June 25, 2010 – Bring on the Housing Double Dip


3) Bring on the Housing Double Dip. This is another 'I told you so' piece, so if that sort of thing annoys you, skip on. Yesterday's 300,000 figure for new home sales was absolutely diabolical, 26.8% lower than the 410,000 that was expected and the worst since 1963. This is down a flabbergasting 78% from the 2005 peak. Any doubt that housing was going into a double dip has been cast into the wind. The end of the first time homebuyer's tax credit is to blame. No surprise that people refrain from buying homes without a gigantic bribe attached. This calls into question the viability of the economy once the other stimuli were off. It will hasten calls for not only a reinstatement of the credit, but an entire new stimulus package as well. For more detail on the structural arguments on why this was certain to happen, please read 'the Hard Truth About Residential real Estate' by clicking here. Rent, don't own.