House Prices Declined 'Unexpectedly' in August

Includes: IYR, SPY
by: Howard Richman

Home sales declined in August, as did the average price at which houses were sold. An article in the Christian Science Monitor puts a positive face on the story. Here's a selection:

The median sales price of existing homes ... declined from $181,500 in July to $177,700 in August, according to a National Association of Realtors (NAR) report released Thursday....

Outside analysts downplayed the one-month decline. “We suspect it is just a temporary blip in the improving trend rather than a sign of renewed weakness,” wrote Paul Dales, an economist at Capital Economics, in an analysis....

I expected this decline, and I expect that house prices will continue to decline. The real blip was the temporary pause in the fall of house prices, bought at huge expense to taxpayers by the incompetent economists of the Federal Reserve and the Obama administration.

Instead of tackling the cause of our economic problems, the demise of our manufacturing sector due to our toleration of mercantilism, they continue to treat the symptoms, such as the falling house prices. Has America ever been more ill-served by incompetent leadership?

Disclosure: No Position