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Existing Home Sales Down 27% In July

So much for Biden's recovery summer--sales of existing homes have dropped 27%.

Sales of U.S. previously owned homes plunged 27 percent in July, twice as much as forecast, evidence foreclosures and limited job growth are depressing the market.
This is apparently twice what economists predicted. Dare I say that the degree of the decline was unexpected? Of course the reason for the decline is not a mystery.
A tax credit of up to $8,000 boosted sales earlier in the year, pulling forward demand and indicating additional advances will prove difficult. Mortgage rates at record lows have provided scant relief to the industry as unemployment hovers close to 10 percent, foreclosures hold near record-highs and the economy cools.
The tax credit was yet another example of borrowing from the future to bailout the present. That works great for the present until of course we all reach that future. The future is now.

A collection of more thoughts on the announcement at Instapundit.


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Comments (28)

Now that's what I call "cha... (Below threshold)
LeBron Steinman:

Now that's what I call "change"!!

Yep, Obamanomics is doing a... (Below threshold)
GarandFan:

Yep, Obamanomics is doing absolute WONDERS for the economy.

The trouble with Socialism ... (Below threshold)
Eric:

The trouble with Socialism is that eventually you run out of other people's money.

- Margaret Thatcher

The only way the Obama admi... (Below threshold)
Caesar Augustus:

The only way the Obama administration could destroy the middle classes more quickly and completely is if they literally started carpet bombing the nation's suburbs.

Gee, I wonder who Obama wil... (Below threshold)
iwogisdead:

Gee, I wonder who Obama will blame for this.

Glad to hear conservatives ... (Below threshold)
Dane:

Glad to hear conservatives come out against tax credits. It makes the "hypocrite" handle so much easier to place.

And the fact that sales dropped when the tax credits ended shows... that the tax credit had a positive effect on home sales. Had we not had the credit the recession would have ben a lot worse.

I realize all of these points require "thinking" instead of "reacting" in "anger" but I thought I'd put them out there for the thinkers in the crowd - ie the other liberals.

The rest of you clowns can just do the usual - click the red minus button - spew some nonsensical vitriol, and go look for the latest Wizbang post on gays/blacks/Muslims.

Rinse, repeat

Posted by Caesar Augustus ... (Below threshold)
tomg51:

Posted by Caesar Augustus |
"The only way the Obama administration could destroy the middle classes more quickly and completely is...."


to replace Geithner with Krugman

Dane:And... (Below threshold)
_Mike_:

Dane:

And the fact that sales dropped when the tax credits ended shows... that the tax credit had a positive effect on home sales

Attempt reading the following again. This time try to comprehend what you read.

A tax credit of up to $8,000 boosted sales earlier in the year, pulling forward demand

"Pulling forward demand" is the term that you should attempt to understand. It's not the same as increasing demand.

6. Posted by Dane | August ... (Below threshold)
tomg51:

6. Posted by Dane | August 24, 2010 1:01 PM
"Had we not had the credit the recession would have ben a lot worse."

..would have been a lot more equitable and shorter.

"And the fact that sales dr... (Below threshold)
Hank:

"And the fact that sales dropped when the tax credits ended shows... that the tax credit had a positive effect on home sales. Had we not had the credit the recession would have ben a lot worse."

Glad to see you agree that lower taxes are beneficial to economic growth.

Other than that, do you practice being an asshole or does it just come naturally?

'I realize all of these poi... (Below threshold)
DaveD:

'I realize all of these points require "thinking" instead of "reacting" in "anger" but I thought I'd put them out there for the thinkers in the crowd - ie the other liberals.'

Dane, you flatter yourself. But I also understand given the current effect of the liberal agenda on our economy, talking to yourself is likely the only means of validating your self-esteem at the moment.

Let me ask you this? Having seen the temporary effect of the temporary tax credit on the housing market, where do you stand on the coming elimination of the Bush tax cuts?

Wait...In a democrat... (Below threshold)
BluesHarper:

Wait...
In a democrats head the homes sales have improved. They expected a 40% drop and it only dropped 27% - so that's a 13% savings. (Of course I made those numbers up.)

Holy Crap!! I'm catching on to this liberal way of thinking.

Excuse me. I have to go milk a unicorn for its Skittles.

Just kidding of course. (You have to say that in case there is a liberal reading this.)

Dane, the tax credit was pa... (Below threshold)
John:

Dane, the tax credit was paid for how? It was paid for by tax payers, mavy of the same people who's home's values have crashed wow a double whammy, I get to lose value and subsitize someone else buying a new home. It's another case of applying tax payer dollars for the benefit of a specific group do you think that's fair? After all people who can afford a house, even with a tax credit are generally not poor and needy are they?

Hey Dane, why not just shov... (Below threshold)
GarandFan:

Hey Dane, why not just shove your head back up your anal orifice and spare us the drivel. Next you'll be touting how "Cash for Clunkers" totally revived the auto industry. They're going great guns, aren't they?

Face it pal, you've invested in a loser. Get over it.

A perfect example of the wr... (Below threshold)
Dane:

A perfect example of the wrong-headed right thinking that most of us choose to ignore.

"Dane, the tax credit was paid for how? It was paid for by tax payers, mavy of the same people who's home's values have crashed wow a double whammy, I get to lose value and subsitize someone else buying a new home. "

How many tax dollars came out of your pocket to fund this subsidy?

How many thousands of dollars further would your home value have dropped were it not for the bolstering effect of the subsidy?

You came out way ahead on your investment of a few tax dollars spent on this subsidy.

Renters saw their tax dollars bolster your home value - and all you can do is whine because Fox News told you to.

Morons... when did all of the crap slide down hill into the Republican party? All you've got left is people like Sarah Palin. Idiots with big mouths who can't think their way out of paper bags.

Dane:You... (Below threshold)
_Mike_:

Dane:

You came out way ahead on your investment of a few tax dollars spent on this subsidy.

Unsupported bullshit.

Idiots with big mouths who can't think their way out of paper bags.

Pot meet kettle.

Dane,Someone has t... (Below threshold)
SER:

Dane,

Someone has to do the "Fisking," so it might as well be me...

How many tax dollars came out of your pocket to fund this subsidy?

I think my share of the national debt went up. Is that what you mean?

How many thousands of dollars further would your home value have dropped were it not for the bolstering effect of the subsidy?

I live in Texas, I don't think there has been a significant drop. However, if there were no subsidy, the market would be where it is now. Therefore, I believe that there was no effect - unless I had desired to sell the Mansion in April.

You came out way ahead on your investment of a few tax dollars spent on this subsidy.

How so? Still in the same place, but my share of the national debt has grown.

Renters saw their tax dollars bolster your home value - and all you can do is whine because Fox News told you to.

Don't know how that is true. I'll thank the tenants I have, if you think that is appropriate. I am not subsidized by taxpayers, if that is your allusion - I do not have a mortgage.

Morons... when did all of the crap slide down hill into the Republican party? All you've got left is people like Sarah Palin. Idiots with big mouths who can't think their way out of paper bags.

I guess this is when the typical liberal runs out of logic and turns to ad hominem arguments.

Hey Dane, tell us how well ... (Below threshold)
GarandFan:

Hey Dane, tell us how well "Recovery Summer" is going. And how the numbers of new unemployment applications are dropping!

Tell us all the wonders of Obamanomics.

Of coure, you guys watch Fo... (Below threshold)
Dane:

Of coure, you guys watch Fox News. Of course you don't know what's really going on.

The massive stimulus package boosted real GDP by up to 4.5 percent in the second quarter of 2010 and put up to 3.3 million people to work, the nonpartisan Congressional Budget Office said on Tuesday.

www.reuters.com/article/idUSTRE67N55X20100824

It raised employment by between 1.4 million and 3.3 million jobs during the second quarter of this year, CBO estimated.

Measured another way, CBO said the stimulus increased the number of full-time equivalent jobs by up to 4.8 million, as part-time workers shifted to full-time work or employers offered more overtime work.


Dane in the ass-<i... (Below threshold)
Nine Fourteen:

Dane in the ass-


"I realize all of these points require "thinking" instead of "reacting" in "anger" but I thought I'd put them out there for the thinkers in the crowd - ie the other liberals.

The rest of you clowns can just do the usual - click the red minus button - spew some nonsensical vitriol, and go look for the latest Wizbang post on gays/blacks/Muslims"


I think its safe to say we've found a carbon copy of Rev Lee Ward of the state. Not that we wanted one.


A democracy cannot exist... (Below threshold)
Deke:

A democracy cannot exist as a permanent form of government. It can only exist until the voters discover that they can vote themselves largesse from the public treasury. From that moment on, the majority always votes for the candidates promising the most benefits from the public treasury with the result that a democracy always collapses over loose fiscal policy, always followed by a dictatorship. The average age of the world's greatest civilizations has been 200 years.
Great nations rise and fall. The people go from bondage to spiritual truth, to great courage, from courage to liberty, from liberty to abundance, from abundance to selfishness, from selfishness to complacency, from complacency to apathy, from apathy to dependence, from dependence back again to bondage.

Several authors have been given credit for this quote but none proven. Everytime I hear someone like Dane, a politicain, lawyer, or other parasite on our Republic, I always turn to this and shake my head.

Every move made by either political party is all about the here and now and what it takes to get re-elected. Dane points out the housing market had a temporary save due to this program and then it was rightly pointed out to him that it was at the cost of our future generations.

Our founders understood that a Deomocratic Republic could not stand if people had no interest in the long term health of the nation, thus they attempted to qualify the right to vote. Of course this idea has become an anathema to our way of thinking and the "right" to vote for anyone, regardless of responsiblity, has become the norm.

Is electing Republicans really the answer? Or is a complete overhaul of the system the only saving grace?

Dane,"The massive ... (Below threshold)
SER:

Dane,

"The massive stimulus package boosted real GDP by up to 4.5 percent in the second quarter of 2010 and put up to 3.3 million people to work, the nonpartisan Congressional Budget Office said on Tuesday."

Then why aren't the Democrats in congress running on their votes for the Stimulus? Is it because they don't need to since we are in the middle of "Recovery Summer?"

Just think, if we borrow more money and spend it the same way as the stimulus, we can put everyone in the U.S. back to work.

Finally, Mr. Dane, Democrats hate employers (also known as "the Rich," "Fat Cats," etc). When the Government hates employers, don't be surprised if you don't get many employees.

Here Dane. More good econo... (Below threshold)
GarandFan:

Here Dane. More good economic news to balance Al-Reuters, aka the DNC Echo Chamber.

http://www.ft.com/cms/s/0/85b58588-af4e-11df-a172-00144feabdc0.html

Buy a house.or the... (Below threshold)
LiberalNitemare:

Buy a house.

or the terrorists win!

Drudge headlines... 11 PM <... (Below threshold)
JLawson:

Drudge headlines... 11 PM

BIDEN: 'We're moving in right direction'...
Worries about recovery deepen...
'Hindenburg Omen' creator exits stock market...
Economy in 'Depression, Not Recession'...
Dow Faces 'Bouncy Ride to 5,000'...
Typical Slow Summer -- or Something Darker?
Drop in Home Sales Renews Pricing Fears...
Investors Scatter to Safety...

But they're moving in the right direction. Kind of makes you wonder what they consider the 'right' direction, doesn't it? Things keep getting worse, but we're going in the 'right' direction?

They got some destination in mind that's at the end of this 'right direction' that we'd prefer to avoid, perhaps?

Dane where in the name of g... (Below threshold)
John:

Dane where in the name of god do you think tax credits hit, liberals are so fond of calling lower tax rates a COST how is this any different. Do you think that the government creates money from nothing? You're an absolute idiot if you think that tax credits are funded anywhere but from tax payers(now only about 50% of country.) I would much rather this housing situation had run it's course and been done with, this non sense of tempoary stimulus with the resulting dive in home sales is just putting it off. The govenment needs to stop trying to fix crap it has no idea how to fix. Every time these morons in congress try to address a problem it gets worse not better, so please take the rest of the year off then quit for the good of the nation.

Oh and Dane to your last po... (Below threshold)
John:

Oh and Dane to your last point.... YOU ARE A BIG FAT POOPY HEAD, thanks for playing name calling.

"Had we not had the c... (Below threshold)
John S:

"Had we not had the credit the recession would have been a lot worse..."

Absolute bullshit. Look at a chart of existing home sales. Start at the 2005 peak and draw a straight line to yesterday's miserable number. The decline in 2006 - 2007 follows that line exactly. Obama merely bought us a one year bubble in sales and today we're exactly where we would have been if we had done nothing. The cost of Obama's mini housing bubble? Another quarter trillion of debt and an extra 10 million foreclosures in coming years.




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