Home Sales Drop

Home For Sale signs litter my street. From my front porch I can see three for sale signs, and if I walked around the block at least 20% of the homes in my neighborhood are for sale.

Just today the Commerce Department released some numbers that support my opinion that home sales are suffering. According to the g-man report, new home sales dropped by 6.6 percent in June. This number is three times what the so-called experts expected, and caps a horrible year in new home sales.

Why should you or I worry? Well, home sales are the pointy end of the consumer spear. A home sale leads to appliance, furniture, and landscaping sales, which translate into jobs and income. The decline in home sales should not be seen as a harbinger of doom, but do reflect a drop in consumer confidence that can create a trickle down affect on local economies. Home buyers will also see the decline in sales as a buying opportunity, and choose to wait out the inevitable price drops—thus compounding the problem.