December 4, 2023
“Record Low Home Sales Plunge Even Deeper Than Financial Crisis!
Home sales, an economic indicator of consumer confidence, have seen a precipitous drop in the past three months. This has pushed existing home sales to a new low, one even worse than during the onset of the 2008 financial crisis.
This decrease in pending home sales has been attributed to many factors, most notably the drop in oil prices and decreased economic stability. Over the past several months, gas prices have plummeted as the market has seen oversupply. This cost savings for consumers has been offset by the market’s overall uncertainty, as many fear losing their homes and jobs in the coming months.
Furthermore, potential homeowners are not feeling secure enough in their financial stability to commit to the purchase of a piece of property. It has been estimated that if the market does not improve significantly by the fourth quarter of 2016, these totals could be even lower.
It would appear that the current economic downturn is affecting people all across the financial ladder. The drop in home sales has impacted low- and middle-income households the hardest. Homeowners are postponing their purchase decisions as they try to better prepare themselves in the face of these difficult financial times.
At this point, it is unclear what impact, if any, these statistics will have on the U.S. economy in the long-term. However, it is safe to say that this drop in pending home sales is concerning and should be something that policymakers take into consideration when making decisions on fiscal policy. Going forward, it is incumbent on the government to develop effective strategies to stabilize the housing market and inspire consumer confidence.