Tag Archives: Tax Credits

Housing: 2010 Bright Spots Fading

The few bright spots appear to be a result of government stimulus, the homebuyer tax credits in particular. However, rather than jump-starting the market, the government’s interventions seem to have only had a temporary effect that evaporated as the stimulus expired.

Housing supply vastly outstripped demand in 2010, especially when one considers the shadow inventory of homes with mortgages in default or foreclosure. This state of affairs continues into 2011. As a result, RPX metrics continue to show weakness.

Greg Fielding in The New York Times

The second reason is that, Mr. Yun notwithstanding, most people simply do not believe that housing prices are even close to hitting bottom. “In the Bay Area, a house that was worth $300,000 a decade ago became a million-dollar home,” said Greg Fielding, a real estate broker and blogger. “Now it is listed at $800,000.” That price, he suggested, was still unrealistically high.