The U.S. housing sector's road to recovery is getting rougher: Housing starts fell a worse-than-expected 5% in June to a seasonally adjusted annual rate of 549,000. Is it time for another home buyer's tax credit?
It's getting harder to avoid the evidence pointing to more trouble ahead for housing. Essentially, there's a massive mismatch between rising supplies of homes for sale and dwindling demand from buyers. Not even high-end markets are immune.
In leaving interest rates unchanged and putting out a somewhat more downbeat assessment of the economy's progress, the Fed also didn't address the threat of deflation or propose new strategies for getting the country back to work.
Sales hit a record-low 300,000-unit annual rate, as the end of the homebuyer tax credit discouraged buyers. More broadly, the U.S. now faces a policy choice: Should it continue to rely on housing as an engine of growth?
One of the most disturbing aspects of the home foreclosure crisis is how much damage it has caused in minority communities. Activist group Committee for Responsible Lending finds black and Hispanic borrowers are twice as likely to have lost their homes.
A setback on the housing front, but one that was expected: home builder confidence plunged in June, the National Association of Home Builders said, as builders%u2019 sentiment became more reserved following the April 30 end of the home buyer tax credit.
