Bring back the tax credit – It’s time!June 22, 2010
Sometimes NO News ISN’T good news. As predicted by me and by many others, since the tax credit expired – home sales would drop. SO it comes as no surprise to me that sales are downs significantly since the stimulus package ended. While the tax credit was not an astounding amount of money – it was enough to get people excited about the prospect of buying a home and receiving some financial benefit for their purchase. It just proves that while only a slight gain – in the eyes of home buyers – IT IS STILL A GAIN.
Overview of Data in NAR’s Existing Home Sales 6/22 Release
Was anybody really surprised by today’s EHS release by NAR? The drop to a 5.66 million rate simply reflects what most have known for a while now: that second-half expectations will be tempered to reflect the pull-forward of sales brought about by the stimulus.
To sum: May’s transactions were up 18% nationally (when compared to May ’09), with all four regions showing double-digit gains led by the South (up 22%). For the second straight month, all four regions had higher mean average sales prices than the same period a year ago. Inventory declined marginally to 8.3 months.
South – April sales up 22% over 5/09, ASP up 3%. The South’s ASP is now 18% below its peak (hit 10/05) and 14% above the trough (reached 2/10). Transactions have been up vs. LY for 9 straight months; price, 5 straight months. LTM sales volume in the South is at about the same level as in May of 2003.
Bring back the credit. As home sales goes – goes the economy. Improved retails sales, increase in jobs, and more general spending by the American public. It doesn’t take a Harvard educated economist to figure this one out! Bring back the tax credit.