US Existing Home Sales in July crashed 27.2% since June. Apparently, consumers are conditioned to buy things when they are receiving a “credit” as opposed to when the same exact item is the same price as or less than the item with the credit. Looks like we may have a moral hazard on our hands.
Mortgage rates are at historical lows. Housing prices continue to drop in search of offers. As the high season for home sales soon comes to an end, another tax credit may be the only way those with jobs can get excited about playing Let’s Make a Deal in the housing market.