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U.S. new home sales unexpectedly rose 3.2% (PDF) to a seasonally adjusted, annualized pace of 526,000 in April 2008 -- the first rise in new home sales in six months, the U.S. Commerce Department announced Tuesday.
Economists surveyed by Bloomberg News had expected April 2008 new home sales to register a 522,000 annualized rate.
Nevertheless, sales are still down about 42% in the last 12 months.
Meanwhile, inventories dipped to a 10.6-month supply in April 2008 at the current sales pace, compared to an 11-month supply in March 2008 and a 9.8-month supply in February 2008.
Also, the median sales price increased 9.1% in April 2008 to $246,100.
Sales rose in three regions: Northeast, up 42%; West, up 8.3%; and the Midwest, up 5.8%. Sales fell 2.4% in the South.
Economic Analysis: Sales did nudge-up slightly in April 2008, but the key stats remains the large, 10.6-month supply of unsold new homes and the 42% decline in new home sales compared to a year ago. A normal, healthy market has a 3-4 month supply of new homes for sale, and that fact, combined with the large decline in year-over-year sales, suggests a market with scant demand. Investors / traders should also ignore the one-month rise in the median sales price: a trend takes at least 3-4 months to form, and the higher one-month median price jump could simply reflect a large number of lower-priced homes taken off the market, or not sold.
New home sales unexpectedly rise for first time in 6 months
Posted May 27th 2008 11:00AM by Joseph Lazzaro
Filed under: Economic Data, Housing, Recession
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Reader Comments (Page 1 of 1)
5-27-2008 @ 12:11PM
B. Harrison said...
I would venture that is nothing more than some individuals trying to second guess the market . . . and we are still in the early stages of this economic debacle. The initial massive layoffs, foreclosures, and bankruptcies have just begun . . . there is a lot more that will be occcurring. Time will tell how long these investors have to hold onto these properties before they can realize a profit . . . .five to seven years or longer?
5-27-2008 @ 12:12PM
dsa1033 said...
Franco said consumers' worries about inflation, fueled by increasing prices at the gas pump, are now at an "all-time high" and are likely to rise further in the months ahead. She added that based on consumers' outlook on the economy, she believes there's little likelihood of a quick turnaround.
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Well, after the debacles of the costs of the unwarranted war against Iraq, coupled with the melt down of the "charade of a "booming economy", coupled with the fact that it will take 18 mos. to 3 years for "full disclosure" to be provided, whouldn't it be foolish to invest in a market that does not have much integrity to it?
The government (our representatives) should demand, by law, that full disclosure be provided to all potential investors. And any CEO, CFO or uppermanagement who doesn't rpovide FULL DISCLOSURE should be prosecuted to the fullest extent of the law for felony financial fraud. That might restore some faith in the market place.
5-27-2008 @ 12:14PM
B. Harrison said...
Franco said consumers' worries about inflation, fueled by increasing prices at the gas pump, are now at an "all-time high" and are likely to rise further in the months ahead. She added that based on consumers' outlook on the economy, she believes there's little likelihood of a quick turnaround.
==================================
Well, after the debacles of the costs of the unwarranted war against Iraq, coupled with the melt down of the "charade of a "booming economy", coupled with the fact that it will take 18 mos. to 3 years for "full disclosure" to be provided, whouldn't it be foolish to invest in a market that does not have much integrity to it?
The government (our representatives) should demand, by law, that full disclosure be provided to all potential investors. And any CEO, CFO or uppermanagement who doesn't rpovide FULL DISCLOSURE should be prosecuted to the fullest extent of the law for felony financial fraud. That might restore some faith in the market place.
5-27-2008 @ 6:44PM
Pan_theFrog said...
ExxonMobil is starting to diversify it's holding by investing into buying new homes so they can become our landlords. They figure they might as well own every bit of our lives.
Yes, this is a joke, but at the same time I wonder just how much of the new home market $10 billion would buy? $10,000,000,000 / $250,000 = 40,000 homes
5-27-2008 @ 2:23PM
william lindblad said...
The sales rise is probably more an aberration than anything else. It would seem to reflect that there remains some purchasing and offers the hope of a continued trend. It is more likely the result of people who were renting and waiting for a significant price drop to purchase. If this is so, most of the buying is finished and next months figures will reflect same.