Realtors: Sales of existing homes fall 8.6% – much worse than expected – as median prices suffer worst decline since Depression.
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I am a little nervous at the use of the word, “Depression.” I am not nervous in the facts that represent themselves. The numbers are out there to give us some cause to think that this might be the case, but the sheer level and pervasiveness of the actual Depression is something that I don’t think we have seen yet.
We must remember that the total population of the US was much smaller, that the sheer number of businesses, properties and farms were far fewer than today and that much of the nation was still under-developed. Here we are years later and to say that we have a true Depression that is of the magnitude of the Great Depression is not truly true. Percentage-wise, I think we still have a very affluent society versus the society of the 1930’s – 1940’s. I think it will still have to get much worse.
So, in the case of the housing market, we CAN say that the prices have taken the largest drop since the Great Depression, but the prices also took the greatest speculative leaps over the last 5 years ever in history. So, with that said, this is a correction, not a Depression.
Let’s just get our perspective right.
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