Housing sales took a nose dive in July, according to the numbers crunch. I'm using Nashville as an example because that's the real estate market I am directly involved in and I know it all too well.
The last year has been very difficult for us as landlords. We've had a huge turnover in tenants; much larger than usual. We're still getting 30 day notices, which is very strange for this time of year. Usually, the season starts to wind down along the middle of August.
The article from the Tennessean sums it up. The Obama tax credit for first time homebuyers is gone. The article further points out those new homebuyers have already bought. That means houses were sold earlier this year and sales are not being spread out over the remaining months of 2010.
I won't criticize the Obama tax credit. I've already done that ad nausium. But I will say this. You can't keep on interfering with the markets. I don't think you can tweak and play with the real estate market, or any market for that matter without causing further damage.
The important thing is to look to the future. What can we expect? More of the same, perhaps?
I am guessing there won't be any more stimulus for first time buyers. It will go the way of the clunkers for cash program, thank goodness. What I do see as a possibility is that the Team Obama will now turn to Freddie Mac and Fannie Mae distressed homeowners and will give them some sort of bailout. I didn't think that was conceivable a few weeks ago. I now know anything can happen with this White House.
That will be cataclysmic. Homeowners who are paying off their mortgages will think it isn't fair and why should they keep on struggling? One suggestion is to bring hope and change to Freddie and Fannie in the form of a complete makeover.
Still, I'm generally optimistic. I think once we're past the New Year, things will improve. Real estate will make a comeback. It always has. That is what keeps me going. I know the cycle will turn. But I think the government ought to leave these markets alone now and let the chips fall where they will.
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