In the rollercoaster that is housing news this week, home prices reach new lows in nine cities and are down to their lowest levels since March. housing starts are down and permits are up and builder confidence rates are stable.
Today, the US Commerce Department announced a jump in new home sales of 17.5%, the best month the new home sector has had since April (although sales are down 7% from this time last year). Some speculate the rise occurred due to buyers attempting to lock in rates given their rise (the average 30 year mortgage rate was 4.93% in December, up from 4.44% in November).
New home sales weren’t strong in all regions, however the West performed well (ironically in the same region where there is an inventory glut). Builders also finally caught a break after two straight years of getting pummelled in that the median price rose 8.5% from last year.
Some day we’ll be able to look back and point at the exact move that caused the proverbial house of cards to topple, but for now, we continue the long bounce at the bottom.
