New home sales unexpectedly rise for first time in 6 months
Posted by: admin in Real Estate and HousingFiled under: Economic data, Housing, Recession
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.
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