Housing Chartbook: July 2010

Housing Falters after the Tax Credit Expires The response to the ending of tax credits for first-time homebuyers and some trade-up purchases was fast and furious. New home sales plunged immediately following the April 30 deadline to put home purchases under contract. Existing home sales were expected to hold up for another couple of months, but posted a surprising 2.2 percent drop in May, as … Housing Falters after the Tax Credit Expires The response to the ending of tax credits for first-time homebuyers and some trade-up purchases was fast and furious. New home sales plunged immediately following the April 30 deadline to put home purchases under contract. Existing home sales were expected to hold up for another couple of months, but posted a surprising 2.2 percent drop in May, as a large number of pending purchases had trouble clearing newly implemented credit and appraisal guidelines. Problems with the National Flood Insurance Program also added to closing delays. As a result, Congress extended the deadline to close on purchases already under contract to Sept. 30. The delay should prove fortuitous to homebuyers, as mortgage rates have fallen sharply in recent weeks. Thank you for your interest in Wells Fargo’s Economic Commentary by email. You are receiving this message because you have requested Economic Commentary information and updates sent via email. If you no longer wish to receive these emails, please click on the following link to access the Economic Commentary by email registration page: http://www.wellsfargo.com/economicsemail.

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