September new home sales up from August, but hold off on the cheering
Nationwide new home sales were up 2.7% in September from August, the U.S. Commerce Department said in a report today, surprising some analysts who anticipated another month-to-month decline. But the September estimated annual sales rate of 464,000 single family homes was down 33% from September 2007.
This isn't the first such uptick, however. Last year, the August-September bounce was even greater, at 4.8%.
August 2008 was also a very poor month for new home sales -- they were down 35% from August 2007 -- making it easier for September to post an increase.
September new home sales were strongest in the West, where sales were up 23% from August, offsetting declines in the South, Midwest and Northeast. But Western sales were down 38% in September from the same month a year ago.
Year-to-year gains also need to be weighed against the dismal sales totals of last year. In September 2007, new home sales had dropped 23% from the same month a year before, and sales in the West were down 12%.
Anyone calling a housing market bottom based on the August-September bounce would still be going out on a limb. September inventory is at 10 months, down from August but up 10% from a year ago.
--Peter Y. Hong
To even ask or bring into conversation the question of a housing bottom, when we are just beginning to see job losses, is myopic at best.
Posted by: MyLessThanPrimeBeef | October 27, 2008 at 12:15 PM
Just beginning to see job losses?
We've been shedding jobs pretty steadily all through 2008.
Remember that unemployment has historically been considered a "trailing indicator."
In the past, the economy has generally begun to improve in advance of improvements in employment statistics.
Posted by: Drew | October 27, 2008 at 12:54 PM
Calculatedrisk.blogspot.com says : New Homes Sales in 2008 lowest since 1982. They have the charts and it is not pretty. So lets forget about the NAR cheerleaders.
Posted by: CD | October 27, 2008 at 01:47 PM
Foreclosure properties like those found on http://www.BuyMyHouseBeforeTheBankTakesIt.com are for sale and creating an opportunity in the market place. Foreclosure homes account for 38 % of the market place. Prices seem to be stabilizing and all lows seem to be at 2004-2005 levels. We may see a bottom at January 2004 pricing.
Posted by: Bill | October 27, 2008 at 03:04 PM
These home sales statistics as well as inflation and CPI are really becoming pointless with the blatant manipulation. The article on Bloomberg reported that the standard error is 12% for Sept! I guess they just picked 2.7% at random. For all we know the sales could have dropped 9% or gained 14%. Even government officials reported that they really don't know what's going on with the housing market. I expect to see more of these "feel good" news as the govt tried to kickstart consumer confidence.
Posted by: Last Laugh | October 27, 2008 at 03:07 PM
Bottom?
Excuse me I have to go in the other room and laugh...
Ok, I'm back. Whew.. I was in there a 1/2 hour!
We will be able to call the bottom after we see house prices just start to go up.
I don't know if the NAR has read or seen the news on TV but people are losing their jobs, the government is printing more money that they don't have and the taxpayers are going to be paying more. People are taking money out of their 401k's because they are scared to death.
It's just the beginning of the end of our economy. NO WAY AM I BUYING A HOUSE and become instantly up-side-down in a mortgage... NO WAY.
Medium household income in LA $55,000. Major factor for real estate is the ability to get a loan and actually be able to afford a house. (3x the annual income???) That's less than $200,000 folks. It ain't rocket science...
I'm personally looking forward the crash so house prices come back down to what they should be.
Shame on the Presidential candidates for trying to PROP UP the housing market. Shame on you!!!
Posted by: dclogang | October 27, 2008 at 04:08 PM
I agree Primebeef and Drew regarding job loss. The Commerce Department must be talking about areas that
was not hit by the bubble which skews things.
Posted by: Nelcisco | October 27, 2008 at 04:58 PM
Unfortunately, we are going to see a lot more job losses.
This is just the beginning.
You can take that to the bank!
Posted by: MyLessThanPrimeBeef | October 27, 2008 at 05:01 PM
Peter, I dearly hope you aren't one of the 75 in the latest "wave".
Posted by: Where's Peter? | October 27, 2008 at 06:48 PM
HEY BILL - do your comments come with a laugh track?
Posted by: sailor7x | October 27, 2008 at 08:41 PM
Ra Ra Ra REALTOR. YEAHHH!!!!!!
Not.
Posted by: Crash and Burn | October 27, 2008 at 11:38 PM