Housing Values Drop As Sales Edge Up
Here's the classic good news/bad news story: New home sales were actually up in September of this year compared to last year, by 2.7 percent, an encouraging sign.
Because home values are continuing to plummet. Houses are cheap; people with cash are buying them. For people who own homes, that's discouraging.
In September of 2007, the U.S. median home value was $240,300. By September of this year, that number had dropped to $218,400, the Commerce department said moments ago.
No doubt you have seen a corresponding drop in the value of your home, as well. For some people, their home now is actually worth less than the mortgage they took out on it; the technical term for this is "underwater." But people who are actually underwater probably have another term for it.
The sales uptick in September contrasts to the big drop in August, when sales were down 12.6 percent compared to August 2007.
If there's just a little more good news to add to this good news/bad news story, it's that the September sales uptick is beginning to burn off the excess inventory of housing. If that continues to come down, homeowners should start to see the value of their homes edge back up, or at least stop falling.
In the second half-hour of trading on Wall Street, the Dow is flirting with positive territory.
The S&P 500 and Nasdaq are both trying to get or keep their noses above water.
-- Frank Ahrens
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