The other day, in EXISTING HOME SALES PROPAGANDA SPREADS AT A BIZARRO THEATER OUTLET NEAR YOU, I gave you the Flip ratio and the Glut ratio, which better explain residential realty. Now, I give you the Homeless ratio.
The Homeless ratio looks at net charge-offs in relation to delinquencies for all single-family residential mortgages secured by real estate and booked in domestic offices of all commercial banks.
As you can see, the Homeless ratio falls as house prices fall and experiences violent peaks after sustained run ups in prices.
Now, let's check out average house prices and average house prices to average income.
From a house price perspective, this has been the best time to buy since 1980 though not the best time to buy relative to income. That said, if you have the a solid income and have wanted to become a mortgage payer rather than a renter, the window is open for a once-in-a-34-year opportunity.
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