Saturday, May 28, 2016

The Surge in New Home Sales Is Erroneously Seen as a Stronger Economy

In April, new home sales surged to the highest level since 2008.

Quickly, economists jumped on that fact as a sign that the economy is getting stronger.  Well, maybe.

However, it can also mean that all the talk of interest rate hikes by the Federal Reserve is causing people to get off the proverbial fence and buy at the current lower rates.  It could also be a result of Obama pushing home sales with dangerously low down-payment rates of just 3% from a norm of 20%. If the latter is true, with increasing home sales, we could be seeing the start of another housing bubble crisis which previously resulted in the Great Recession.


New-Home Sales Surge to Post-Recession High:

Why higher interest rates could actually be good for the housing market: 

3% down payments lure first-time homebuyers - USA Today:

President Obama Explains How FHA's 3%-Down Mortgages Are Great for America:

Obama 3% Down Plan Setting Up Next Mortgage Meltdown:


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