April Housing Numbers Show There's a Sucker Born Every Minute?
CNN Money is reporting that April existing home sales blew away expectations based largely on the expiration of a $8000 tax credit. I'm sure getting into a still-overpriced home was totally worth $8000 to some of these people, whomever they are.
Can anyone else confirm that for sale signs dot every other home in their hoods? See, I live in San Francisco and can testify that we've got plenty more breathing room in our little 7x7 now that half the city has jumped ship. You would too if you had to pay $800,000 for a half a duplex with a window overlooking your neighbor's bathroom.
Anyway, CNN Money:
Existing home sales soared in April as home buyers scrambled to claim the tax credit that expired at the end of the month, according to a real estate industry report released Monday.
The National Association of Realtors reported that existing home sales jumped 7.6% last month to a seasonally adjusted annual rate of 5.77 million units, up from the upwardly revised rate of 5.36 million in March. Sales year-over-year were up 22.8%.
I'm sure that wasn't just a paid advertisement for the NAR or anything. *cough*
Wait, wait, here's the awful part:
The surge in inventory was larger than normal for this time of year and is not a “healthy” development, the NAR’s chief economist Lawrence Yun said in a press conference. The group cannot pinpoint what is driving the gain, he said. It’s either a release of pent-up supply, which implies there is also pent-up demand, or it may be investors dumping properties on the market, which will hurt resale prices, Yun said.
The so-called shadow inventory of homes taken over by banks or in the process of foreclosure may total as many as 800,000, while as many as 2 million additional dwellings are 90 days or more delinquent and headed for foreclosure, Yun said in an interview.
The increase in supply means there will be no “meaningful” increase in home values this year or possibly next, Yun said.
Shocked and amazed, I'm sure.
Without the shadow inventory it looks bad, could you imagine what would happen if those were to be factored in? But that would mean the banks would have to release these crap loans they've had rotting on sheet for months (years, in some cases) and we all know that's not going to happen any time soon.
Oh well. Keep sucking down that Kool-aid, everything is under control.