(Chart via WSJ)
Thursday, November 29, 2012
CHART: New Home Sales from the End of the Bubble
Bernanke's money printing is slowly pushing this macro higher, once again. If you are considering buying, now is the time, especially with rates so low. Lock in the current mortgage rates---and talk a banker into giving you an assumable loan. In a few years, you will look like a financial genius.
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Really bad advice, IMO. Money printing has created a bubble in housing -- again, even though the numbers barely show it.
ReplyDeleteConsider:
-- much of the recent housing "boom" was bought by speculators;
--population continues to age;
--jobs still difficult to find;
--wages not keeping pace with inflation;
--tax laws likely to change, whether for capital gains (specs bot houses;) or more likely, the mortgage deduction.
The only thing we know for sure, is that the money printing will end, & interest rates will rise. It may take 1-3 years, but the mkt has seen this movie, as can be seen by excess reserves not being "spent."