Low Borrowing Costs Have Yet To Boost Housing Market

The experts I hear on the business news channels expect another 10-15% decline in home prices over the next 12 months. This discourages people from buying because they think, why should I buy now when I can get a similar home more cheaply in a year?

The rate of foreclosures is rising, putting more downward pressure on home prices and leading to ever more foreclosures.

Bloomberg reports:

“Interest rates help at the margins but they’re not game changers,” Nigel Gault, chief U.S. economist at IHS Global Insight in Lexington, Massachusetts, said in an interview on Bloomberg Television yesterday. “The problem is people’s access to credit is very limited. Even if the low interest rates are there, you maybe can’t take advantage of it.”
Applications to purchase homes fell 4.7 percent in the week ended Sept. 16 to the lowest level since February, according to an index from the Mortgage Bankers Association in Washington. The group’s gauge of refinancing jumped 2.2 percent.

About Luke Ford

Raised a Seventh-Day Adventist at Avondale College in Australia, Luke Ford moved to California in 1977. He graduated from Placer High School in 1984, reported the news at KAHI/KHYL radio for three years, attended Sierra College and UCLA, was largely bedridden by Chronic Fatigue Syndrome for six years, and converted to Judaism in 1993. From 1997-2007, Luke made his living from blogging. Living by Beverly Hills (Alexander90210.com), he now teaches the Alexander Technique (moving the way the body likes to move). Lessons cost $100 each and last about 45 minutes. In 2011, Luke completed a three-year teaching course at the Alexander Training Institute of Los Angeles. His personal Alexander Technique website is Alexander90210.com. Luke is the author of five books, including: » The Producers: Profiles in Frustration » Yesterday’s News Tomorrow: Inside American Jewish Journalism
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