Global| Jul 27 2009U.S. New Home Sales Gain As Prices Fall, Again
by:Tom Moeller
|in:Economy in Brief
Summary
Home buyers know a good deal when they see it, and looks like that's what buoyed sales of new homes last month. June sales of new single-family homes increased 11.0% from May to 384,000 after two months of modest increase. Though the [...]
Home buyers know a good deal when they see it, and looks like that's what buoyed sales of new homes last month. June sales of new single-family homes increased 11.0% from May to 384,000 after two months of modest increase. Though the latest sales level was the highest since last November, sales remained down by nearly one-quarter from last June and by nearly three-quarters since the 2005 peak. June sales outpaced Consensus expectations for sales of 352,000 units. The new home sales figures are available in Haver's USECON database.
The firming of home sales last month came as the median sales price fell 5.8% from May to $206,200. That decline reversed virtually all of the gains during the prior two months and left prices down 21.5% from their 2007 high.
The increase in home sales last month was led by a 43.1% increase in sales in the Midwest. That came on top of a firm gain during May. Sales in the Northeast also jumped. The 29.2% m/m increase brought them to the highest level this year. In the West sales also were quite strong and they rose 22.6% to their highest since July of last year. Sales in the South did not share the good news. They fell 5.3% to near the record low.
Price weakness again helped move the inventory of unsold homes which is off by one-half since the peak during 2006. In each of the country's regions, inventories are down by roughly one-third just during the last year.Moreover, the month's supply of new homes for sale also has dropped. Despite the low sales rate, in June the months' supply of inventories fell to its lowest level since last July of 2007.
IMF Plans to Inject $250 Billion Into Global Economy from the International Monetary Fund can be found here.
The current economy and the outlook from the Federal Reserve Bank of San Francisco is available here.
| US New Homes | June | May | Y/Y | 2008 | 2007 | 2006 |
|---|---|---|---|---|---|---|
| Total Sales (SAAR, 000s) | 384 | 346 | -21.3% | 479 | 768 | 1,049 |
| Northeast | 31 | 24 | -11.4 | 35 | 64 | 64 |
| Midwest | 73 | 51 | 5.8 | 69 | 118 | 161 |
| South | 177 | 187 | -34.4 | 264 | 408 | 559 |
| West | 103 | 84 | -9.6 | 111 | 178 | 266 |
| Median Price (NSA, $) | 206,200 | 219,000 | -3.4 | 230,408 | 243,742 | 243,067 |
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
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