New Home Sales
July New Home Sales, about 15% of the market, totaled 433k annualized, 43k above estimates and up from a revised 395k in June. It is now at the highest level since Sept ‘08. Months supply fell to 7.5 from 8.5 and to the lowest level since April ‘07 and is an obvious big improvement as its now well off its high of 12.4 in January and close to its 30 year average of 6.1. The gains were seen in the Northeast, South and the West. The Midwest saw a drop. The absolute number of homes for sale fell to 271k, down 9k from the prior month and is now the smallest amount since April ‘93. The median price fell 11.5% y/o/y and down a touch m/o/m. According to Bankrate.com, the average 30 yr mortgage rate was 5.37% in July, down from 5.48% in June. The $8,000 tax credit for 1st time home buyers continues to help and we’ll see if it continues past the Nov 30th deadline. Today’s # also squares with the cautious optimism given from some homebuilder CEO’s.
August 26th, 2009 at 3:57 pm
The unemployment rate in the nation, which stands at 9.7% currently, may even increase to alarming double digit number making the financial situation even worse for the borrowers to repay. The layoffs of many workers have been permanent and hence, their hopelessness in recovery of the jobs or helplessness to repay mortgage over time looks bleak and they resort to foreclosure than choosing to invest or borrow more money on something that they are not sure whether they would be able to afford in the long run.
With the rise in unemployment rates and inability of the helpless borrowers to repay the loans, mortgage delinquencies are on the rise.
Read More: http://www.housingnewslive.com/articles/reasons-housing-market-going-down.php