Home Sales up
Given what our market has been through, lets think with our common sense and jump to some apparent obvious conclusions about what we would expect. With the enormous number of foreclosures, and short sales that have a negative affect on house prices, and the fact that so many buyers were eliminated from the buying game when mortgage qualification guidelines tightened, we know why and where the drop in home prices on average came from. Right? That all seems like commons sense. Now that value of all homes in America just about are less than they were a year or more ago, anyone buying those homes today would be buying them at a lower amount then before…more common sense. So when we here reports that the number of homes sold in April or May this year is a little from last year, but the average price per home is less, we shouldn’t be pessimistic and say, “who cares that the number of homes sold increased cause prices are down”. That is not a fair statement because the homes sold today have to be less on average and the number of homes sold increasing is the best first sign we can expect. Right?
CNN reported, “Existing home sales rose 2.9% while the median sales price fell 15.4% to $170,200”.
Average Sale price down
Lets not worry so much about the average sale price of homes just yet. America saw too many job losses and pay cuts for us to have a bustling appreciation on sales prices just yet. Let Americans get some placebo going in the right direction and as we start making an extra dollar, we’ll get right back on into our good ole American ways…spend and leverage “babe”! Once that happens, then we can focus on home prices. Keep this note on your fridge though, over correction is in the forecast for 2010 and mortgage rates are expected to be in the high 7% range at best…they might have started that assent last week by the way the volatile market is playing out. We had two interest rate “worsenings” just today.
The foreclosure numbers haven’t stopped, and there are more to be expected.
Forbes reported that in March the unemployment rate went to 8.5%, the highest in 25 years. Economic forecasters figure that we’ll see a continued problem in foreclosures at least through this summer and fall.