Is Real Estate’s ‘Irene’ in the Rearview Mirror or Ahead: July’s Pending Home Sale Numbers

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The news wasn’t all bad… however whenever someone starts a sentence like that,
you know the news isn’t very good either, so I’ll keep this brief: Pending home
sales numbers as reported by the National Association of Realtors for the month
of July were not good.  Typically July is a good month for sales – not the best by any means, but not the worst either which is August – but the numbers declined from June and that creates a somewhat ominous outlook for the fall.

There is little doubt that we can thank our Congress for July’s poor showing.  The
failure of Congress and in particular the centrists to come together on the
debt ceiling, and allowing the idiots on the two extremes to bring our nation
to its knees, is the primary reason we saw a decline in July.  The damage to the
American psyche is difficult to quantify but this much we know, the fear and
anxiety they’ve created will not go away easily.  As a result and in combination with the general malaise of the economy and the predictably weak numbers of the afore mentioned
slow month of August, we in real estate will have little choice but to brace ourselves and our sellers for our own hurricane Irene.

I did however say the news wasn’t all bad didn’t I?  So here is the good news: while the month over month numbers (June to July) were down 1.3%, economists had predicted a 1.3% decline, so there was no surprise here.  More significantly was the fact that year over year numbers rocketed higher by 14.4%.  By any measure, a 14.4% year over year increase is massive.  Remember, the year over year numbers we have had until now, were impacted by artificially inflated sales figures that were the result of the Federal Housing Tax Credit.  Most economists and Realtors alike had predicted that for a sustained period the year over comparison was going to look bad since so many buyers rushed in to the housing market in late spring 2010, many accelerating their schedule to take advantage of the tax credit before it expired.  As a result I’d like to suggest that this July over July figure shows just how far the housing market has improved.  So there really is some
good news here…

Now if Congress can just do something to give a little confidence back to the
American people, maybe, just maybe, the storm clouds will instead give way to
those with a silver lining.

 

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