by Bill McBride on 2/24/2010 10:15:00 AM
Wednesday, February 24, 2010
Note: See previous post for video and discussion of Bernanke's testimony.
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.
Click on graph for larger image in new window.
The first graph shows monthly new home sales (NSA - Not Seasonally Adjusted).
Note the Red column for 2010. In January 2010, 21 thousand new homes were sold (NSA).
This is below the previous record low of 24 thousand in January 2009.
The second graph shows New Home Sales vs. recessions for the last 45 years. New Home sales fell off a cliff, but after increasing slightly, are now 6% below the previous record low in January 2009.
Sales of new single-family houses in January 2010 were at a seasonally adjusted annual rate of 309,000 ... This is 11.2 percent (±14.0%)* below the revised December rate of 348,000 and is 6.1 percent (±15.1%)* below the January 2009 estimate of 329,000.And another long term graph - this one for New Home Months of Supply.
There were 9.1 months of supply in January. Rising, but still significantly below the all time record of 12.4 months of supply set in January 2009.
The seasonally adjusted estimate of new houses for sale at the end of January was 234,000. This represents a supply of 9.1 months at the current sales rate.The final graph shows new home inventory.
Note that new home inventory does not include many condos (especially high rise condos), and areas with significant condo construction will have much higher inventory levels.
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.