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Real estate association urges Obama to take action to boost property sector

The latest data from the National Association of Realtors shows that sales contracts on existing homes fell 4% in November. The whole nation was affected with declines of 7.2% in the Northeast, 6.7% in the Midwest, 2.4% in the West and 2.2% in the South.

In the face of such bleak numbers, NAR economists urged Congressional action on a possible real estate-focused stimulus plan that would offer incentives to borrowers and 'unclog the mortgage pipeline.'

'It's crucial for the new administration to move quickly to remove impediments and offer home buyers the incentives they need to tap into today's historic low mortgage interest rates,' said NAR president Charles McMillan, a broker at Dallas-based Coldwell Banker Residential Brokerage.

The decline is backed up by other recent data. Home prices and sales volumes have continued to decline according to New York-based real estate data and analytics firm Radar Logic. Prices and sales volume decreased more in October 2008 than in any other month since the company's data set began in January 2000.

Economists believe things will get worse. A survey of 25 economist conducted by the Bureau of National Affairs suggest that the recession in the US last another six months before easing, and that recovery in the financial markets will be slow.

'The gradual resumption of growth starting in the third quarter is likely to hinge on the success of the federal government's massive economic stimulus and financial intervention efforts,' a spokesman said.

The economists surveyed believe that the Federal Reserve will maintain the historic low target for key interest rate, now holding at a range of zero to 0.25%, before raising it at the end of 2009.