Pending home sales up for 5th straight month

[propertymanager]

I don't believe for a minute that this thing is over.  Quite the contrary, I think that we're just now on the bear market rally that is sucking in all the weak hands - only to take all their money in the relatively near future.  The only thing that the government has done by wasting TRILLIONS OF DOLLARS is to create a Government bubble, which will probably be the final bubble.

Let's face it, there is no real improvement in the economy - all that's occurred is that the government has pumped trillions of dollars into the economy in the place of the consumer that is tapped out!  The government is enticing people that have no business buying a house with the $8,000 credit, into buying a house!  The government is enticing people who have a paid-off "clunker" into taking on more debt, with a new car they can't afford.  All the while, the government is borrowing or simply printing the money to do these things.  Now, the government wants to greatly increase taxes via a cap and trade system to fix an imaginary global warming issue.  In addition, the socialists want to pass a big government universal health care plan to add to their major accomplishments with Medicare (which is BROKE) and Social Security (which is nearly broke).

The bottom line is that this country is BROKE.  Our status as the world's ecomonic power is OVER!  We've lived through the best days of this country and it will be down hill from here.  All great civilizations go through this process and it's our turn on the down hill side of the mountain!

Anyone that thinks that increasing taxes in every imaginable way and building a huge socialist society is going to stimulate our economy is delusional.  In my opinion, we're in for the mother of all double dips, which will be a double blow to those people who will have lost their money twice in the stock market.

I think that those that have a supply of extra food, water, and ammunition will be rewarded in the near future.  The government has spent MILLIONS of dollars to get people prepared and doing so is not gloom and doom or acting panicky.  I am conducting business as usual, but am also preparing for whatever is ahead (swine flu pandemic, civil unrest, economic collapse - whatever comes).  That's the smart play.

Mike

[Hoosier4life2005]

100% agreed.  This is how I feel.

I don't believe for a minute that this thing is over.  Quite the contrary, I think that we're just now on the bear market rally that is sucking in all the weak hands - only to take all their money in the relatively near future.  The only thing that the government has done by wasting TRILLIONS OF DOLLARS is to create a Government bubble, which will probably be the final bubble.

Let's face it, there is no real improvement in the economy - all that's occurred is that the government has pumped trillions of dollars into the economy in the place of the consumer that is tapped out!  The government is enticing people that have no business buying a house with the $8,000 credit, into buying a house!  The government is enticing people who have a paid-off "clunker" into taking on more debt, with a new car they can't afford.  All the while, the government is borrowing or simply printing the money to do these things.  Now, the government wants to greatly increase taxes via a cap and trade system to fix an imaginary global warming issue.  In addition, the socialists want to pass a big government universal health care plan to add to their major accomplishments with Medicare (which is BROKE) and Social Security (which is nearly broke).

The bottom line is that this country is BROKE.  Our status as the world's ecomonic power is OVER!  We've lived through the best days of this country and it will be down hill from here.  All great civilizations go through this process and it's our turn on the down hill side of the mountain!

Anyone that thinks that increasing taxes in every imaginable way and building a huge socialist society is going to stimulate our economy is delusional.  In my opinion, we're in for the mother of all double dips, which will be a double blow to those people who will have lost their money twice in the stock market.

I think that those that have a supply of extra food, water, and ammunition will be rewarded in the near future.  The government has spent MILLIONS of dollars to get people prepared and doing so is not gloom and doom or acting panicky.  I am conducting business as usual, but am also preparing for whatever is ahead (swine flu pandemic, civil unrest, economic collapse - whatever comes).  That's the smart play.

Mike

[fdjake]

Are we talking about the STOCK MARKET or the REAL ESTATE market???

If we're talking about STOCKS.....I agree....We probably WILL see a pull back at some point but I think the March lows will hold.  The FEAR of GLOBAL economic collapse is gone....Credit markets are functioning again (although at a slower more HEALTHY pace)

As far as the REAL ESTATE market goes????

Show me how that COLLAPSES from current BASEMENT pricing levels??
If you purchase a home now at these price levels and the market DOES fall further , it ain't falling MUCH further.  FLIPPING houses is GONE unless you have 100% CASH to finance your deals.  So those LOSERS are out of the market.  The only people BUYING homes NOW are LIVING in THEM LONG TERM or are paying CASH for them and have the economic staying power to ride out any further economic issues.

The bottom is IN for Residential Real Estate.  Commercial may have more downside....But not many average Americans are affected by this segment of the market.  These rae DEEP POCKET players OR they are future BANKRUPTED, FORMER deep pocket players. 

[christopher w]

Stanfield,

I'm sorry you are mistaken.

Actually, that changed  few weeks ago.

You can use the 8 k for downpayment.
 

The 8K can be used towards closing costs if you can find a short term lender that will loan it to you, but the borrower still has to come up with the down payment.

[Hoosier4life2005]

Hopefully Chris and FDjake are right.  I got a gut feeling the pain isnt over in home prices, but we'll see.  Trust me, nothing would make me happier than for home prices to stabalize.

[PositiveOutlook]

I don't see how the government pumping borrowed money into the economy creates long-term growth...  It creates a circular cycle, like a PONZI scheme...  It will have a short-term affect, no doubt, but it did NOT have the effect they were telling us it would...

Think about it, 90%+ of their forecasts have been WRONG on this whole thing...  and I am NOT sold that they saved us from a collapse...  the "stimulus" has only paid out anywhere from 7-10% of the money, so to buy that argument, it would rely on the TARP money, and the TRILLIONS borrowed and pumped in by the Fed...  Unfortunately, the dollar is struggling because of this...  the "toxic assets" are STILL on the books, the credit market is STILL pretty much frozen a YEAR later (light easing, but not beneficial to the majority of Americans), the government has BORROWED TRILLIONS and LOST BILLIONS from ineptitude and just being plain WRONG, fraud is popping up all over the place, and this all BEFORE Cap and Tax (trade) and nationalized healthcare AND the impending TAX INCREASE ON EVERYBODY...

From the Wall Street Journal back in February 2009 - "A tax policy that confiscated 100% of the taxable income of everyone in America earning over $500,000 in 2006 would only have given Congress an extra $1.3 trillion in revenue. That's less than half the 2006 federal budget of $2.7 trillion and looks tiny compared to the more than $4 trillion Congress will spend in fiscal 2010. Even taking every taxable "dime" of everyone earning more than $75,000 in 2006 would have barely yielded enough to cover that $4 trillion."


The spending that has occurred has resulted in PERMANENTLY HIGHER SPENDING to pay it...

The CBO said as much when the Dem's were trying to pass all this... that it would better if the government did nothing...

I think in retrospect, time will show the government actions made things worse not better...

In fact, if you think about it, this is just one big payday loan...  they'll just keep pushing it off, and we'll keep paying more and more and more...     

I pray for everyone's sake, that things will get better, but with all this additional spending and uncertainty hanging over our heads, it's become difficult to see it...

[propertymanager]

Show me how that COLLAPSES from current BASEMENT pricing levels??

Very simple.  Anytime there is excess in one direction (a bubble), there will be excess in the other direction (the bust).  House prices won't just come back to the base line, they should go significantly to the negative side of the graph before finally getting back.

From a fundamental standpoint - we are losing jobs; income is going down; our national debt is going up; taxes ARE going up for EVERYONE (including the Bush tax cuts expiring); and that doesn't even consider Cap and Trade (which will raise EVERYONE's energy bills); and socialized healthcare which will also cost taxpayers a bundle.  In other words, our standard of living is going DOWN in the future (Obama has said as much) and that's not good for home prices.

Mike

[christopher w]

I think we will see an uptick in prices at the end of the year as buyers flood the market trying to take advantage of the 8K. Keep in mind it goes away after November 30th so buyers that have waited and waited are going to go "holy cow if I don't go out get a house I am going to lose the 8K" which means sellers will most likely have multiple offers allowing them to most likely get close to full asking price if not more. This will artificially push up prices for the last quarter of the year, but then prices will settle again.

[sellnbama]

Christopher,
I agree with you on this except for the increase in price.You being in finance and investing,with knowing the rate of spending the past few months.What/when do you speculate a critical rate change?Just curious.   

[christopher w]

Bama,

I think rates will stay low through the end of the year. As for the uptick in prices my reasoning for this is that all of the fence sitters are going to rush out to buy a house before the credit expires which will create a 45-60 sellers market from mid-october through november 30th. So when the NAR releases their data in the first quarter next year they will declare the housing market back because house prices increased. Although they will drop back down in December and January when rates go up and tax credit has gone by-by.

[sellnbama]

CHristopher,
Thanks,for the insight.I just can't understand if a tax cut is working,why not keep it going until things REALLY stabilize.I guess if it makes simple sense,then it's too complicated for govt.