What a Major Indicator of “Housing Busts” is Showing Now
“It was the first such decline since November 2015”
by Bob Stokes
Updated: July 21, 2022
The housing market tends to go the way of the stock market, and nearly everyone knows that the stock market has been sliding.
There's another housing market indicator that our July Global Market Perspective mentioned:
[Home] sales declines invariably lead the way into housing busts. This one... should arrive faster and more forcefully than the experts expect.
Homes sales have already begun to decline:
- U.S. existing home sales fall for third straight month; house prices at record high (Reuters, May 19)
- Sales of existing homes fell in May, and more declines are expected (CNBC, June 21)
Sales of luxury homes in some areas have dropped significantly. As examples,, in Nassau County, NY, Oakland, CA, Dallas, TX, Austin, TX and West Palm Beach, FL, annual drops in the rate of upper-end home sales for the three months ended April 30 stretched from 32.8% to 45.3%.
As June numbers roll in, more signs of a real estate slowdown are evident. For instance, the number of active U.S. home listings jumped 18.7% in June from a year earlier, the largest annual increase since the data started in 2017.
The housing bubble is by no means confined to the U.S. Bloomberg reports that New Zealand, Australia and Canada look even more "frothy" than the U.S.
And, then there's China. Here's a chart and commentary from our June Global Market Perspective:
Month-to-month prices of China's new-home sales turned negative in September, and they've continued to fall since. The year-over-year average of new home prices also fell in April. It was the first such decline since November 2015.
In Elliott Wave International's view, housing markets around the globe are on shaky ground and those who bought at the peak of this latest housing boom better be prepared.
Get our detailed analysis of housing, global economies and 50-plus financial markets around the world.
Get started by clicking the link below.
The Biggest Global Financial “Shift” of a Lifetime: Starting Soon?
Elliott wave analysis strongly suggests the answer is yes.
The charts and Elliott wave labels lay out the forecast in our July Global Market Perspective.
Yes, some of the 50-plus financial markets in GMP's monthly coverage are closer to the "shift" than others...
...Yet the overall global financial story is eyebrow raising.
Get ready for a global financial "shift" that will likely unfold swiftly.
Follow the link below to read our July Global Market Perspective, plus get instant access to the June & May issue so you can catch up and prepare now.
Mainly just seven stocks have been holding up the U.S. stock market. As EWI recently noted: "There has never been such a high weighting in the S&P in such a few number of companies." Elliott wave analysis can help you anticipate major shifts in crowd behavior.
Many investors believe that the stock market reacts rationally to news like corporate earnings, oil "shocks," economic data, Fed announcements and so forth. But does the evidence support the notion of such exogenous causality? There are several examples of stock market "myths" and here's just one of them.
The cryptocurrency stage has a clear standout: Solana. On November 16, the world's #6 crypto soared to 18-month highs, outperforming all cryptos in Oct. and Nov. SOL's surge was right in line with its bullish Elliott wave pattern -- NOT a ChatGPT prediction.