You can't be upbeat about home sales during these economic times.Hat tip: 808housing (Hawaii).
The purchase of a house is the ultimate confidence indicator, and if there's anyone out there with any confidence these days after what the markets and the financial sector have been through, then you're talking about the true eternal optimist.
August existing-home sales dropped a little more than 2%, the National Association of Realtors reported Wednesday, and overall sales are down more than 10% from a year ago.
August sales, though, represent the closing on houses on which a purchase contract had already been signed, meaning the actual decision to buy those houses was made in May or June, before economic events started spinning out of control....
As if those monumental items weren't enough to give potential home buyers the jitters, factor in a deteriorating job market — the economy has lost jobs for the last eight months and unemployment has risen near a five-year high — and house prices that continue to fall in many parts of the country and you understand why the housing market looks like a sunken soufflé. ...
But don't read rebound into those tea leaves. The uncertainty among housing consumers is not abating. And as we watch this week as Washington tries to fashion a bailout for the economy — which may or may not include any actual relief for beleaguered homeowners or any direct shot in the arm for home sales or any mechanism to shore up home prices — we are only likely to grow more afraid, not less.
Folks forced into the housing game in the last quarter of the year better be prepared for some rough stuff. For everyone else, watching the carnage from the stands will be the safest vantage point.
Tuesday, September 30, 2008
Don't Buy a House in Uncertain Times
MarketWatch says "You don't buy a house in uncertain times":