The Real Estate Weblog

While it may be good for buyers that Home prices have fallen by some twenty percent from their mid-2006 highs, these same prices also mean that more people simply cannot refinance their mortgages, which is one of the factors that is causing foreclosures to sharply increase. This may then cause prices to fall further. This is a vicious cycle in the new-home market. New homes in the United States have declined 67% since the peak in July of 2005.
It seems quite amazing that in 26 years, the United States real estate market has not seen this type of steep decline in the permitting and building of new houses. In addition, these declines in the construction industry will continue to harm the nation’s overall economy, unfortunately.
If you are looking at the real estate market since 2007, the median price of a new house decreased 9.1% from last year, to $218,400. All in all, this is the lowest since 2004.
More details may be found at Merlins News and Editorials Furthermore, overall sales were down by about one third percent from September of last year.
It appeas that Shrinking inventories of surplus homes should help stabilize prices according to the chief U.S. economist at Deutsche Bank Securities Inc. in New York. It appears that there will be a further decrease in house sales in the near future, because of the country’s toupher financial conditions and substantially reduced economic growth prospects.
All in all, it appears that the largest housing recession in a whole generation was showing signs of reaching a basement in sales, when financial markets began to implode in September. The government takeover of mortgage finance companies Freddie Mac and Fannie Mae and a $700 billion rescue plan of course followed.