The Wall Street Journal missed it ... and so did almost every major media outlet.
When the new statistics on new home starts and pricing came out last week, the good news was overwhelming. Housing sales were up 6.5% "to break yet another record," reported WSJ.
So what did everybody miss? Namely, one small detail that tells more about the housing market than most statistics ... and very possibly is the first crack in this enormous real estate bubble. Get this:
The median price of a home fell in July by a whopping 7.2%.
And the details paint an even more alarming picture of the staggering decline in the U.S. housing market. Since April, median home prices have fallen 14% ... They fell from $236,300 in April to $203,800. Take a look at this: investmentu.com
"The stock market tends to lead the economy (that's why it's best to buy stocks in bad times, and sell them when times look too good). If this is true, then housing stocks (homebuilders) might be said to lead the market for new homes," says Dr. Sjuggerud, Chairman of the Baltimore-based Investment U.
Housing market stocks have soared for a few years now. However, they've been falling in the last month or so. In fact, the entire index is down roughly 10% from its high a month ago.
Now is not the time to speculate in real estate. Simply put, your downside risk is greater than your upside potential right now.
"My advice to private investors is to pay down their mortgage to the point of having more than 50% in equity, instead of taking equity out and speculating in real estate. I really believe that, in five years, you'll be very glad you did," says Sjuggerud.
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