Home sale statistics

The US Commerce Department reported today that new home sales fell 10.2% in January, which is a record low.

The National Association of Realtors reported that sales of existing homes fell 5.3%.

What does this mean?  The American Recovery and Reinvestment Act has its work cut-out for it.

Everyone agrees that things are likely going to get worse before they improve.  Eight hundred billion dollars and change might not be enough to make an impact worth noting.

Progress should be celebrated, although it makes me wonder how much more money we’ll have to print to make the government program work.  Printing more money is easy, but creating a bailout mentality for America is the part where I take exception.

If we eliminate the efficiency of capitalism, the smart money will eventually go elsewhere. Until that happens, we are living in one of the best times to buy real estate in the history of the United States.  The smartest people I know are buying as much real estate as they can.  The first-time home buyer tax credit makes it easier for many people.  Our record low mortgage interest rates help too.

www.mangledmortgage.com

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2 Comments

  1. raveler said,

    February 26, 2009 at 3:23 PM

    First of all, the government decided we should all buy homes, they did this by inticing us with a home owner mortgage deduction, so we could itemise and reap the tax benefits of home ownership, which is exactly what most of us who could afford it did. Next they decided low income people needed to share in the windfall, so they ecouraged the Federal Reserve to keep intrest rates low while fanny and freddy and a host of others made irresposible loans to people who couldn’t, or wouldn’t pay. Now they come up with a bailout plan to back their previous fiscal irresponsibility, and keep those pending foreclosure in those homes, (at the tax payers expence I might add). And now the coup de grace; our government is considering revoking the home owners insurance deduction, the same deduction that enticed many to buy homes in the first place. This will amount in a cataclysmic income tax windfal for guess who? (the government). I must go now,
    ; for my chest pain is unbearable, but I agree, If you have working capital buy real estate, vacant land, and make sure you get the mineral rights.

  2. mangledm said,

    February 26, 2009 at 3:30 PM

    It’s a messy situation, for sure. Don’t forget about the hedge funds who told the banks to loosen their lending standards. The loose lending standards put people into mortgages with high-interest rates so the hedge funds could show a great rate of return. You can see how well that worked-out for the long term by the current condition of those hedge funds.


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