For sure it's a correction.

I hope you all enjoyed your weekend because on Friday I turned into the biggest housing bear on the planet. I'm fully in the cave waiting to hibernate for the winter. Which might come as a surprise to almost everyone who reads this blog. I think there are very few scenarios where buying a house isn't a good idea. I think the rent trap is a far greater problem than most things that come up with houses.

The seeds for this particular freak out started last weekend. Driving down to Monterrey there was this tiny development. It might have been 20 units tops. At first I was happy because the further away from the core (Silicon Valley) the less things have improved. It was nice seeing something new being built way down there.

However on the way back we were stuck in traffic and passed that same  development again. And I was like - what the hell is up with their Tyvek? Mr S. looked at it and said - yeah. It looks like it's been through a tornado. Which is when I realized that development had stalled and probably has been dead for a while. Since prices have been going up so much everywhere, it's pretty surprising to see a dead development. That never happens in an up market. Only in a down market.

Then last week the media finally caught up to reality and everyone was carrying the price drops. My girlfriend said it takes about three months for the media to catch up and she started seeing this weakness in May. So, we are right on track.

And finally - fully half the properties in my town  on the market are 3000 square foot and above. This is an extraordinarily high level. 42 properties. Those are big houses and don't move quickly. And it looks like the high end is suffering everywhere.

But it isn't just the top end that is showing strain.  Two mobile homes came up in my city. They almost NEVER come up. And one of them actually had a price cut. On a mobile home! That is the lowest end of the market.

It seems we have a lot of cross currents right now. At the top end the SALT deduction. Which I have mixed feelings about. Mostly because really rich people always come out to say - we don't mind paying higher taxes. But it looks like those phonies do. Usually they can get around paying higher taxes some other way and balance it out, but they know you also get stuck with higher taxes and it isn't as easy to balance it out.

At the low end there are higher interest rates. Interest rates have been going down since the 70's. Except for a few blips. And unless this country burns down, you will never see interest rates as low as they were through the recession ever in my lifetime. I think.

We almost went into negative interest rates! That's why I have a nihilist Audi! I wasn't going to pay my bank to hold my money. That's ridiculous. But I digress.

Anyway. Even I might believe we are in stage two of a bubble burst. We've already seen loan officers get laid off. It hasn't been en mass yet... but.. I think things are going to get a little sideways.

There's trouble ahead in the global housing market