New Home Sales Continue Double Dipping
When considering the graphs below (provided courtesy of Calculated Risk), pay special attention to the Recession Bars (blue-colored lines that denote NBER - identified recessions). For the most recent recession, which began in late 2007, the NBER has not yet declared it over, as they typically do not make such pronouncements until many months after. The reason why the blue bar ends in the middle of 2009 is therefore only a best-guess by most economists, and does not represent the actual conclusion of the NBER.
There are two inescapable facts:
1. In the modern era, of which we have quality housing records, there has never before been a double dip in new home sales outside of the entire economy still being in NBER - defined recession. Therefore, if the NBER does conclude that the most recent recession did in fact end last year, this would be a very unusual first.
2. There has never before been a pronounced upward spike in months of supply from already historically high levels outside of the entire economy still being in NBER - defined recession. Therefore, if the NBER does conclude that the most recent recession did in fact end last year, this would also be a very unusual first.
Calculated Risk:
New Home Sales fall to Record Low in January
The Census Bureau reports New Home Sales in January were at a seasonally adjusted annual rate (SAAR) of 309 thousand. This is a record low and a sharp decrease from the revised rate of 348 thousand in December...
Months-of-supply and inventory have both peaked for this cycle, but sales have set a new record low. New home sales are far more important for the economy than existing home sales, and new home sales will remain under pressure until the overhang of excess housing inventory declines much further.
Obviously this is another extremely weak report.
Click for full size
Credit: Calculated Risk
Click for full size
Credit: Calculated Risk
-Related-
From Calculated Risk
Freddie Mac: "Potential Large Wave of Foreclosures"
"We start 2010 with some early signs of stabilization in the housing market, with house prices and home sales likely nearing the bottom sometime in 2010. We expect that low mortgage rates, relatively high affordability and the homebuyer tax credit will help continue to fuel the recovery. Still, the housing recovery remains fragile, with significant downside risk posed by high unemployment and a potential large wave of foreclosures." - Freddie Mac Chief Executive Officer Charles E. Haldeman, Jr.
There are two inescapable facts:
1. In the modern era, of which we have quality housing records, there has never before been a double dip in new home sales outside of the entire economy still being in NBER - defined recession. Therefore, if the NBER does conclude that the most recent recession did in fact end last year, this would be a very unusual first.
2. There has never before been a pronounced upward spike in months of supply from already historically high levels outside of the entire economy still being in NBER - defined recession. Therefore, if the NBER does conclude that the most recent recession did in fact end last year, this would also be a very unusual first.
Calculated Risk:
New Home Sales fall to Record Low in January
The Census Bureau reports New Home Sales in January were at a seasonally adjusted annual rate (SAAR) of 309 thousand. This is a record low and a sharp decrease from the revised rate of 348 thousand in December...
Months-of-supply and inventory have both peaked for this cycle, but sales have set a new record low. New home sales are far more important for the economy than existing home sales, and new home sales will remain under pressure until the overhang of excess housing inventory declines much further.
Obviously this is another extremely weak report.
Click for full size
Credit: Calculated Risk
Click for full size
Credit: Calculated Risk
-Related-
From Calculated Risk
Freddie Mac: "Potential Large Wave of Foreclosures"
"We start 2010 with some early signs of stabilization in the housing market, with house prices and home sales likely nearing the bottom sometime in 2010. We expect that low mortgage rates, relatively high affordability and the homebuyer tax credit will help continue to fuel the recovery. Still, the housing recovery remains fragile, with significant downside risk posed by high unemployment and a potential large wave of foreclosures." - Freddie Mac Chief Executive Officer Charles E. Haldeman, Jr.