From the AP:
Fewer people bought previously occupied homes in May, lowering sales to their weakest point of the year.
Home sales sank 3.8 percent last month to a seasonally adjusted annual rate of 4.81 million homes, the National Association of Realtors said Tuesday. That’s far below the roughly 6 million annual sales rate typical in healthy housing markets…
Except in a few markets, I wouldn’t buy a home right now if you put a gun to my head. While the boosters are saying, for the nth time, that we’ve now reached the bottom, I don’t see it. I figure there is at least another 20% on the downside for home prices, and probably more in the worst hit areas. We won’t hit bottom until unemployment goes down – and even when that happens, there will be little or no upside to prices because there are (a) too many houses and (b) ever fewer people in the housing market as boomers retire and start to die off.
The long term good news here is that housing will remain affordable for quite some time – this will help those who are just starting out. The bad news is that all those people over the past 20-30 years who counted on their house as a retirement nest egg are out of luck.
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