HomeLoans Blog

Rates are ending the week with an increasing trend. The big news today is that home sales increased month over month. The big reason of course is the First Time Home Buyer tax credit.

This credit will likely prove to be bad for the housing market.

• ineffective in creating new home buyers
• costly price to pay many who were already decided to purchase
• borrowing from future buyers may cause a later slump in sales
• tax fraud is already a problem

The jump in home sales included 45% first time buyers and 29% distressed sales.

At the same time home prices declined accoriding the this week's FHFA Home Price Indes and some experts look to next year for more price declines.

We need programs to qualify more buyers. That is the bottom line.