There is no better and easier way to rob people blind then to make them think you’re doing them a favor. Giving them an $8000 credit on a home priced at $250,000, that without that credit would cost them no more than $100,000, will be preferred over the cheaper home. Hey, it’s free money. Isn’t it?
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This has been my contention all along. The $8,000 tax credit is raising prices by far more than $8,000 because it is “qualifying” a huge number of people who otherwise would not be able to get a mortgage. Add to this the fact that banks have been told to keep homes off the market, and the market is 100% manipulated against the buyers.
IMHO, the only economic reason to buy right now is the fear that all this manipulation will cause our dollar to fall. So far, that’s been the case, but I’m beginning to worry that too many people are on the “falling dollar” bandwagon, and have started to lighten up a bit in my short dollar hedge.
