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Economy in Brief

Housing Slowing Bouncing Maintaining Its Rise…Good Sign
by Robert Brusca June 26, 2007

Housing is still in the grip of a downtrend but prices are not plunging or even weakening further nor are sales trends worsening; in fact, they are showing some signs of stability. Housing rebounded in April and maintained most of its gain in May - a good sign for the sector. Question: How bad is this??

A tale of two suburbs? Maybe it’s not of two cities but definitely a tale of two suburbs – one affluent and one not. Average house prices are up and strongly at 6.5% year/year. Yes, some of that owes to a weak result a year ago, but not all of it. And year/year price declines for new homes are not very common. Median prices are off for two months running and the last year/year decline was in September of 2006. For average prices, they fell year/year in April 2007; they last fell year/year in November 2006. Obviously high-priced homes are faring better in this housing cycle.

Stability in sales by region is shown in the table below.

New Single Family Home Sales
Momentum: Annualized Rates Of Change Prices
As of: Total Northeast Midwest South West Median Average
May.07 Month-to-month percent change
May.07 -1.6% -11.0% 30.8% -7.3% -1.9% 1.5% 4.5%
Apr.07 12.5% 3.4% -7.9% 22.7% 8.1% -9.9% -7.9%
Mar.07 -1.5% 91.3% 0.0% -10.2% -3.9% 3.0% 1.2%
Annualized Rates
  Total Northeast Midwest South West Median Average
3-Mo 35.7% 304.3% 81.9% 8.7% 7.8% -21.5% -10.2%
6-Mo -14.6% 53.1% 4.0% -23.9% -23.6% -3.3% 15.1%
1-Yr -15.8% 19.1% -14.5% -17.9% -21.1% -0.9% 6.5%
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