The Housing Market in the U.S. is in Trouble.
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by: Stebee
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Word Count: 297
Experts agree that if the government does not bailout certain players within the financial industry by passing the $700 billion bailout plan, the already bleak looking housing market will only get worse. The numbers of people facing property repossession has risen a whopping 93% in July since just last year. Compared to 2006 when the home prices were at their peak, the average price of a U.S.home has fallen by around 20%. .
In the upcoming year, it is predicted to fall around about 10% more. Currently, the market has over a 10 month supply of homes in it. Existing home sales in the month of August had fallen 11%, and the new home sales plummeted around 35%. The construction industry is also suffering from the current problems. Many are finding it hard to stay in business. Because of credit problems, they are pressing for the bailout to be passed quickly. A number of them have not been able to access credit in order to continue operating.
A great deal of potential home buyers are having a difficult time getting a mortgage loan. Many lenders will now only extend credit to people with a perfect credit history. The only positive thing about this entire crisis is the fact that many people can now afford to purchase a home due to fact that the rate on a 30 year, fixed rate mortgage has now dropped to 6.12%.
Home builders are attempting to entice new home buyers by offering huge discounts of up to 20%. They are also offering many luxury items, such as, in-ground swimming pools, granite counter tops, and top of the line appliances. The National Association of Home Builders announced that such incentives are being offered by 56% of builders.
About the Author
Even though the housing market is now facing one of the worst dilemmas in history, it is important to remain optimistic that the economy will regain its composure in the coming years. House prices are now coming down to an affordable rate. The only problem is that because (literally) thousands has been wiped of the vale of homes, people are in no hurry to sell property fast.
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