Hey!!! Guess what!!!! Our housing market wasn’t as strong as some were saying it was! Many people have been heralding the comeback of the US housing market. Others remained unconvinced. Here’s some news ……
WASHINGTON (AP) — Americans bought fewer existing homes in September than the previous month, held back by higher mortgage rates and rising prices……
Mortgage rates rose sharply over the summer from their historic lows, threatening to slow a housing recovery that began last year and has helped drive modest economic growth.
But many economists expect home sales will remain healthy, especially now that rates have stabilized and remain near historically low levels. Final sales in September reflected contracts signed in July and August, when rates were about a percentage point higher than in May……
Because, when rates are at historic lows, you can expect them to remain there, or something. Idiots.
First-time buyers are having trouble qualifying for loans because many banks have adopted tougher lending restrictions and higher down payment requirements since the housing bubble burst. .
Fear not!!! We have the solution!!!
SAN FRANCISCO (Reuters) – U.S. home sales will likely pick up if house prices continue to rise, according to a study published Monday by the San Francisco Federal Reserve Bank.
That’s because the current sluggishness of home sales is most likely due to homeowners optimistically holding out for better sale prices, the study suggested.
I don’t know, but, it seems to me, in a life long ago and an place far away, we once had a system to where home prices were rising, not because of a demand for housing, but, because of a demand for money.
We never really did correct the underlying problems of the housing crash. There is a demand for housing, but, as the previous article stated, the restrictions are too high to meet the demand. It’s mostly because of pricing. But, that’s the same problem we got into the first time. Homes were overvalued. Yes, we built and sold and resold homes like no one’s business, and people made fortunes! Sadly, when the crash came calling millions were left holding the bag of empty value. Most of those notes never really went away. So, yes, if the prices of housing go up, people will see a profit potential and we’ll start anew. Doing the same exact things which signaled the collapse of the global economy.
Economics is only a description of natural laws. Like physics, you can’t beat them. They always apply. We may not always define these natural laws properly, but, you can’t change them. And, you can’t ignore them without paying the piper.
Our housing market was never allowed to fully crash. So, our base value of our housing market was never found. Sure, let’s start flipping homes again and play that game of musical chairs again. When the music stops, someone doesn’t have a seat.
The laws of economics demand losers as well as winners. Even if the bankers are the losers. By failing to allow losers, you fail to allow winners. What we’re seeing now is an attempt to multiply the errors of the past. So sure, let’s start another housing boom selling homes for a few $hundred thousand which hold real values of about $50,000 and see if we can’t win that game, again. Surely it was just poor execution rather than just being wrong. Now where have a heard that tragic thought expressed before ……..?