Friday, the National Association of Realtors (NAR) released its Existing Home Sales Report for September, showing surging home sales particularly for condos and distressed properties, strongly indicating that the government’s “down payments-for-debtors” program is driving significant activity.
In fact, the program has had such exceptional simulative effects that even 4-year-old children, mostly unemployed, illiterate and largely ignorant of the demands and responsibilities of home ownership, are getting into the act.
Existing single family home sales were up 7.7% on a year-over-year basis while the median selling price declined 8.1% over the same period.
More notably though, existing condos sales were up a whopping 21.2% on a year-over-year basis, while the median selling price declined 11.7% over the same period.
It’s important to recognize that the nation’s housing markets are now awash with fraud as a direct result of the “first time home buyers” tax credit. While this government assistance program was intended to help needy “homebuyers” afford the minimal 3% deposit requirements needed to satisfy the FHA’s historically loose lending standards, it’s obvious now that the program has encouraged an unprecedented level of deceit among the American people.
With just a preliminary vetting of the tax credit claims, the Treasury Inspector General for Tax Administration J. Russell George has already uncovered half a billion dollars of scam claims. Of course, the NAR leadership is lobbying desperately to have this sham extended.
From chief economist Lawrence Yun:
“Much of the momentum is from people responding to the first-time buyer tax credit, which is freeing many sellers to make a trade and buy another home, … We are hopeful the tax credit will be extended and possibly expanded to more buyers, at least through the middle of next year, because the rising sales momentum needs to continue for a few additional quarters until we reach a point of a self-sustaining recovery.”
The following (click for larger versions) are charts showing sales for single family homes, plotted monthly, for 2006, 2007, 2008 and 2009 as well as national existing home inventory and month supply.
Below is a chart consolidating all the year-over-year changes reported by NAR in their most recent report.