The expiration of the housing tax credit has left a gaping hole in housing sales. The Purchase Index released weekly by the U.S. Mortgage Bankers Association first pointed to a severe pullback in sales, and this week’s report from the U.S. MBA is not very encouraging.
The Purchase Index, which looks at applications to buy homes, dipped 2% in the latest week and is now down in eight of the last nine weeks. Even record low mortgage rates that are hovering well below 5% for a 30-year fixed loan have failed to encourage buyers.
A stronger economy, significant job creation, waning foreclosures and a sense that the decline in housing prices is over are among the major factors needed to place a solid foundation under a shaky market.
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