Friday, September 24, 2010

New Home Sales August 2010 (Repeat with graphs)

by Bill McBride on 9/24/2010 10:58:00 AM

Note: I apologize for the technical difficulties this AM.

The Census Bureau reports New Home Sales in August were at a seasonally adjusted annual rate (SAAR) of 288 thousand. This is unchanged from July.

New Home Sales Monthly Not Seasonally Adjusted Click on graph for larger image in new window.

The first graph shows monthly new home sales (NSA - Not Seasonally Adjusted or annualized).

Note the Red columns for 2010. In August 2010, 25 thousand new homes were sold (NSA). This is a new record low for August.

The previous record low for the month of August was 34 thousand in 1981; the record high was 110 thousand in August 2005.

New Home Sales and Recessions The second graph shows New Home Sales vs. recessions for the last 47 years. The dashed line is the current sales rate.

Sales of new single-family houses in August 2010 were at a seasonally adjusted annual rate of 288,000, according to estimates released jointly today by the U.S. Census Bureau and the Department of Housing and Urban Development. This is unchanged (±16.7%)* from the revised July rate of 288,000 and is 28.9 percent (±11.0%) below the August 2009 estimate of 405,000.
And another long term graph - this one for New Home Months of Supply.

New Home Months of Supply and RecessionsMonths of supply decreased to 8.6 in August from 8.7 in July. The all time record was 12.4 months of supply in January 2009. This is still very high (less than 6 months supply is normal).
The seasonally adjusted estimate of new houses for sale at the end of August was 206,000. This represents a supply of 8.6 months at the current sales rate.
New Home Sales Inventory The final graph shows new home inventory.

The 288 thousand annual sales rate for August is just above the all time record low in May (282 thousand). This was another very weak report. New home sales are important for the economy and jobs - and this indicates that residential investment will be a sharp drag on GDP in Q3.