“The buyers just disappeared off the face of the earth.” – Shauna Pendleton, a Boise real-estate agent for Redfin

Over the course of the summer, there’s been a stunning collapse in home sales. For July, new home sales fell 12.9% from June (seasonally adjusted annualized rate) and 29% YoY. However, the Census Bureau includes the “unadjusted” monthly data – this is a metric that is based on the Census Bureau survey of homebuilders – though the media ignores it. On a YoY basis for July, new homes sales plunged 32%. Toll Brothers’ FY Q3, reported earlier this week, experienced a 60% decline in new contracts.

Based on all of the data available currently, I can say with confidence that it is starting to look like the coming housing bubble collapse will be considerably worse than the one in 2008. Because of the financial condition of the majority of prospective homebuyers, a Fed pivot will not revive the housing market – it’s headed into a severe crisis:

I have been focused in my Short Seller’s Journal on finding short ideas to take advantage of the stocks that are not remotely pricing in the coming housing market depression. I recommended Opendoor Tech ($OPEN) at $21 in November 2021; Realogy ($RLGY – now called $HOUS) at $16 early in 2022; Zillow ($Z) well before the stock price collapsed; and a plethora of homebuilders plus a couple real estate REITs (Public Storage $PSA at $400 earlier this year). There’s a lot more wood to chop from the short side. You can learn about my newsletter here: Short Seller’s Journal info