Thanks to revisions, the Census Bureau’s New Home Sales report shows new home sales rose for the third month. The good news, not that it’s remotely believable, stops there.
New home sales rose 1.1 percent from a reported 670,000 last month to 640,000 this month. Numbers are at a seasonally-adjusted-annualized rate (SAAR).
If that looks like a decline not an increase, a revision took last month from 670,000 to 633,000.
The implication is the reported rise last month was not 7.2 percent but rather 1.8 percent (plus or minus 15.3 percentage points, yes seriously).
February 2023 Report Numbers
New Home Sales: Sales of new single‐family houses in February 2023 were at a seasonally adjusted annual rate of 640,000, according to estimates released jointly today by the U.S. Census Bureau and the Department of Housing and Urban Development. This is 1.1 percent (±15.3 percent) above the revised January rate of 633,000, but is 19.0 percent (±12.9 percent) below the February 2022 estimate of 790,000.
Sales Price: The median sales price of new houses sold in February 2023 was $438,200. The average sales price was $498,700.
For Sale Inventory and Months’ Supply: The seasonally‐adjusted estimate of new houses for sale at the end of February was 436,000. This represents a supply of 8.2 months at the current sales rate.
New Home Sales Seasonally Adjusted
I am pleased to note that with this three-month bounce in sales, we are nearly back to the level seen in July of 1963. Let’s not go into population-adjusted sales.
New Home For Sale by Stage of Construction
Homes For Sale Discussion
The Census Bureau reports 436,000 homes are “For Sale”. From that, the bureau measures “months’ supply”.
But of those 436,000 homes for sale, only 72,000 have been completed. 269,000 have not been started and in this environment might not be.
Revisions
Revisions have been huge for months. Many months have been revised lower multiple times. For more details on prior revisions, please see my January report New Home Sales Rose for the Second Month But the Bounce Won’t Last.
Here is one snip.
November Hooray Flashback
Looking back to the Census Bureau’s November report published in December, I then commented “Hooray, we have a reported 5.8 percent rise in new home sales in November.”
Today we can see the that the alleged 5.8 percent rise in November is really a 1.0 percent decline.
What About Cancellations?
The Census Department does not subtract cancellations from its reports and cancellations due to rising mortgage rates have been huge.
Not even the revisions include cancellations and cancellation rates have been astronomical.
Last month, the margins of error were stated as ±20.4 percent.
Hooray! This month the margins of error, not including cancellations, are a mere ±15.3 percentage points.
This post originated on MishTalk.Com.
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Mish
I’m in North Florida and apparently we have a lot of people who have already sold their houses up north and are buying them down here. Most likely the retired sector, which is what our benevolent overlords here want. Retired people with money and no business competition.