The White House keeps telling us that we’re in a recovery, yet anyone watching the economy, housing, foreclosures, unemployment, the stock market, commercial real estate, and dozens of other factors will tell you that they have some rose colored glasses glued on. Of course, if they didn’t, what they would tell us is that things are bad – getting worse – and they don’t know what they are going to do about it.
With that in mind, the commerce department announced today “that sales fell 3.6 percent to a seasonally adjusted annual rate of 402,000 from a downwardly revised 417,000 in August.”
It was the first decline since March. Sales in September were off 7.8 percent from a year ago. Despite the surprising decline, the market is up 22 percent from the bottom in January, though down more than 70 percent from the peak in July 2005. The median sales price of $204,800 was off 9.1 percent from $225,200 a year earlier, but up 2.5 percent from August’s $199,900.
Many blame the coming end (maybe?) of the $8,000 new home buyer tax credit for the decline, but that is just a simplistic explanation. As I mentioned previously, there are a plethora of factors that are at the core of our housing slowdown. Until we see a solution to these, no gift to new home buyers, no matter how big (and a big thanks to the government for considering that folks who already own a home might be able to stimulate things with a credit as well – NOT) , will stop the market from the troubles it is facing.