Purchase Aps Hit 13Y Low as Tax Credit Expires

Not since June 2008 has the housing sector been completely devoid of some form of tax incentive to help bolster sales, until now that is and it shows.  MBA purchase applications have taken a precipitous drop over the past two weeks falling to levels not seen since the end of 1997.  The government’s approach of bolstering current sales by borrowing from the future sales appears to have worked, and now it’s time to pay the piper.  Headwinds for the sector remain strong generated by stiff credit conditions, high unemployment, increasing foreclosures, large inventories of vacant homes, and a lack of tax credits; while tailwinds are slowing to a breeze.  A robust recovery in housing during 2010 is extremely unlikely.

  MBA Purchase Applications