U.S. New Home Sales Rose 17.5% In December

January 26th, 2011 by Belisarius

(For December)

U.S. new home sales rose 17.5% to 329.000 SAAR; Consensus was  at 300.000 SAAR, prior reading (revised downward 10.000) was at 280.000 SAAR.

Month of supplies fell from 8.4 down to 6.9 months. Backlog of unsold new homes is at 191.000, lowest since February 1968.

As I wrote yesterday, months of supply is still above pre-crisis levels, but the absolute level of unsold new homes is so low that small pickup in new home sales could lead to demand outweighing supply.

If inflow of foreclosed homes to the market does not increase dramatically the possibility of further large-scale decreases of  home prices is not high. I will monitor situation closely as home prices are crucial for financial sector health.

Chart 1. U.S. New Home Sales SAAR

Chart 1. U.S. New Home For Sale And Months’ Supply


 

This entry was posted on Wednesday, January 26th, 2011 at 11:31 am and is filed under U.S. Economic Data, U.S. Housing. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.

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