Posts Tagged ‘housing inventory’

Will expanding the housing tax credits beyond first time homebuyers contribute to housing inventory woes?

Sunday, November 15th, 2009

The Capital published an intriguing article addressing the potential side-effects of expanding the housing tax credits beyond first time homebuyers. The article raises some fair questions with regard to existing homes needing to be liquidated so that current homeowners can take advantage of the housing tax credits now afforded to them. The Capital article focuses on housing inventory in D.C. and its surrounding area. However, this potential side-effect could present itself in other parts of the country.

DHW asks: Do you think expanding the housing tax credits beyond first time homebuyers will increase housing inventories?

Critics be damned. Home sales up, prices down

Tuesday, November 10th, 2009

Critics of the Housing Tax Credit were quieted, if only briefly, when the National Association of Realtors (NAR) released data for third quarter home sales. According to the trade group, home sales increased by nearly 6% over this same time last year. Despite the spike in sales, prices have fallen more than 11% during the same period. The U.S. median existing single-family price for the third quarter was $177,900.

Opponents of the housing tax credit feared an inflationary reaction in home prices. Although housing inventories are down, existing units still outweigh the demand.

NAR chief economist,  Lawrence Yun, predicts home prices will stabalize next spring. His prediction may be overly optimistic. Foreclosures and short sales made up 30% of thrid quarter sales. There is no real evidence to suggest foreclosures will take a breather in 2010.

DHW asks: Do you see a bottom to the housing market?