new home purchases

Ok, I know I am missing something here. I have not been living under a rock, nor have I been in a coma.

We have all been involved in this recession, and have watched the stock market tank. We’ve seen consumer purchases drop like a rock. We’ve seen new car sales slow way down. We’ve seen massive lay-offs, and many people unable to find work. Yet somehow, the housing market is red red hot. How is this possible? How is it people can afford to purchase homes at record rates when they won’t or can’t spend a dime on anything else?

Mortgage rates are down to near record lows. Makes owning a home much more affordable, especially compared to rent.

Alot of the indicators say we haven’t been in a recession for months.

Consumer confidence might be the biggest negative, but consumer perception doesn’t match alot of things like CPI, inflation, home sales, etc.

Stocks are in a predicted lull, but a non-issue as to the economy health.

Media Driven Recession?

Big Business is warming up, and once the stock market gets moving, someone might declare it over, way after the fact.

Just don’t ask the purchase price :slight_smile:

As an example, on a 30-year morgage of $250,000 at 8% interest, the monthly payment would be $1835. It’s fairly easy today to get a rate at 5% or lower, meaning that same payment would be $1342, or almost $500/month cheaper. That’s real money, and the reason why the housing market is so hot.

-lv

That, and the fact that land is never created, but more people are created all the time :slight_smile:

Another reason they are buying homes is because its one of the only profitable investment ideas at the moment.