Home Sales Drive the Recovery

January 4, 2010 | 114 Comments

It’s been a long time coming, but thanks to the improving housing market the economy seems to be pulling out of the recession. Existing home-sales rose 7.2 percent from June to July to post a seasonally adjusted annual rate of 5.24 million units. This was the highest monthly increase in the last 10 years. Resales were also 5 percent higher in July 2009 than they were a year earlier-making July the first month in nearly four years that we’ve seen a year-over-year increase.

The real star of housing sales has been the first time home buyer tax credit. More than 1 million households have used the credit since it was enacted a year and a half ago. It will still take years for our economy to replace the 7 million jobs we have lost due to the recession. In order to re-build hiring, attention must turn to still hard-hit commercial real estate, which continues to face a debilitating credit crunch. The Federal Reserve has now started focusing on this issue and we hope that credit will flow increasingly into the market. Commercial real estate’s future still remains a wild card.

Continuing the home buyer tax credit and relieving the commercial real estate credit crunch are what we need to bring those lost jobs back and keep the economy growing.

Source: Article by Lawrence Yun, Cheif Economist of the National Association of Realtors, www.realtor.org/realtormag


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