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Realistbear

U S Uber- E A Admits Market Is In Trouble

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http://www.builderonline.com/industry-news...rticleID=325189

Home Sales Sink; Rates, Inventory Rise

Source: USA TODAY

Publication date: 2006-06-28

By Noelle Knox
Rising interest rates are making it increasingly hard to buy a home and are putting the brakes on the nation's most expensive housing markets.
The latest evidence came Tuesday from the National Association of Realtors, which said sales of existing homes fell 6% from January to May. The drop was worse for single-family homes, whose sales posted their
steepest drop in 11 years
. The number of homes for sale, meantime, rose sharply last month, a sign of slackening demand.
"The one thing that's changing my forecast is the Federal Reserve," said David Lereah, the NAR's chief economist, who said he now expects
home sales to fall as much as 8% this year
, instead of the 5% drop he projected in January. "The market is expecting several more interest rate hikes from the Fed, and that could harm some of our nation's cooling housing markets."
Rising rates are even more dangerous for people with adjustable-rate mortgages that will later reset to much higher rates. In San Diego, where the median home price is $607,000,
74% of buyers last year took out loans that let them pay only the interest or even less, according to LoanPerformance
.

Just think how many IO and other forms of creative financing has helped fuel the UK bubble. :o

Edited by Realistbear

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  • 301 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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