ATM Broken

The housing ATM is out of service. Those people who have been living beyond their means thanks to a rising tide of home equity had better start saving. The whole refinance game is kaput. What are you going to do now if you've been living comfortably by using your house as an ATM? Interest rates are higher and home prices are down in many cases. Time to stop going out to dinner three times a week. Time to stop buying all that crap you don't need...and charging it.

Equity withdrawal has certainly provided a wind in the sails of our economy. Without it we won't be seeing much growth in GDP. Furthermore, most of the nation's job growth the last couple years has been housing related. Brokers, appraisers, agents, roofers, electricians. Here in SW Florida you couldn't walk five feet without running into a mortgage broker and they were generally obnoxious and arrogant about their new found success. The number of available jobs in housing related sectors will not grow but contract.

Belt tightening time. Prices are drifting lower, rates are drifting higher, there is enough inventory to choke on and lending standards are being tightened. There has already been a lot of bottom calling. Strikes "The Skeptic" as premature.