New Home Sales Fall 21.3%

Get ready for another round of bad reporting:

The $8,000 Fed tax credit (1st time buyers) and a $10,000 California tax credit (new homes only) likely helped out in NHS this month. Falling prices are also contributing to sales activity of the sector, which represents about 15% of the overall housing market.

Here is the official New Home Sales:

Sales of new one-family houses in June 2009 were at a seasonally adjusted annual rate of 384,000, according to estimates released jointly today by the U.S. Census Bureau and the Department of Housing and Urban Development. This is 11.0 percent (±13.2%)* above the revised May rate of 346,000, but is 21.3 percent (±11.4%) below the June 2008 estimate of 488,000.

Thus, we in fact know that Sales fell from last year. They were down 21.3%, a number greater than the margin of error.

The monthly data, on the other hand, is not statistically significant. Therefore we DO NOT KNOW what the change was from last month, as the margin of error is greater than the reported data point.

The usual suspects got it wrong, as they do every month.

If New Home Sales are so strong, then can anyone explain why prices are still plummeting? Median home prices dropped 12% year-over-year, and 5.8% from the prior month. junenhsnsa.jpg

Chart via Calculated Risk

Originally published at The Big Picture and reproduced here with the author’s permission.

4 Responses to "New Home Sales Fall 21.3%"

  1. Anonymous   July 27, 2009 at 4:09 pm

    BR: Thanks.

  2. Guest   July 28, 2009 at 10:37 am

    Prices are down 6% which puts owners underwater even more (less able to sell, more likely to default), notices of defaults are continuing to stay at high levels, and unemployment is going up. This is the medium term reality, rather than a peak of the spring/summer buying season or a tax rebate/home buyer credit external variable.The TV channels know that viewership is higher when the market goes up (equals higher advertizing revenue), so they’re pumping this story up, minimizing the news impact of the above negative factors.

  3. Guest   July 31, 2009 at 4:55 am

    Mr. BR-Sir,I would love to see you in Geithner’s job for a few weeks-you might not make a long term difference but you could surely give some heart attacks where they are due!!!Simple questions: on the next cycle down will the speculators begin to drown??? will the cycle start feeding itself-lower prop value/economic levels leading to more foreclosures etc.?? Are even gov. jobs safe? No one realizes that unemployment has no knoiwn natural limit (at least I have read only speculation where it will level). Suppose we stabilize at 14-15% nominal(read 21%) how on Earth will housing values not continue to collapse. To be a smarty, will there be a sufficient supply of qualified RENTERS for these speculatively purchased homes????Joe Smart buy 7 homes at auction with a few 100 thousand loose cash. He gets financed. The homesneed repair they are unrentable at first. Well, skip the repairs, rent to welfare people. Or do the repairs, raise the rent to a level that makes his cash flow, the renters fall behind the third month they are in the house-the Mrs. has lost her Wal-Mart job. Evictions in many places are slower than foreclosure proceedings. Joe Smart loses cash flow, prop value drops, he walks away cuts his losses and rather than paying delinquency fees he simply stops his payments, now the HOUSE enters into LIMBO zone. He can go on (NOT BORROW MORE OF COURSE) he is only delinquent his other properties can be lega;;ly seperate if he has incorporated properly. In the MidWest a Sharpie Like JOE could take a Land Contract on some properties(with NO CLEAR TITLE!), make 25% on his down payment and then simply walk.Simply look at what is going on in that now worthless part of our country, Cleveland. Ehh so what, most of the country is worthless as far as the 2% is concerned. How many crooks have even been indicted??? This is as hilarious as the S&L rape. NO, it appears that some of the masterminds are moving over to their saved positions in this incredible administration. Administration???? That’s an oxymoron.George HarterBaghdadontheHudson, USA

  4. Guest   July 31, 2009 at 5:06 am

    I think the real blowout will occur, strangely enough after average American schmucks become more aware of how the Dems are as good at selling them down the river as the Bush clique was. No amount of computer market/accounting manipulation will save equities fabbed by fraud out of thin air. And I believe that once reality sets in somewhere the computers are liable to DUMP massive amounts and create a panic that the cyberscum can not control. It doesn’t matter how hard you beat a dead horse-IT IS DEAD/NO LONGER MANIPULABLE. Market collapse as we have recently, seen panics rabbity Americans much more than the wealth erosion from dropping real estate values.It is not fun being around stupid people in a panic!!!georgebagh