If you’ve been paying attention to the housing market over the last few years, you probably know what a mess it became. Housing inventory was at an all-time low after the COVID panic—with millions of Americans eager to leave blue states and buy new homes.
At one point, houses will selling within hours of going onto the market. That was also fueled by ridiculously-low interest rates, being kept down by an out-of-touch and corrupt Federal Reserve.
But the housing bubble burst over this year, as the Fed was forced to raise rates. And the rates kept climbing. Now the fever is over, as some home buyers realize they paid way too much for their house. And now, the market is terrible, with even rich folks unwilling to shop.
The slowdown in home purchases is impacting the luxury market as well.
Since the beginning of 2022, 30-year fixed mortgage rates have surged from slightly over 3% to well over 5% — causing a drop in demand for new purchase loans and refinancing services. Sales of new single-family homes in April fell to 591,000 — falling far short of the 750,000 expected by analysts, as well as 16.6% below home sales in March.
For luxury homes — the top 5% of the market — sales dropped 18% from February to April 2022 in comparison to the same period last year, according to a report from real estate brokerage Redfin obtained by The Wall Street Journal. Prices, however, still remain elevated. [Source: Daily Wire]
Everyone predicted the house market would plunged after the post-COVID surge. But the situation was made worse by a number of Biden-related factors. Inflation has done a terrible job by making construction materials significantly more expensive.
Labor market shortages have further made the cost of producing a home sky-high. And a plummeting stock market only makes matters worse.
This could have all been avoided, had Biden not introduced so many terrible economic policies. If we had someone with half a brain in the White House, we could have correct the supply chain long ago. And if Democrats didn’t lockdown entire states for years, demand wouldn’t have created the bubble.
But when have Democrats ever thought-through their knee-jerk decisions?
The situation is so bad, even the rich won’t touch new homes. Luxury home sales dropped by 18%, that’s enough to put a damper on the market.
Biden is doing so horribly, even the rich are getting nervous.
Author: Jim Stone