Another month, another housing report and another way off the mark figures by the independent economists and the government. The figures are saying that the existing house sales fell by the worst percentages in 40 years. What does this say about the housing market and all the stimulus being or have been poured into it. It says that do not read too much into it. As I have said in my previous posts, the economists look at the long term trend, not only a month or so surprises.
There can be a lot of factors in play here that can distort these numbers, like the end of the housing stimulus (Remember the USD 8,000.00 tax credit), the winter season (when housing slows down), the renewal of the new housing stimulus, the loss of more jobs etc.
The biggest one of these is the Job losses and the lack of confidence that it brings to people. If people don’t have jobs they will think twice before jumping into buying a house and the assorted and unexpected expenses that it can spawn.
Right now people are struggling to get their life together with all the debt and other obligations and they are least bothered by the down payments and other paperwork you need in order to secure the keys of your dream (affordable) house.
Or you can say that it takes an average of 60 days to have your mortgage approved and all the papers signed, so you may yet see more fluctuations in the housing markets in the coming markets.
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