Posted on 05/27/2008 9:16:39 AM PDT by NYC Republican
Sales of new homes rose in April for the first time in six months although the unexpected increase still left activity near the lowest level in 17 years.
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The Commerce Department reported Tuesday that sales of new homes rose 3.3 percent in April to a seasonally adjusted annual rate of 526,000 units.
But the government revised March activity lower to show an even bigger drop of 11 percent to an annual rate of 509,000, which was the weakest pace for sales since April 1991. Economists believe that new home sales will remain weak for some time as the housing industry struggles with falling prices and rising mortgage foreclosures, which are dumping even more homes on an already glutted market.
The Commerce report showed that the median price of a new home sold in April dropped to $246,100 in April, down 4.2 percent from April 2007.
A separate report showed home prices falling during the first three months of this year at the sharpest rate in two decades. The Standard & Poor's/Case-Shiller index fell 14.1 percent in the first quarter compared with a year earlier, the biggest year-over-year decline since the index began in 1988.
The Commerce report on new home sales showed the April rebound was led by a huge 41.7 percent surge in sales in the Northeast. Sales were up 8.3 percent in the West and 5.8 percent in the Midwest. The only region which saw a decline in sales in April was the South, where sales fell by 2.4 percent.
The inventory of unsold new homes edged down slightly to 10.6 months' supply at the April sales pace, compared with 11.1 months in March. However, the April level was still about double the inventory level that was normal during the five-year housing boom.
That boom ended in 2005 and since that time the housing industry has been struggling in a tough environment with falling sales and prices and rising mortgage defaults.
Economists believe that home prices will remain under pressure until the sizable level of inventories is worked down to more manageable levels. Many analysts don't expect to see a rebound in prices until sometime next year.
The number of for sale signs on this road has double in the past week. None are selling, none have sold since last year. A lot of people seem to be getting ready to vacate this town.
Is it because the prices have dropped 14.1%, as the other thread indicated?
If gas prices were to suddenly to drop, I wonder what is
next on the MSN/ Democratic agenda.
And, most are overpriced.
At least they put quotation marks around "recession."
All are priced at their peak or higher. A 12X20 cabin for $100,000. What a deal!
Look, go ahead and ignore Greenspan, Buffett et al. They can offer opinions on recession, but they don’t get to make the official call.
Pay attention to someone like Martin Feldstein. He’s a member of the NBER. The NBER DOES get to make the call whether we’re in a recession.
So what does Feldstein say?
Let’s see:
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=ag0t9NpkLkz0
So there you go.
The more that conservatives and Republicans keep blaming the MSM for the state of the economy, the harder we’re going to lose in ‘08 and ‘10.
We’re literally whistling past the graveyard and have been since Bush kept trumpeting the growth in a housing market that was largely driven by outlandish speculation. We’ve been seeing commodity price inflation since 2004 in a serious way, and Bush’s economic team has consistently ignored it, preferring instead to keep babbling about the growth of the housing market while wage growth was largely stagnant and unable to support housing valuations.
Good news is ALWAYS unexpected during a GOP adminstration.
While, on the contrary, bad news is ALWAYS ignored during a demorat adminstration.
(oops, sorry for the typo. I’ll get it later)
So, house sales post a brutal 42% year-over-year decline to near historic lows and the MSM labels that an “unexpected rise”. so much for the constant drumbeat by the Freepyannas that the MSM is just trying to talk down the economy.
RE tanked. It fell 42% year-over-year from last April and posted the sencond worst April sales since 1991. And that is evidence the economy is swell? I’ll bet you won’t convince any Realtors or RE Brokers how wonderful those sales numbers are...
April 2008 home sales were horrible and that’s the truth. Or do I have to add a raspberry like Lilly Tomlin from “Laugh In”?
So am I the only one here who read that even noticed home sales declined a whopping 42% year over year from last April.
You can’t compare April to March. April sales re generally better than March sales. That is like saying “house sales fell off in December from June”. It is meaningless. You have to compare how a month this year compared with the SAME MONTH in prior years.
Where are you getting that from?
I see housing prices taking nosedives by me, but I didn't think it was that much, even in the really overpriced neighborhoods. Homes in my town (philly suburbs) that were going for a ridiculous 800k a few years ago are now running mid to high 600k. More like 20 to 25 percent declines. And in my own more reasonably priced neighborhood prices have held pretty steady, maybe down a couple of percent.
Home sales rise - still near 17-year low
Sales of new homes in April were up slightly from March, but are down 42% from 2007.
By David Goldman, CNNMoney.com staff writer
Last Updated: May 27, 2008: 2:12 PM EDT
New home sales rose unexpectedly in April, but remain near 17-year lows.
NEW YORK (CNNMoney.com) — New home sales rose unexpectedly in April but remained near historically low levels, according to a key government report on the battered housing market.
April sales came in at a seasonally adjusted annual rate of 526,000, a Census Bureau report showed, up 3.3% from March. The reading was above the consensus forecast of 520,000, according to economists surveyed by Briefing.com.
But home sales were down 42% from a year earlier. April’s reading was the second-lowest annual rate since October 1991, behind March of this year.
Link: http://money.cnn.com/2008/05/27/news/economy/new_homes/index.htm?postversion=2008052714
By the way, that 42% drop year to year is a drop in sales NOT in price.
The year over year price drop is 14.1%, from another article posted here on FreeRepublic.
The point is, the original article posted here we are replying to notes an increase in sales from March to April, but fails to note the 42% drop in sales from April 2007 to April 2008.
The liquidity crisis didn’t hit us hard until August to October of last year. Lending standards are much higher than they were in April 2007. A lot of people can’t get loans right now, even if they wanted them. A lot of people who want to refinance, can’t do so. Bad credit...
It is my understanding that probably much of the rise in sales is due to foreclosures which result in sales albeit forced sales.
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