Good Morning Middle America, your King of Simple News is on the air.
U.S. NEWS: I can see that our government needs my services at this difficult time and place. They need for me to explain a few economic details that are bewildering to our leadership. Of course, third grade math is bewildering to our leadership, so such things as a 14% drop in mortgage applications is pure wizardry in comparison.
This calls for an in-depth study of the dwindling mortgage application situation, a study applying the advanced method of Mikeronomics.
To begin with, the latest month of foreclosure proceedings was 115% higher than the same month a year earlier. Throw in the steepest continual decline in home values seen in recent history and what you have are suicidal real estate people.
Asking someone to purchase a home in this market would be like watching a bungee jumper hit the ground and asking if anyone else wanted to try it.
However, there are far more serious issues to the housing market than those just discussed. After years of allowing anyone who could pass the fog-on-the-mirror-breath-test to qualify for a no-down low-down deal, we have about weeded out all of the buyers who shouldn’t have been given a loan to begin with, which seems to have accounted for the majority of the housing sales.
Going from zero down without the bothersome proof of the income necessary to pay the loan back, to having to provide a down payment and actually having a job, seems to have slowed down the process even more. Go figure.
Add to this the fact that some 3 million folks are putting their homes back on the market due to foreclosure and you would think that would be pretty much be the icing on the cake…wouldn’t you?