[mEDITate-OR:
think that some body is taking a dive...
into a very shallow pool of home buyers...
and that's not out there on Wall Street....
where IS The Answer to [y]our prayers...???
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While we really DO "Love our CR charts"
the explanations of "Why:" that Jim provides U.S.
and his "connections" to other thoughtful people
is almost worth more.
We really DO encourage you to read the CR articles
to go the the web site & then SEE all of those LARGE charts!!
and
to sign up for his DAILY newsletter.
You, too, will be very glad you did.
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Said Jim @ CR:
A few key points:
1) The Pending Home sales index leads existing home sales by about 45 days.
2) The peaks in the Pending Home sales index are related to the home buyer tax credit. For the 2nd tax credit, the peak for the pending index was much higher than the existing home sales spike. One reason is that short sales sometimes take longer to close - and since the tax credit closing date was extended, these sales will close later. But probably the more important reasons are: a) appraisals are coming in below the agreed upon price, because the asking prices for similar homes have fallen since the end of April, and b) some buyers put in offers on two homes to beat the tax credit deadline, and then decided which house to buy.
3) It is hard to tell from the Pending Home sales index how far existing home sales will fall in July and August. However, with the Pending home sales index below the lows of early 2009, a first guess might be 4.5 million or so. (Existing home sales in Jan 2009 were 4.49 million SAAR).
4) With July inventory of about 4 million units and sales of 4.5 million units (SAAR), the months-of-supply will be just under 11 months and that will put downward pressure on prices.
1) The Pending Home sales index leads existing home sales by about 45 days.
2) The peaks in the Pending Home sales index are related to the home buyer tax credit. For the 2nd tax credit, the peak for the pending index was much higher than the existing home sales spike. One reason is that short sales sometimes take longer to close - and since the tax credit closing date was extended, these sales will close later. But probably the more important reasons are: a) appraisals are coming in below the agreed upon price, because the asking prices for similar homes have fallen since the end of April, and b) some buyers put in offers on two homes to beat the tax credit deadline, and then decided which house to buy.
3) It is hard to tell from the Pending Home sales index how far existing home sales will fall in July and August. However, with the Pending home sales index below the lows of early 2009, a first guess might be 4.5 million or so. (Existing home sales in Jan 2009 were 4.49 million SAAR).
4) With July inventory of about 4 million units and sales of 4.5 million units (SAAR), the months-of-supply will be just under 11 months and that will put downward pressure on prices.
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Pending Home fall to record series low in June
and
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Personal Income, Spending flat in June
http://www.calculatedriskblog.com/2010/08/personal-income-spending-flat-in-june.html
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