New-Home Sales Drop 4.3%
As if you need me to fill in the details fo this stankbox:
Single-family home sales decreased 4.3% to 1.072 million units (seasonally adjusted annual rate) June sales were revised up to a -0.9% (1.12m) from a previous 3.0% decline (1.131m).
Consensus was for a modest 2.7% drop in July sales -- so the negative 4.3% was quite the surprise -- at least to those paying attention.
The big whackage showed up in the year-over-year numbers, with sales plummetting 21.6% since July 2005.
Amazingly, this only brings sales back to where they were in the beginning of 2004 -- which at the time, were a record high. Now, they are a dissappointment (at least to people who believe cyclical phenomena never have down cycles).
While mortgage costs are rising on a monthly basis, the recent rally in the bond market should help lower rates. A 30-year mortgage was about 6.76% in July, slightly higher than June's 6.68% -- but as we come to the end of August, those rates will be appreciably lower.
More later . . .
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Looking over at the root cause of the homies grief, I notice LEND has broken below it's October 2005 low. guess it's time to pull back to the 3- year chart. That's fine if adj. rate mortgage holders *CAN* afford to switch to a 30 year fixed. What worries me is if Mr. B lowers again before next year.
Posted by: snook | Aug 24, 2006 12:25:30 PM
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