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Economy Title: Sales of U.S. New Houses Plunge to Lowest Level on Record June 23 (Bloomberg) -- Purchases of new homes in the U.S. fell in May to a record low as a tax credit expired, showing the market remains dependent on government support. Sales collapsed a record 33 percent to an annual pace of 300,000 last month from April, less than the median estimate of economists surveyed by Bloomberg News and the fewest in data going back to 1963, figures from the Commerce Department showed today in Washington. Demand in prior months was revised down. The end of a tax incentive worth as much as $8,000 means the market will now be dependent on gains in employment, which are needed to lift incomes, brace confidence and contain foreclosures. A lack of inflation and concern over jobs and housing are among reasons Federal Reserve policy makers may reiterate a pledge to keep interest rates near zero. “Underlying demand for housing absent the government’s tax credit remains disappointingly weak,” Guy LeBas, chief fixed- income strategist at Janney Montgomery Scott LLC in Philadelphia, said before the report. “The housing market recovery is looking like a mirage.” Sales were projected to drop 19 percent to a 410,000 annual pace, according to median estimate of 76 economists surveyed by Bloomberg News. Forecasts ranged from 300,000 to 530,000. The government revised April’s purchase rate down to 446,000 from a previously reported 504,000. The median sales price decreased 9.6 percent from the same month last year, to $200,900, today’s report showed. Purchases dropped in all four U.S. regions last month, led by a record 53 percent drop in the West.
Months’ Supply
The supply of homes at the current sales rate jumped to 8.5 month’s worth, from 5.8 months in April. There were 213,000 new houses on the market at the end of May, the fewest since 1970. A report yesterday showed sales of previously owned homes unexpectedly fell in May, adding to concern the retrenchment following the end of the tax incentive will be deeper than anticipated. Existing house purchases, calculated when a contract closes, dropped to a 5.66 million annual rate, the National Association of Realtors said. New-home sales are considered a more timely barometer of the market than purchases of previously owned homes, which account for about 90 percent of the housing market. Other data show the market is starting to stumble. Housing starts in May declined by the most since March 2009, and building permits, a sign of future construction, fell to a one-year low, data from the Commerce Department showed. The National Association of Home Builders/Wells Fargo confidence index for June fell by the most since November 2008.
Fewer Applications
The number of mortgage applications filed to purchase houses dropped this month to the lowest level since 1997, according to data from the Mortgage Bankers Association. The Standard & Poor’s Supercomposite Homebuilder Index, which includes Toll Brothers Inc. and Lennar Corp., has dropped 28 percent since reaching a 19-month high on May 3. The broader S&P 500 Index is down 10 percent from April 23’s 19-month peak. Builders are also concerned that the Gulf oil spill and European debt crisis are hurting buyer confidence. Toll, the largest U.S. luxury homebuilder, said deposits have been running 20 percent behind the year-earlier period the past three weeks. “Concerns about the financial crisis in Europe and escalating regional political tensions, coupled with worries about the oil spill in the Gulf of Mexico and its effects on the economy and the environment have negatively impacted the outlook of American consumers,” Joel H. Rassman, chief financial officer at Horsham, Pennsylvania-based Toll, said in a June 16 statement. Hovnanian Enterprises Inc., the largest homebuilder in New Jersey, said orders fell 17 percent in the quarter ended April 30 from a year earlier, and contract signings slowed in May, indicating the tax credit helped pull some sales forward. Post Comment Private Reply Ignore Thread Top • Page Up • Full Thread • Page Down • Bottom/Latest Boofer is sweating like it's the verbal section of the SAT over this one... #67. To: war (#48) Keep hiding behind the bozo, bozo. (laughing) You've always been a world class pussy. Badeye posted on 2010-01-14 16:12:48 ET Reply Trace I'm biased, obviously, given the shit I'm subjected to daily here from the anti groupie. Badeye posted on 2010-06-10 11:34:31 ET Reply Trace Private Reply #2. To: war (#0) The Obama depression
#3. To: no gnu taxes (#2) Krugman was right. #67. To: war (#48) Keep hiding behind the bozo, bozo. (laughing) You've always been a world class pussy. Badeye posted on 2010-01-14 16:12:48 ET Reply Trace I'm biased, obviously, given the shit I'm subjected to daily here from the anti groupie. Badeye posted on 2010-06-10 11:34:31 ET Reply Trace Private Reply #4. To: war (#1) LMAO
#5. To: war (#3) Krugman was right. Have to respectfully disagree on that one. Creating more debt is not the answer. Paying the bill is.
#6. To: no gnu taxes (#2) Geez, and who's been screaming Morning in America since 1980? We've been living the Truman Doctrine since 1947. Powered by growing our energy. PO was Katrina. The Dragon King of Deepwater Horizon puts us into the Olduvai. Only the Top 10% have been thinking life's good since Katrina. Only the Top 1% are thinking that now.
Quote: Originally Posted by simeon9benjamin View Post Just watch my fox 8 news and they basically are hoping it fall apart lets keep firgers crossed. My other local mets do mention it but keeps it on the down low. Man you can tell when trouble is coming they do not go into much detail at all. Man did they learn anything from Katrina not the time to be trying to keep a secret from the public. Have to concur with you there - the stations were reporting 92L from the start though it had minimal chance of developing - now, with a 50% from their venerable NHC, not a peep from the nationals, and scarce mention from the locals. We don't know what we don't know - but, shouldn't folks know they at least need to be paying attention? And when this hits, the depression on the NOGC+Florida moves North with the evacs.
#7. To: mcgowanjm (#5) Have to respectfully disagree on that one. Krugman wrote an article last Fall or early Winter in which he stated his belief that the stim was not big enough to sustain growth to the point of making a significant dent in unemployment. His further point to this was that without a significant dent in unemployment, once the Housing credit expired, there would be nothing to sustain the housing market. #67. To: war (#48) Keep hiding behind the bozo, bozo. (laughing) You've always been a world class pussy. Badeye posted on 2010-01-14 16:12:48 ET Reply Trace I'm biased, obviously, given the shit I'm subjected to daily here from the anti groupie. Badeye posted on 2010-06-10 11:34:31 ET Reply Trace Private Reply #8. To: all (#0) Anybody check this one for accuracy yet? We know the poster can't be trusted. Just 10 days prior to the explosion, the Obama administration’s regulators gave the oil rig a pass, and last year the Obama administration granted BP a National Environmental Policy Act (NEPA) exemption for its drilling operation. #9. To: Badeye (#8) Housing is actually doing very well...the whole article is a lie, Boofer. Sorry... #67. To: war (#48) Keep hiding behind the bozo, bozo. (laughing) You've always been a world class pussy. Badeye posted on 2010-01-14 16:12:48 ET Reply Trace I'm biased, obviously, given the shit I'm subjected to daily here from the anti groupie. Badeye posted on 2010-06-10 11:34:31 ET Reply Trace Private Reply Top • Page Up • Full Thread • Page Down • Bottom/Latest |
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