Interest Rate Roundup

Thursday, October 26, 2006

Fire sale on new homes

The latest new home stats just came out. Here are some details. But the headline, from my perspective is "Fire sale in new homes!" Median prices dropped a whopping 9.7% YOY -- the most in 36 years. Details below ...

* Sales fell 14.1% YOY in September, an improvement from the YOY declines shown in August (20.9%) and July (29.1%). The seasonally adjusted annual rate o sales was 1.075 million units, up 5.3% from August's 1.021 million units, which was revised up from the originally reported 1.05 million units. That MOM gain beat expectations.

* Total homes for sale on the market were 557,000, down a bit from the summer peak (570,000). The months supply at current sales pace reading of inventory was 6.4 months, down from the July peak of 7.2 months. There are lots of completed, empty homes within the mix, however.

* The biggie in the report is the whopping decline in median prices. Median home prices plunged 9.7% YOY in September to $217,100. That appears to be the single-biggest decline in any month going all the way back to December 1970 (when they declined 11.2%).


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