Don’t blame the summer home sales lull on the tax credit: Olick

August 20, 2010 03:30PM

CNBC’s Diana Olick

The summer’s downturn in U.S. home sales is often attributed to the expiration of the first-time homebuyer tax credit, which inflated demand prior to its deadline for signed contracts at the end of April. But according to CNBC’s Diana Olick, that’s not the whole story. She cites a sharp drop in home sales in San Francisco during the month of July — to their lowest level in 15 years — as evidence that the tax credit’s expiration could not possibly account for the lull altogether. The median price of a home in that region is $402,000, and most buyers in that price range wouldn’t even have qualified for the tax credit, she notes. The heart of the problem, she argues, is “a startling lack of confidence.” A recent report from Zillow.com said that one-third of all U.S. homeowners don’t believe the housing market has bottomed yet, and another from Trulia.com revealed that fewer renters than ever are planning to become homeowners. [CNBC]