[Skipping ahead to August 2007 when we were also on vacation during the second half of the month and, hence, could find no Jackson Hole material to replay last week, it quickly became clear when looking through the old posts that the housing market  was in very serious trouble, the mainstream media really picking up on the whole idea that maybe the bubbly prices of real estate wouldn't stay elevated forever and that maybe things were going to get ugly out there. First published on August 2, 2007, the story below reminds us all what it was like before things really went south beginning in 2008 -  back in 2007 when everyone's fate had already been determined and the only variable was the timing.]

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You don’t truly understand the psychology behind the housing bubble until you see how dopey some of the participants are and, more surprisingly, how willing they are to share their stories with millions of people.

It’s one thing to lose your shirt, it’s another to tell your story on national TV.

Admittedly, Casey Serin of the now defunct iamfacingforeclosure.com has set the bar quite high, but Bruce Helmprobst turned in a stellar performance on last night’s ABC Evening News, providing another sad example of what happens when our “fifteen minutes of fame” culture in the YouTube era meets up with the latest financial bubble.

Charles Gibson: One reason for the volatility in the market these days are the concerns about the mortgage market. Home foreclosure notices were filed against 573,000 homes in the first half of the year, an increase of 58 percent over last year – devastating for some, opportunity for others. ABC’s Miguel Marquez takes a closer look.

Miquel Marquez: In a sign of how low the housing market here has sunk, Joyce Essex used to make most of her money selling homes. Now, 90 percent of her business comes from handling foreclosures.

Joyce Essex (Realtor, Coldwell Banker): Basically, up to this point, the banks have been able to sell the properties for real retail prices, but just recently, they’re starting to get so many properties that they have to get them off their books.

Marquez: All of last year, Essex handled 16 foreclosures, now she handles one a day.

(more…)

You’d have to think that, at some point, the Commerce Department is going to lose interest in reporting the monthly housing starts data since, if the graphic below were an EKG, the patient would clearly be dead. Nonetheless, they push on, today’s report(.pdf) indicating that housing starts fell 1.5 percent to an annual rate of 604,000, right around the historically low average level of the last three years since the housing boom went decidedly bust.

Permits for new construction fell 3.2 percent to an annual rate of 597,000, but, nobody really cares.  Of more interest to housing market observers these days is whether wards of the state Fannie Mae and Freddie Mac will continue to exist in their current form and if they might someday soon turn into the nation’s largest landlord, renting out the millions of foreclosed homes that they either already own or will take back in the years ahead.