Real Estate says the market is lying.

Home flippers are fleeing the market as their profits shrink.

"In California, where home prices are highest, flips were down a steeper 22 percent annually."

Remember a few days ago I said home improvement would be next? Well, we now have a very predictable acceleration in a series of negative feedback loops.

Houses in which you do not live in are a full percentage point higher in interest. So, if rates are at 5%, someone flipping a house is paying 6%. Houses are sitting way too long now. It isn't uncommon to see things in the four month range, and lots are in the 1/3 of a year range. 100-200 days. I think the article says the average now is 186 days. And you can sort of see this coming through. A couple of weeks ago I saw a house that was bought, and then they stuck it right back on the market for like 20 grand more. Now it's been sitting for months.

Now, flippers have a bad name even thought they do an important service, so probably no one cares but the real estate figures for the Bay Area came in yesterday I think, and they were worse than Southern California.

Amid surge in inventory, Bay Area home prices rise more modestly.

"Throughout the Bay Area, new listings, active listings and price reductions all surged last month year over year, said Patrick Carlisle, chief market analyst with the Compass real estate brokerage.

The change was most striking in Santa Clara County, which had been one of the nation’s hottest markets for most of this year. There, new listings of existing, single-family homes were up 83 percent year over year in September, active listings were up 120 percent and the number of homes with price reductions was up 308 percent, Carlisle said.

In San Francisco, the comparable numbers were 28, 8 and 32 percent."

Santa Clara has had an incredible transformation in the past few years. More than any other city. But they are getting ready to open some massive housing developments. And tech stocks are way down.