Home Prices

Real estate market condition

home prices

The just released Standard & Poor’s/Case-Shiller index showed home prices dropped in October from September in 19 of the 20 cities tracked! This marks the second month in a row that home prices fell in the majority of cities tracked in this report.

This report also showed that home prices in Atlanta, Las Vegas fell to their lowest points since the housing crisis began.

Home prices in many cities, including Cleveland, Detroit, Las Vegas, Phoenix and Tampa, have reached their lowest points since the housing bust began.

Real estate market condition:

Sales of previously occupied homes are barely ahead of 2008’s dismal figures — the worst in 13 years. And sales of new homes this year will likely be the worst since the government began keeping records a half century ago.

As an aside to this home price report, it’s not widely known that the just passed payroll tax cut extension (actually, mostly an increase in unemployment benefits) will have a direct impact on the real estate market.

Yes, the two-month extension of the so-called ‘payroll tax cuts’ is being paid for by a new tax on all new mortgage loans that go through Fannie Mae or Freddie Mac.  That’s about 90% of all mortgage loans will now have an added cost of approximately $17 per month for the next 10 years! I know, sounds unbelievable, but it’s true… Look it up for yourself! 10 years of the new mortgage tax to pay for a two-month extension of unemployment benefits! Does this sound equitable to you? Or perhaps I should phrase this another way: It just may be time to cut back the 99 weeks of unemployment benefits to a much more reasonable amount.

Home prices in 2012? Watch for our upcoming 2012 San Diego home price forecast.