by Mish

Sales were down in the South, the West, and Northeast, so don’t blame the hurricanes.

Economists Surprised Again

Economists were surprised by another month of weak new home sales.

RECOMMENDED ARTICLES

The Econoday consensus estimate was 583,000 at a seasonally adjusted annualized rate (SAAR) but sales came in at 560,000 SAAR.

Weakness in the South pulled down new home sales in August as it did in last week’s existing home sales report. New home sales fell sharply in the month to a 560,000 annualized rate vs an upward revised rate of 580,000 in July and a downward revised 614,000 in June (revisions total a net minus 7,000).
Sales in the South, which is by far the largest region for housing, fell 4.7 percent in the month to a 307,000 rate for a year-on-year decline of 9.2 percent. But importantly, sales in the West and Northeast were also lower, down 2.6 and 2.7 percent respectively, with sales in the Midwest unchanged.
September, in fact, was a weak month for housing demand, evident in this report’s median price which fell a very sharp 6.2 percent to $300,200. Year-on-year, the median is up only 0.4 percent which, in another negative, is still ahead of sales where the yearly rate is minus 1.2 percent.
Builders, despite late month disruptions in the South, moved houses into the market, up 12,000 to 284,000 for a striking 17.8 percent yearly gain that hints at a glut. But supply had been so thin that the balance is now at a traditional level, at 6.1 months vs 5.7 and 5.3 months in the prior two months and 5.1 months a year ago.
Hurricane effects are likely in the next report for September with the South to continue to suffer. But today’s data do mark a shift, one of softening sales nationally, which is a short-term weakness, and a rebalancing in supply which is a long-term strength. Yet for the 2017 economy, the housing sector looks to be ending the year in weakness, some of it hurricane-related.

Expect downward revisions in GDP estimates for the third and fourth quarters.

Mike “Mish” Shedlock

Pending Home Sales Unexpectedly Dive: NAR Blames Tight Supply

Fresh on the heels of a glowing existing homes sales report comes news of an unexpected plunge in pending home sales. Economists in the Econoday survey expected a 1.1% increase. Instead, the pending home sales index plunged 2.8%.

Pending Home Sales Down Again: NAR Blames “Staggering Lack of Inventory”

The pending home sales index for July dropped 0.8 percent vs an Econoday expected gain of 0.4%.

Existing Home Sales Down Again: Yun Blames Inventory, a Symptom of the Problem

Economists expected a bounce in existing home sales in May. There was no bounce and revisions in April were negative.

Existing Home Sales Unexpectedly Decline to 2017 Lows

On the heels of an unexpected decline in new home sales yesterday, comes news of an unexpected decline in existing home sales today.

Retail Sales Unexpectedly Dive: Spotlight on Cars and the “Amazon Effect”

Retail sales rose a mere 0.1% in November according to the Census Department Advance Monthly Retail Trade Report.

New Home Sales Weakening as Builder Speculation Increases: Home Builders In Trouble?

This morning, the Census Bureau reported New home sales are down again. Diving a bit deeper into the report there is clear evidence of builder speculation just as home sales and prices weaken.

Existing Home Sales Unexpectedly Decline

Existing homes sales fell 0.4% in April. The Consensus expected a rise.

Pending Home Sales Unexpectedly Dive to Lowest Level in 3.5 Years

Those who thought weakness in home sales was a temporary soft patch appear to have things wrong.

New Home Sales Near Post Crisis High

New homes sales rose at a seasonally-adjusted annualized rate(SAAR) of 621,000 in March vs. an Econoday expectation of 588,000.