Let’s face it: the U.S. housing market is still under severe stress. No matter how the bulls may spin their argument, it’s far from a real recovery. The historical fundamental factors behind a typical housing market recovery are still missing.

According to real estate information company Zillow, in the second quarter of this year, almost 24% of all homes with a mortgage in the U.S. housing market had negative equity (the homes were worth less than the mortgage issued on them). More than 12 million home owners in the U.S. economy remain “underwater.” And in some geographical pockets, the spread between the mortgages and the values of the homes is very wide; in the Las Vegas area, almost 13% of home owners with a mortgage owe two times the amount of their home’s current value! (Source: Zillow, August 28, 2013.)

Sadly, the misery in the U.S. housing market doesn’t just end there.

The delinquency rate on single-family residential mortgages at all commercial banks stood at 9.41% in the second quarter of 2013. Yes, it has declined a little from 9.7% in the first quarter of this year, but it still remains very high compared to the historical average. (Source: Federal Reserve Bank of St. Louis web site, last accessed October 7, 2013.) The average delinquency rate on single-family residential mortgages from 1991 to 2006 was only 2.2%.

These negative factors working against the housing recovery are just a few of many.

Since 2012, the majority of activity in the housing market has been the result of investors buying up homes, renovating them, and renting them out. We didn’t really see the average American Joe buying a house to live in, as the activity in one indicator of the housing market I follow—first-time home buyers—has been lagging.

Since U.S. homebuilder stocks reached their peak earlier this year, they have declined almost 25%. The chart below shows their demise.

Chart courtesy of www.StockCharts.com

In the chart above, if you look at the moving average convergence/divergence (MACD)—an indicator of momentum—it indicates that some investors/speculators were buying homebuilder stocks in the beginning of September, but then the buying momentum faded. What really surprised me is that the Federal Reserve’s announcement that it would not taper did not result in the homebuilder stocks rallying!

I remain skeptical. All the talk we hear in the mainstream about the housing market being strong and robust, I just don’t buy it. Sure, I completely agree home prices in the U.S. economy have increased; but they had to increase, because they fell off a cliff! Home prices are still far from their 2006 highs, and the “recovery” in the housing market is very suspicious to me.