Aug Existing Home Sales and what happens next?
Existing Home Sales totaled 5.1mm annualized, 250k less than expected and down from 5.24mm in July. The chief economist placed some blame for the shortfall in closings relative to expectations on “rising numbers of contracts entering the system, with some fallouts and a backlog contributing to a longer closing process.” The NAR said 30% of buyers were 1st time, where many took advantage of the tax credit, and 31% of sales were distressed. The median price fell 12.5% y/o/y and 2.1% m/o/m. The positive within the data was months supply which fell to 8.5 from 9.3 and is the lowest since Apr ’07. The two key hurdles the industry must now face is an inevitable increase in foreclosures as many 1st half moratoriums have come to an end and the uncertain destiny of the tax credit which the industry is certainly begging but has become an expensive subsidy from the rest of us.
Tweet
Facebook
Reddit
Digg this!
September 24th, 2009 at 11:09 am
Loads of supply ready to come on the market from banks and flippers (i mean, “investors”), not to mention the unfortunate, the unemployed and the underwater. The cat bounced, but it’s still dead.
September 24th, 2009 at 1:28 pm
tax credits are a waste of taxpayer’s money- the majority of the buyers would have bought anyway- if you look at just the sales that would have occurred because of the tax credit- the actual cost per sale is close to $40,000-
not a good deal in my book
September 24th, 2009 at 4:16 pm
“The positive within the data was months supply which fell to 8.5 from 9.3 and is the lowest since Apr ‘07.”
Why is this positive? Housing prices need to come down to a level where Americans can actually afford to buy them (what a concept!). Keeping prices up only helps the banks.