales a bit, but the truth is that the days of the real estate boom are gone and they not coming back.

2 - Construction of new homes in the United States has screeched to a standstill. There are way too many homes for sale already, and so most home builders have dramatically cut back on their building plans. Construction of new homes in the U.S. and applications to build new homes in the U.S. both fell to their lowest levels in more than a year during the month of July. Unfortunately, it doesn't look like this is going to turn around any time soon. An important measure of home builder confidence fell to a 17 month low in August. There is a whole lot of pessimism in the housing industry right now, and that means that the employment outlook in all of the industries that depend on the housing industry is likely to continue to be quite grim.

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