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April 24, 2007



Never trust press releases (without checking backgrounds). The US Census bureau reports two years when median prices dropped for median new home sales: 1970, 1991. Those are not inflation adjusted pricing. See http://www.census.gov/const/uspriceann.pdf

If you consider mean, rather than median, they also dropped in 1992.

Current problems still don't reach the magnitude of problems during the S&L crisis, although they are growing.


That's the comment from the Realtor's trade group. Let's hope the decline is only 1-3% because with sales cratering and inventory skyrocketing, it could get very ugly for homeowners, especially those in formerly hot markets in California, Phoenix, South Florida, Vegas, etc.


I enjoyed the first sentence: "Sales of existing homes plunged in March by the largest amount in nearly two decades, reflecting bad weather and increasing problems in the subprime mortgage market, a real estate trade group reported today"

Or later on: "David Lereah, chief economist at the Realtors, attributed the big drop in part to bad weather in February, which discouraged shoppers..."

Notice the point where they put bad weather in there? Anything to distract from the message of BUY! BUY! BUY!

This article is a brilliant marketing/PR puff piece for realtors.

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