Down again across the country. An interesting thing is happening here, in The Woodlands, though. Sales of homes above $500,000 are moving briskly and increasing in value by over 15%/year. Sales of homes below $500,000 are slow, the market is glutted, and lots of lease-able houses are available. I don't know what to make of it, exactly. My guess is that owners in the lower range are defaulting and can't afford to even rent those homes. It's probably a good time to be renting used mobile homes for $700 a month.
From The New York Times:
There is a glutted market, alright. I'm just wondering if people in the East and West are seeing the same disparity--the bigger homes asking for more, the smaller defaulting. This would mean that the number of lower-income, middle-class people suffering is astronomical to pull the whole market down.
Those problems have been exacerbated in recent months by spreading problems in the subprime mortgage market, which offered loans to buyers with spotty credit histories. Rising defaults in those areas are dumping more homes onto an already glutted market.
The sales declines covered all parts of the country. Sales were down 7.3 percent in the Northeast and 6.8 percent in the West. Sales fell 2.8 percent in the Midwest and 1.7 percent in the South.