Courtesy of Mish.
New Home sales rose to a Seasonally Adjusted Annualized Rate (SAAR) of 592,000 vs. a Bloomberg Econoday consensus estimate of 562,000.
Interestingly, home price appreciation as measured by Case Shiller unexpectedly declined by 0.1%. That is on top of a revision of for last month from +0.5% to-0.2%.
Housing is emerging as a positive surprise for the 2016 economy. New home sales burst to their best strength of the cycle during the Spring, coming in at a much higher-than-expected 592,000 annualized rate in June following a 572,000 rate in both May and April (both revised). To see the strength by comparison, the rate in June last year was 25 percent lower at 472,000.
Trend strength appears across regions led by the Midwest, up 44 percent year-on-year, with the South at the rear but still up 21 percent. Monthly data show slowing in the Northeast, where however sales totals are very small, and solid strength in the West which is a key region for home builders.
The gain in sales did not come at the expense of prices, at least in June. The median jumped 6.2 percent to $306,700 which, however, is only up 6.1 percent from a year ago.
New Homes Sales 1963-Present
The above chart puts a needed perspective on the strength of the the housing recovery. Sales are where they were in January of 1963!
Home Prices Unexpectedly Decline
The Wall Street Journal reports U.S. Home-Price Increases Maintained Strong Pace in May.
“S&P/Case-Shiller Home Price Index rose 5%, matching April’s increase. Home prices continued rising quickly in May, further proof that the housing market had its strongest spring since the recession,” says the Journal.
However, for the last two months, home prices actually fell. Bloomberg Econoday provides this comparison.
