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New Home Sales: Worst June on Record


Annualized New Home sales

1996 700,000
1998 800,000
2000 875,000
2002 900,000
2004 1,190,000
2006 1,300,000
2008 550,000
2010 330,000

If it wasn’t for a lack of context there would be no news.

From calculatedriskblog:

Ignore all the month to previous month comparisons. May was revised down sharply and that makes the increase look significant. Here is the bottom line: this was the worst June for new home sales on record.

The Census Bureau reports New Home Sales in June were at a seasonally adjusted annual rate (SAAR) of 330 thousand. This is an increase from the record low of 267 thousand in May (revised from 300 thousand).

New Home Sales Monthly Not Seasonally Adjusted Click on graph for larger image in new window.

The first graph shows monthly new home sales (NSA – Not Seasonally Adjusted).

Note the Red columns for 2010. In June 2010, 30 thousand new homes were sold (NSA). This is a new record low for June.

The previous record low for the month of June was 34 thousand in 1982; the record high was 115 thousand in June 2005.

New Home Sales and Recessions The second graph shows New Home Sales vs. recessions for the last 47 years.

Sales of new single-family houses in June 2010 were at a seasonally adjusted annual rate of 330,000 … This is 23.6 percent (±15.3%) above the revised May rate of 267,000, but is 16.7 percent (±10.9%) below the June 2009 estimate of 396,000.

And another long term graph – this one for New Home Months of Supply.

A realistic take from Zerohedge:

http://www.zerohedge.com/article/atrocious-new-homes-sales-data-sufficient-force-another-algo-mediated-short-covering-frenzy

“So June new home sales come in at 330,000 on expectations of 310,000: a decent beat by 20k or so, and a “record” increase from the May revised 267k. However, this “beat”, and massive 23.6% MoM surge only occurred due to prior downward (of course) revision which took away 57k from the past two months! The May number was revised down from 300k, or by 33k, to the lowest sales number on record of 267k. And April, not to be undone, two months after the initial release, has received its second downward adjustment, this time down by 24k from 446k to 422k. So let’s get this straight: this was the worst June on record, following the worst month on record in new home sales ever, the beat was completely drowned out by 57k worth of prior revisions, the average new home price slid another 1.4% to $213,400, yet just because the new home supply is down to “just” 7.6 month from 9.6 in May it is enough to push stocks to the moon (of course this completely ignores that existing homes sales are back to 9 months, and shadow inventory is more than double that. Who cares – machine language does not add, it only multiples). Another day, another insane day in stocks, which are now programmed to ignore reality, and just focus on the propaganda headline spin.”

They will ignore these reports too:

http://market-ticker.org/archives/2522-Green-Sharts!-Chicago-Fed-Index-0.63.html

http://www.zerohedge.com/article/after-expectations-modest-improvement-dallas-fed-manufacturing-index-plummets-21-4-prior-exp

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