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Tuesday, August 4, 2009

Home Sales Up for Fifth Consecutive Month: But is it Sustainable? The Answer: NO!

Uptrend Continues in Pending Home Sales
Pending home sales are up for the fifth consecutive month, the first time in six years for such a streak, according to the National Association of Realtors®.

The Pending Home Sales Index,1 a forward-looking indicator based on contracts signed in June, rose 3.6 percent to 94.6 from an upwardly revised reading of 91.3 in May, and is 6.7 percent above June 2008 when it was 88.7. The last time there were five consecutive monthly gains was in July 2003.

Lawrence Yun, NAR chief economist, said a combination of positive market factors is fueling the gains. “Historically low mortgage interest rates, affordable home prices and large selection are encouraging buyers who’ve been on the sidelines. Activity has been consistently much stronger for lower priced homes,” he said. “Because it may take as long as two months to close on a home after signing a contract, first-time buyers must act fairly soon to take advantage of the $8,000 tax credit because they must close on the sale by November 30.”

*so let's see. Home sale contracts are not closings and I hear all the time that buyers are having trouble getting a mortgage so the deal collapses. And today Japan and the US reported that WAGES are decreasing.
So let's see, home sales are up, but only on LOWER priced homes, and who could afford the upper end? No one apparently, or at least LESS and LESS. So the Recession is over, but I still ain't got a job and if I do I am getting a furlough or less income which relates to LESS tax revenue which relates to MORE job layoffs, which relates to declining home sales and prices, which relates to more credit card defaults, which relates to no spending, which relates to corporate defaults, which relates to MORE government spending, which relates to the World is BANKRUPT.

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