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"Correction Inevitable, Could Be A Doozie"

The Australian has a report out with more details of the speech by Fed honcho Jack Guynn. "He was especially concerned about reports of speculators buying homes and condos 'just to flip them for a quick profit' and that banks and other financers are taking big risks in the area."

"'It seems like every week brings new stories about aggressive financing arrangements that encourage and enable such real estate transactions,' Guynn said."

"New data overnight showed sales of new US homes edged up 0.2 per cent to a seasonally adjusted annual rate of 1.32 million, an all-time record."

"Diane Swonk, chief economist at Mesirow Financial, said, 'The concern is the further we go, the more risk we run of a significant long-term correction."

HBs' Stock Up Double Digits In 10 Days

Many of this blogs' readers are watching for the top in the US housing market. This chart of the homebuilders KB Homes and Toll Brothers exhibits the kind of 'blow-off' action one would expect to cap a multi-year mania. Notice the move from May 13th to date.

All Eyes On Fannie Soon

Fannie Mae has the April monthly summary report scheduled to come out any day. This post took a close look recently and the April period should be interesting.

Buyers, Builders, Lenders May Get "Burned"

Atlanta Federal Reserve Bank President Jack Guynn added to the housing bubble debate with these comments. "'There are some local markets, especially in coastal Florida, where I've heard stories for more than a year about behavior that's got to be characterized as nothing other than speculation,' Guynn said it response to questions after his speech."

"'It makes me very uncomfortable. Some buyers, some builders, some lenders are going to get burned, could very likely get burned, in some of those local markets,' he said."

"The U.S. Federal Reserve is not yet done raising interest rates, but the central bank will watch economic data closely in an uncertain time for monetary policy. 'Given the current outlook for the economy, my personal view is that we've not yet reached a neutral policy stance,' Guynn noted."

7% Of LV Listings Reduce Price In The Past Week

The Las Vegas web site that has a search function for homes reduced in price the last seven days has reposted the results. It reports that out of 16,346 total MLS listings, 1,133 have had prices cut in the last week. That's 6.9%.

Maybe the webmaster is playing some blog-chicken with THB, but you might hurry over and look before they realize what's up.

Spanish Mortgage Debt Up 25% In One Year

In Spain, the RE boom has pushed the country to the brink. "Household debt in Spain surpassed disposable income for the first time last year, posing risks for the stability of the financial system, the Bank of Spain said Monday."

"The increase in indebtedness of Spanish households is largely the result of much bigger mortgages to acquire the family home due to an ongoing property boom in which house prices have risen about 150 percent since 1997."

"According to figures from the Spanish Mortgage Association (AHE), total outstanding mortgage loans at the end of March stood at a new record of €615.132 billion, a rise of 24.5 percent from a year earlier."