The Commerce Department issued a report today that confirmed the extent of the problem in the US housing market. November new home sales fell to a seasonally adjusted rate of 647,000 units. That is a 34.4% drop from last November. In the West the drop was just as pronounced with an estimate of 157,000 new homes sold from 237,000 a year ago. This drop is especially disheartening given the price drops, incentives and other means home builders have been making to dispose of their inventory. Inventory levels grew to 9.3 months which has only been surpassed twice since 1981.
It hardly takes an Econ degree from Yale to tell you that when demand has evaporated (due to the credit crisis), supply is growing (you can't just turn off the spigot) that prices will continue to fall. The massive write-offs being taken by the financial institutions will make their way to the underlying assets.
In this falling market the silver lining for California homeowners who purchased their property in the peak bubble years - 2004, 2005, 2006 - will be to apply for a decline in value in their property values to lower property taxes. Visit our parent site at http://lowercaliforniapropertytax.com/default.aspx to find out more.
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment