Only the number of times Obama has told us after three and a half years of his economic policies in place that the bad economy is Bushes fault surpasses the number of times the pundits have told us that the housing market has hit bottom and is recovering.
They’ve told us every time housing reports are released. If you’re one of those people who believe Obama, that there is a recovery, or these pundits about housing, you don’t need read any further. Facts are apparently unable to penetrate your skull.
The uncertainty on the constitutionality of Obamacare has been settled for now, but uncertainty does not go away. There is a chance the Republicans win the White House, both branches of congress, and actually repeal the leviathan.
Here’s a prediction. If Republicans gain control and repeal Obamacare the uncertainty shifts to what will replace Obamacare. Whatever that is, it has to be better than Obamacare, but it may not be good. Compromise is not taking two bad ideas to formulate a hybrid bad idea.
What’s the difference between a big government Democrat and a big government Republican? There is none. Hence the uncertainty remains.
If the Republicans win and fail to repeal Obamacare then they just signed a death sentence for the Republican Party. Overnight the Green Party would have more members.
What if Obama wins and Obamacare can’t be repealed? Then the inevitable economic disaster brought on by liberal economic policies will move into overdrive. It was already fiscally impossible for a return to prosperity with Obama’s anti-business, anti-capitalist, anti-fossil fuel, pro-crony capitalist, pro fairy tale green economy, tax and spend policies.
How will this impact the housing market? Simple economics. Obama proposes doing the same things over and over expecting different results. Central planning, government picking winners and losers, more spending, more debt, higher taxes. Everything he implemented his first term which resulted in the worst jobs market and unemployment since the Great Depression.
Approximately 28% of all home sales have been to investors snapping up foreclosures and short sales. The remainder of the activity has been predicated upon pent up demand sparked by Bernanke’s insane interest rate policy.
When that pent up demand is satisfied where will the demand for homes be created? Jobs? Sorry, Obamacare is one of the biggest job killers since it passed, just wait until it is fully implemented.
It’s true that the home builder’s on Wall Street stocks are rising because their home sales are rising, however they constitute such a small sliver of the home building industry that may lead you to a false conclusion.
The new and improved regulations from EPA, and OSHA are driving small builders out of business favoring the big companies. The big boys will simply have the same size slice, but this time of a half sized pie.
New home sales still run less than 50% of healthy. Existing home sales are running 60% of healthy. How healthy will home sales be if the jobs market continues to deteriorate, or when interest rates go up?
Once everyone with a modicum of intelligence who can qualify for a mortgage buys a home, the remaining inventory for sale will be left to the vultures, and the ‘have to’ move people.
The inventory of homes for sale as reported by the National Association of Realtors is a false positive. There is a shadow inventory of two million foreclosures being slowly released by banks in an attempt to prop up prices. That means the rate of foreclosure is falling, but don’t be fooled. That’s due to banks figuring out it is more cost effective to work out a short sale than to foreclose.
But what of the millions who are sixty days late or more on their mortgage payment? How many millions more will be in jeopardy when they lose their jobs as the economy contracts?
The stories from the media and from the administration that the economy is recovering, that housing is recovering, and that the private sector is fine are nothing more than happy talk. These folks are either incompetent or holding out hope against hope that if they say it long enough it will come true.
Out here in the real world housing is the patient that has been removed from the ICU and is now going in and out of a coma in a private room on a respirator. If Obamacare stands, or if Obama gets reelected and we get more of the same policies, Obamacare will turn off the respirator.
Should there be divine intervention and the patient survives after four more years of abuse from Obama policy, there may not be a house for the patient to return home.
The opinions expressed here are solely those of Fritz Pfister or identified sources, and not necessarily those of RE/MAX Professionals of Springfield or RE/MAX International.