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Existing home sales tumble in January
Friday, February 26, 2010
The National Association of Realtors reported that sales of existing homes fell 7.2 percent in January to an annual rate of 5.05 million units after a plunge of 16.7 percent in December. This comes following a surge in home sales late last summer as the homebuyer tax credit was believed to be about to expire, a program that has since been extended through June.
The median sales price for existing homes was unchanged from a year ago at $164,700 and first-time homebuyers were said to account for 40 percent of purchases during January while investors were responsible for 17 percent of all transactions. Sales are expected to increase again in the months ahead as the April 30th contract signing deadline for the tax credit nears.
Anyone looking to buy a house would do well to consider this item at the WSJ Developments blog that asks whether it's better to wait to buy. The short answer is that, unless you really need the tax credit and can't get financed at mortgage rates at much over five percent, you'll probably be a lot better off later in the year because, unless these two conditions persist, lower prices are likely ahead.
5 comments:
Interesting.... Now there's a huge gap again between the sales and the months of supply....
The prices are being levitated by very expensive taxpayer subsidies. Its double trouble for buyers. Not only do they have to pay higher prices, but they have to pay higher taxes to subsidize the unwanted higher prices.
Madness.
Assuming one can afford it and plans to stay in the same home for many years, the real money to be made buying a home is in the mortgage. After inflation takes off in a few years that $2,000/mo mortgage payment of yours will seem more like a car payment. Heck, the insurance and taxes will be far greater than your note. But if you're still renting by then, your rent will be many times what the house payment would have been.
It'd be nice to buy it at the rock bottom, but at some point events may get out of hand and one could wind up with a 10% mortgage instead of a 5.5% one. I'm glad I already have a home in a stable market at a low fixed interest rate.
House sales down? It is those pesky mortgage lenders- something about having to have a job,first.
"But if you're still renting by then, your rent will be many times what the house payment would have been."
Actually not, because demand for rentals will be so extremely low.
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