Home Sales Up but Jobs are Down
Wednesday, November 4, 2009
It’s a no brainer that housing and jobs are interrelated. Fix housing and jobs will follow in service sectors and and the manufacturing of products we need at home.
I believe only one thing is going to get our economy moving again..Housing. We got here because Real Estate based derivatives failed to produce gains. Right? No money, no growth and no jobs.
The Pending Home Sales Index, a forward-looking indicator based on contracts signed in September 2009, rose 6.1% to 110.1 from a reading of 103.8 in August, and is 21.2% higher than September 2008 when it stood at 90.9. The gain from a year ago is the largest annual increase on record, and the index is at the highest level since December 2006 when it was 112.8.
We got here because Real Estate based derivatives failed to produce gains. Well, then why doesn’t the government focus more on housing strategies? Obviously, it has been very effective!
This quote proves my point…
Lawrence Yun, NAR chief economist, said the momentum is understandable. “What we’re witnessing is a rush of first-time buyers trying to beat the expiration of the tax credit at the end of this month,” he said. “Home values will stabilize sooner rather than over-correcting. That, in turn, will mean wealth stabilization for the vast number of middle-class families and lay the foundation for a durable economic recovery.”
What if the Obama administration created another tax benefit for ALL buyers? Better yet, produce better guidelines that all banks must use to implement procedures that fast track short sales. Oh, Oh, Oh I know! LOAN MODS!!!!! What happened to all the promises there? Fix Housing-Fix America!
Even renters could see a benefit. Consider an apartment owner who would not feel the need to raise rents to their max if he could only get a small loan mod. Do you think you would be a ‘consumer’ again if you could get a loan mod? I bet your answer is ” YEP”! That new TV or new Dining Room table would become affordable for you and that only creates more jobs! Right?
So many sectors of the economy are dependent on housing that it is a big ‘no brainer’ that housing should be the focus.
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