Home sales drop in dec. biggest drop in 40 yrs.

[Danno 1,228]

December home sales down nearly 17 percent

Home sales plunge nearly 17 percent in December after tax credit deadline extended

Companies:Bank Of America CorporationCitigroup, Inc.Fannie Mae

By Alan Zibel, AP Real Estate Writer , On Monday January 25, 2010, 12:32 pm EST

WASHINGTON (AP) -- Sales of previously occupied homes took the largest monthly drop in more than 40 years last month, sinking more dramatically than expected after lawmakers gave buyers additional time to use a tax credit.

The report reflects a sharp drop in demand after buyers stopped scrambling to qualify for a tax credit of up to $8,000 for first-time homeowners. It had been due to expire on Nov. 30. But Congress extended the deadline until April 30 and expanded it with a new $6,500 credit for existing homeowners who move.

"It's 'exit stage left' for first-time homebuyers," wrote Guy LeBas, an analyst with Janney Montgomery Scott.

December's sales fell 16.7 percent to a seasonally adjusted annual rate of 5.45 million, from an unchanged pace of 6.54 million in November, the National Association of Realtors said Monday. Sales had been expected to fall by about 10 percent, according to economists surveyed by Thomson Reuters.

The report "places a large question mark over whether the recovery can be sustained when the extended tax credit expires," wrote Paul Dales, U.S. economist with Capital Economics.

The median sales price was $178,300, up 1.5 percent from a year earlier and the first yearly gain since August 2007. However, some of that increase could be due to a drop-off in purchases from first-time buyers who tend to buy less expensive homes.

Sales are now up 21 percent from the bottom a year ago, but down 25 percent from the peak more than four years ago.

The big question hanging over the housing market this spring is whether a tentative recovery will stumble after the government pulls back support. The Federal Reserve's $1.25 trillion program to push down mortgage rates is scheduled to expire at the end of March -- a month before the newly extended tax credit runs out.

Last year, first-time buyers were the main driver of the housing market, but their presence is on the decline. They accounted for 43 percent of purchases in December, down from about half in November, the Realtors group said.

The inventory of unsold homes on the market fell about 7 percent to 3.3 million. That's a 7.2 month supply at the current sales pace, close to a healthy level of about 6 months.

Total sales for 2009 closed out the year at 5.16 million, up about 5 percent from a year earlier. That was the first annual sales gain since 2005. But prices fell dramatically last year, declining 12.4 percent to a median of $173,500, the largest decline since the Great Depression.

Though the results missed Wall Street's expectations, the Realtors' group says there are signs the market is finally stabilizing.

"There is some sustainable momentum building in the housing market right now," said Lawrence Yun, the group's chief economist. However, he cautioned that the recovery will depend on whether the economy starts adding jobs in the second half of the year.

Many experts project home prices, which started to rise last summer, will fall again over the winter. That's because foreclosures make up a larger proportion of sales during the winter months, when fewer sellers choose to put their homes on the market.

Despite fears that home prices are starting to fall again, some analysts still believe the worst is over.

"We do not believe it is fair to consider this a double dip in the housing market," Michelle Meyer, an economist with Barclays Capital, wrote last week. "The recovery is still under way, but hitting some bumps in the road."

http://finance.yahoo.com/news/December-hom...ml?x=0&.v=6

[spookyturtle 9,466]

Probably the remnants of the Bush Administration destruction of the economy.

[lostinblue 1,989]

REALTYTRAC® YEAR-END REPORT SHOWS RECORD 2.8 MILLION U.S. PROPERTIES WITH FORECLOSURE FILINGS IN 2009

http://www.realtytrac.com/contentmanagemen...amp;itemid=8333

Despite all the delays, foreclosure activity still hit a record high for our report in 2009, capped off by a substantial increase in December,” Saccacio continued. “In the long term a massive supply of delinquent loans continues to loom over the housing market, and many of those delinquencies will end up in the foreclosure process in 2010 and beyond as lenders gradually work their way through the backlog.”

Until the government lets the housing market hit bottom like it should .You just will not see a big jump in this sector of the economy.

[Danno 1,228]

Anyone using this as a "buying time?.

Or waiting for this market to go lower?

[Pinocchio Liberal 268]

Just waitin for the 8000.00 dolla subsidy to go away! Then your gonna see a crash!

[scandal 951]

Anyone using this as a "buying time?.

Or waiting for this market to go lower?

I bought my house in Feb 2009. No complaints.

It's nearly impossible to time a top or bottom to a market, or to interest rates.

Buy when it's the right personal decision to do so. Buy because you intend to live in the home for long enough that you're not really paying attention to the market gyrations. Otherwise, don't buy.

[Dan J 277]

Just waitin for the 8000.00 dolla subsidy to go away! Then your gonna see a crash!

Probably not as bad as you might expect. You do need good credit to qualify now days. Gone are the days of zero percent down, and no verification mortgages.

I think the credit did more than anything, push those over who were on the fence between buying and renting.

I bought my house in Feb 2009. No complaints.

It's nearly impossible to time a top or bottom to a market, or to interest rates.

Buy when it's the right personal decision to do so. Buy because you intend to live in the home for long enough that you're not really paying attention to the market gyrations. Otherwise, don't buy.

We just bought a condo at the end of October, between prices and interest rates, it just made sense.

[Pinocchio Liberal 268]

Probably not as bad as you might expect. You do need good credit to qualify now days. Gone are the days of zero percent down, and no verification mortgages.

8000.00 bucks is just a new way to screw ppl! Gets em in, but a layoff will ** them! The second Obama CRASH will be coming soon!

[웃 910]

Anyone using this as a "buying time?.

Or waiting for this market to go lower?

My dad picked up 5 houses between August 2008 and June 2009, all foreclosed and in the price range of $15,000-$33,000 including all repairs/remodeling. Had no problem renting each place out.

I followed into his footsteps and bought one up in October 2009. Bought the house for $10,500 including taxes. Place was a disaster but for another $10,000 got it fully remodeled from A-Z. Unfortunately, I haven't found a buyer yet. Supposedly this is the worst time of the year for selling in Michigan, and I should get more inquiries going into spring.

A Realtor I know (in his early 30s) picked up 10 houses over the last year. All in Pontiac, MI. All for a maximum including repairs of $12,000 a house. He said on the first of the month he collects $5,000 and hasn't had a problem with collecting payment thus far.

Edited January 26, 2010 by NOsamaCare

[christeen 966]

We want to buy, the problem is that since my husband recently got his GC and SS#, he has no credit yet and does not qualify under ANY program!!! We have the down payment, he makes enough $$ but we cannot get a loan... I guess it is no wonder the housing market is not recovering!!! It is hell to get a loan!! Even with 20 - 30% down!!!

[alienlovechild 75]

Probably not as bad as you might expect. You do need good credit to qualify now days. Gone are the days of zero percent down, and no verification mortgages.

I think the credit did more than anything, push those over who were on the fence between buying and renting.

The $8000 home buying credit was designed to stabilize the housing market and prevent a spiral of foreclosed homes drving down neighboring properties.

In its third form credit, its becoming a subsidy to keep home prices higher than allowing them to drop to true market levels because there simply aren't enough buyers with secure jobs to soak up the inventory let alone bank held properties in the looming foreclosures.

The fear of foreclosures has waxed as it has become the new norm and more people worry holding on to their jobs.

[Pinocchio Liberal 268]

We want to buy, the problem is that since my husband recently got his GC and SS#, he has no credit yet and does not qualify under ANY program!!! We have the down payment, he makes enough $$ but we cannot get a loan... I guess it is no wonder the housing market is not recovering!!! It is hell to get a loan!! Even with 20 - 30% down!!!

Fvckin shouldnt need any PROGRAM!

Edited January 26, 2010 by Col. Lingus

[웃 910]

We want to buy, the problem is that since my husband recently got his GC and SS#, he has no credit yet and does not qualify under ANY program!!! We have the down payment, he makes enough $ but we cannot get a loan... I guess it is no wonder the housing market is not recovering!!! It is hell to get a loan!! Even with 20 - 30% down!!!

My wife came to the states last January (2009) and had no credit either. I added her as an authorized user on one of my cards maybe sometime around early summer. She applied for a card about a month later and was denied. We realized the only way was to get a secured credit card which meant we had to pay money up front as collateral. We deposited $400 to Bank of America as collateral for her secured credit card with a $400 limit. This was August (2009). She has only had 4 months of history. I purposely kept her balance between $90 and $125 (22-32% of her max)...Anyways, about 5 days ago she got a pre-approved letter from Chase bank for their Sapphire card. She applied thinking she'd be denied for sure. Well, Sunday she called up to check the application status and the automated response said "congratulations, you've been approved...your credit limit is $5,000".

She has only had the 4 months of history so it is shocking to me. My first card had a $400 limit and my second a $1000 limit.

The surefire way to get some credit is going the secured credit card route. The minimum, at least with Bank of America, was $250 collateral. After 9 months they convert the card to an unsecured credit card and return the collateral...

Edited January 26, 2010 by NOsamaCare

[christeen 966]

Fvckin shouldnt need any PROGRAM!

ALL LOANS are backed by a PROGRAM (since banks sell to either Freddy, Fannie, VA or FHA)!!! If they will not back the loans then a bank will NOT give a loan... I did not mean a fvcking welfare program, we earn enough to pay, but without a credit score, no loan... The only exception to this are private mortgages (self funded) which requires a bank to finance the loan itself, and those banks are hard to come by!!!

[christeen 966]

My wife came to the states last January (2009) and had no credit either. I added her as an authorized user on one of my cards maybe sometime around early summer. She applied for a card about a month later and was denied. We realized the only way was to get a secured credit card which meant we had to pay money up front as collateral. We deposited $400 to Bank of America as collateral for her secured credit card with a $400 limit. This was August (2009). She has only had 4 months of history. I purposely kept her balance between $90 and $125 (22-32% of her max)...Anyways, about 5 days ago she got a pre-approved letter from Chase bank for their Sapphire card. She applied thinking she'd be denied for sure. Well, Sunday she called up to check the application status and the automated response said "congratulations, you've been approved...your credit limit is $5,000".

She has only had the 4 months of history so it is shocking to me. My first card had a $400 limit and my second a $1000 limit.

The surefire way to get some credit is going the secured credit card route. The minimum, at least with Bank of America, was $250 collateral. After 9 months they convert the card to an unsecured credit card and return the collateral...

Thanks, yes we opened 2 secured cards, one for $5,000 and one for $2,000 plus we are getting a "credit builder loan" for him, which is a $5,000 loan for 6 months that is put in a savings account and he makes monthly payments... Once repaid, we get the money back less the 3.5% interest... Sucks to pay them for nothin, but figure it will get him started....