Is The Real Estate Market Being Hyped?

On the the USAtoday front page today one could get a sense of the outrage: property taxes up as house prices fall…

Despite the downturn, the market value of millions of homes still exceeds their assessed value used for tax purposes. “Some people are irritated to learn the news,” says Jim Todora, a property tax assessor in Sarasota County, Fla. “Their home’s value may have gone down, but their property tax is still going up.” … “People read about how the market has crashed,” says Polk County Assessor Jim Maloney in Des Moines. “But that change doesn’t show up for a long time.” Among the few who may benefit from falling values: people who bought recently at the market peak, only to see prices drop…..

Then we had yesterday: (CBS/AP) Down 8.4%, Most Since January 1989; Consumer Confidence Also Down, Thanks To Gas Prices.
Sales of existing homes plunged in March by the largest amount in nearly two decades, reflecting bad weather and increasing problems in the subprime mortgage market, a real estate trade group reported Tuesday. The National Association of Realtors reported that sales of existing homes fell by 8.4 percent in March, compared to February.
versus:
(MarketWatch) - Boosted by warmer weather in the Northeast and Midwest, sales of new homes increased by 2.6% in March to a seasonally adjusted annual rate of 858,000, the Commerce Department reported Wednesday.

Of course, the good news was inflated and the Wallstreeters rallied when hearing this favorable report, this among a few other things. The problem is that housing represents the pillar of the economy and thus a gauge foreshadowing economic health. Psychology is truly important here. As we’re typing this the Dow was bouncing back and forth over 13,000 … Turn you TV on tonight, you will most likely hear more about this rebound in sales than the current gloomy trends. Do the math by yourself and you will know where the truth lies.


So what do you think?