Existing home sales and mortgage applications
The news of rocketing home sales was plastered all over the headlines. However, mortgage applications are going in the exact opposite direction (of course little was reported on this):
The median home price in the US is $214,000 and from multiple reports, most Americans don’t have much saved up (definitely not enough to buy a home without a mortgage or even a car for that matter). This trend simply highlights the massive power being wielded by the cash buying crowd. Someone is buying these homes and if mortgages are not being used, something else is being used. The cash buying crowd has always been around but as a small subset of the market. Today, it is one of the biggest players out there. The group is big enough to push prices up as it has over the last few years.
The chart above simply adds more evidence to this scenario. Your regular buyer is being pushed out of the game while investors continue to battle over what inventory is available. Yet we are now seeing that an inventory bottom was reached in March of 2013: