It is not looking good for the US housing market.

One week ago, when we reported that "On Manhattan's "Billionaire's Row", A Death Knell Just Tolled For Luxury Real Estate", we documented the sudden trapdoor that opened beneath the ultra-luxury segment in the Manhattan housing market. Then several days later, we observed that it is not just the luxury NYC market that is in trouble, but the broader market across all of the US, when we noted three "Red Flags" that the broader US housing market was starting to roll over, among which i) a surge in inexperienced, third-party "mom and pop" auction buyers who were arriving just as institutional investors are starting to flee the auction market, ii) a collapse in retail purchases for home goods and furniture - traditionally a coincident or slightly lagging indicator of home purchasing activity, and iii) a plunge in housing buyer traffic according to the Credit Suisse real-estate agent survey.

Then this afternoon, another flashing red flag emerged when we learned that overall sales in the Hamptons plunged by half and home prices fell sharply in the second quarter in the toniest enclaves of the Hamptons, New York's weekend haunt for the wealthy. Reuters blamed this on "stock market jitters earlier in the year" which damped the appetite to buy, however one can also blame the halt of offshore money laundering, a slowing global economy, the collapse of the petrodollar, and the drastic drop in Wall Street bonuses. In short: a sudden loss of confidence that a greater fool may emerge just around the corner, which in turn has frozen buyer interest.

And frozen it has.

According to realtor Town & Country Real Estate, total sales volume in East Hampton fell 53% from a year ago to $44.7 million as the median sale price fell 54% to $2.38 million. In fact, a drop this steep has not been observed since the financial crisis.

A beachfront residence is seen in East Hampton, New York, March 16, 2016.

In Southampton, total sales fell 48% from the second quarter of 2015 to $45.3 million, with the median sale price falling 21 percent to $1.65 million, data showed.

In East Hampton, only 12 homes were sold and 17 in larger Southampton, due to a lack of inventory and because sales typically lag when the stock market underperforms, said Judi Desiderio, chief executive at Town & Country.

"This is just a shift of the needle that I expected because 2014 was a high cycle for the high end," said Desiderio, who says luxury home sales in the Hamptons run in seven-year cycles. The stock market surged 30 percent in 2013, with record sales in excess of $100 million set the following year.

In the 12 submarkets that make up the Hamptons, sales volume slipped 18 percent from a year ago, with the median price falling to $999,000 from $1.1 million, Town & Country data showed.

Sales in the Hampton submarkets of Shelter Island and Sag Harbor surged after several years of poor performance. The median sale price in Sag Harbor jumped 37 percent to $1.43 million, and 27 percent to $950,000 in Shelter Island.

Despite the clear crash, local realtors remain hopeful: third-quarter sales should pick up, in part because Wall Street touched record highs the past week and because the summer months are usually better, Desiderio said. Then again, if they don't, what is merely a trickle of selling now will become an all out liquidation as the greater fool bid is now officially dead.